Banks. Car manufacturers. Insurance companies. Almost every industry is feeling the effects of the economic collapse. The major fashion designers are no exception.
A quick look at the steep decline in stock prices over the past year reflects just that. Major designers like Polo, Kenneth Cole, and retail establishments like Saks have all taken significant cuts in share price. The market is also prohibiting further growth as exhibited by the recent postponement of Prada’s plan to take the company public.
Opening a designer up to public investments leads to a huge infusion of cash and assets. The cash can be used to hire new talent, increase distribution, and diversify. But Prada has delayed this three times so far, citing poor market conditions.
So what’s next? With the majors reducing output and becoming more risk adverse, there could be an emerging market for new creative and low cost designs. Layoffs could free in-house designers to spread their wings and establish new lines. Although it would be difficult to raise enough capital to become a national brand right away, we could see local designers taking advantage of the opportunity to deliver even more innovative designs.
What do you think will be the next big trend in fashion, considering the effect of the economy? Share it with us in the comments.
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