INFLATION and geopolitical tensions are top issues that can slow down growth of the fashion industry next year.
Consumer behaviours in 2023 will depend greatly on household incomes.
The lower income households are likely to be more affected. They will cut back or eliminate discretionary spending compared with the higher income households.
The casualisation trend that took hold during the Covid-19 pandemic will continue into 2023, according to the BOF-McKinsey “State of Fashion 2023” survey report
Casualwear, followed by sportswear and sneakers are the highest-ranking categories in terms of where executives see the greatest growth potential while accessories, jewellery and formal shoes ranked lowest, it says.
McKinsey expects global fashion sales growth of 5 % to 10% for luxury, and negative 2% to positive 3% for the rest of the industry in 2023.
It says Gen-Z will hold great sway over key parts of the fashion industry.
Growth is also shifting and markets that once showed solid growth potential are now facing a wider range of risks.
Instead, regions such as the Middle East may become new havens of growth, requiring brands to further localise designs, marketing and merchandising to attract new customers.
Brands need to team up with manufacturing partners to sharpen their supply chain strategies and distribution channel mixes are also ripe for reassessment, it adds.