“Dispatch from Europe” is a round-up of the trends that are currently shaping the European world of retail and fashion.
Fair Trade
The road to improving the environment is paved with T-shirts — fair-trade, cotton T-shirts, to be exact.
WWD found that “ethical fashion is broadening its scope” in Europe as shoppers base their purchase decisions on the clothing’s country of origin, as well as whether they believe the brand has a reputation of sourcing their products in an ethical manner. Mike Barry, head of corporate responsibility at Marks & Spencer said, “80 percent of our consumers wanted to know more about how clothing products were made.”
Without fair trade, farmers in economic straits resort to using more and more chemicals in an effort to increase their output. This creates a taxing effect on the environment, and an unending cycle as the consumer demands lower and lower prices for the same goods.
For WWD’s coverage of fair trade, see: Fair Trade Fashion Takes Off In Europe.
Repeal of the Retaliatory Tariff
In a twelfth-hour decision on May 11, the U.S. Congress voted to repeal the legislation under scrutiny as a result of the EU’s proposed retaliatory tariff. In a move sanctioned by the WTO, the EU was prepared to levy sanctions, the largest ever approved by the WTO.
The duties were to go into effect as of May 14 and impinge on agricultural items, textiles, industrial products, electronic products, paper products and steel. The conciliatory move has finally quieted the heated dispute that formally began in 1984.
For WWD’s coverage of the Retaliatory Tarriff, see: WTO Hits U.S. On Subsidies, Again.
Economic
A January economic report released by the United Nations predicted that world economic growth was projected to increase by 3.3 percent. The EU economy sagged slightly below this average, with an anticipated economic increase of only 2.1 percent. The report recommended that the EU bloc work on measures that would jump-start domestic demand.
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For WWD’s coverage of Europe’s economy, see: U.N. Economic Report Sees China, India Driving Growth.
Taking A Closer Look:
Italy
Despite the overwhelming popularity of celebrity fragrances and the inundation of star-fueled scents in the U.S., the perfume industry in Italy does not appear to be faring quite as well.
“The market is in crisis,” testifies Stefano Biagi, commercial director of Limoni, “They are going either super-luxury or they are going niche.”
For those perfumes straddling this divide, the past year has been tough. In response, some of the fragrance industry’s movers and shakers have devised individual plans of action. Sephora plans to convert 80 percent of its 99 perfumeries acquired to enter the market. Mazzolari believes success lies in a return to luxury and an end to discounting. Douglas plans to diversify its doors in order to give its customers “a feeling of getting something special that is unique,” says Jorg Mingers, Douglas’ southwestern Europe general manager.
Meanwhile, Italy’s luxury clothing business appears to be faring quite well. Armani, Versace, Missoni, Moschino and Dolce & Gabbana all reported an increase in pre-fall orders. Dolce & Gabbana reported a whopping 35 percent increase in such sales. The increase is attributed to a fashion-hungry consumer who must acquire the next season’s “must haves” before anyone else.
“Now more than ever, customers want the new collections earlier and earlier, and it does not matter what part of the world they come from,” explained Loredana Nastro, Versace’s wholesale division director.
For WWD’s coverage of the Italian perfume industry, see: Italian Retailers on the Offensive.
For WWD’s coverage of the Italian luxury clothing business, see: Strong Pre-fall Orders Raise Season’s Hopes.
Belgium
The recent dearth of Belgian fashion designers was largely a result of their utter refusal to “play the game” and keep their names in the lights by slaving away to please Hollywood fashion plates. Instead, trendsetters like Dries van Noten and AF Vandervorst have been honing their craft in the shadows, patiently waiting for the right moment to pounce back on the scene. With a flurry of new talent emerging from the homeland, such as Kris Van Assche, Peter Pilotto and Bruno Pieters, as well as a market trending in their favor, it appears that once again their time has come.
For WWD’s coverage of Belgian designers, see: Seizing the Moment: Belgian Designers Chart Growth Plans.
Poland
New EU entrant Poland is chomping at the bit to get its “new” economy up and running. A large portion of the country’s plans depends on a grant of approximately $60 billion euros that the Polish government will allot solely to small to medium-size textile and apparel firms.
Zyta Gilowska, the country’s finance minister, hopes that these efforts will help the country gain more foreign investment as it works to remove hurdles for business and mold itself into a formidable global competitor.
For WWD’s coverage of Poland’s textile industry, see: Poland Slates EU Funds for Textile Industry Development.
France
The city of lights is working hard to brighten its dim retail market. Alain Celhay, an owner of Paris’ coveted retail real estate, Montaigne Market, reports, “Generally, business in France isn’t so hot — across most of Europe, even.” Fortunately, in addition to the stability of luxury sales, tourism appears to be on the rise once again, with 16 percent more Americans having visited in September 2005 than in the previous year. This is likely a precursor of a crescendoing retail market.
For WWD’s coverage of France’s retail market, see: Paris’ New Retail Crop.
Germany
Soccer fans unite, briefly, in their love of World Cup merchandise. In eager anticipation of the June 9 athletic blowout, Germany has pulled out all the stops with a sundry of global athletic licensing agreements. Among the headliners: FIFA, Adidas, Dolce & Gabbana, Prada, Giorgio Armani and H&M, all of which are planning some sort of World Cup allusion in their current lines.
Armani and Dolce & Gabbana have won one of the more coveted assignments — they’ve been chosen to design England and Italy’s (respectively) off-the-field ensembles.
For WWD’s coverage of Germany and it’s World Cup merchandising, see: Brands and Stores Get in Step for World Cup.
Sweden
With new, quirky (and comparatively cheap) denim lines, Sweden is sweeping the European market with its skinny, street-chic styles. Brands like Cheap Monday, Edwin and Acne Jeans are giving other European lines — which had appeared to have unshakable market monopolies — a run for their money.
For WWD’s coverage on Sweden’s denim market, see: Cheap Thrills
and Sweden Rekindles Its Passion for Jeans.