Recently, some heavyweight and well-known international textile and clothing companies have successively reported that they have filed for bankruptcy protection: Japan’s MUJI confirmed that its US subsidiary MUJI has applied for bankruptcy protection on July 10, local time. Its announcement stated that MUJI American companies already have debts of US$64 million, with more than US$27 million in new liabilities in May alone, and there is no hope for more in the future; another old American clothing company, Booker, was founded in 1818 The brothers also announced that they had filed for bankruptcy protection, shocking their American counterparts; this month, TM Lewin, a century-old British men’s clothing brand, announced that it had entered bankruptcy proceedings and closed all 66 of its stores; last month, the well-known Italian high-end men’s clothing brand Corneliani officially filed for bankruptcy protection; in addition, the American luxury department store group Neiman Marcus, which also has a century-old history, recently applied for bankruptcy protection in the local court and signed a restructuring agreement with its creditors. The well-known Canadian shoe chain brand Aldo Group also filed for bankruptcy according to local court procedures. Protect. Coincidentally, André, a century-old French shoe brand founded in 1896, had previously closed all its stores in France and had to apply to the court to initiate bankruptcy reorganization procedures.
Looking at a series of internationally renowned textile and apparel companies with a long history of development collectively filing for bankruptcy protection, what implications will it bring to the industry and brands?
First of all, the epidemic has had a serious impact on many clothing brands, showing that the brand’s ability to resist risks urgently needs to be strengthened.
A spokesperson for Brooks Brothers in the United States said that in the past year During the year, Brooks Brothers experienced frequent operational problems, and the epidemic hit, making operations even worse. Similarly, Muji’s U.S. business only contributed about 2.5% of the group’s total revenue last fiscal year. This business has suffered losses for three consecutive fiscal years, with a loss of about US$10 million in the last fiscal year. It can be seen that before the outbreak of the new coronavirus pneumonia, the operations of MUJI’s US subsidiary had encountered obstacles. Some analysts say that in recent years, commercial rents in the United States have continued to increase, and corporate cost burdens have been heavy. Since the beginning of this year, the number of new commercial bankruptcies in the United States has reached 3,604, an increase of 26% compared with the same period last year. Coupled with the help of the epidemic, bankruptcy filings are accelerating, with 609 new cases in June this year, a year-on-year increase of 43%. The most important thing is that the sales market has been deeply affected by the epidemic, and consumers’ purchasing power is not strong, resulting in increased revenue losses for companies, thus accelerating the rate of company closures. The analysis pointed out that the reaction speed determines the blood return speed. Time-honored textile companies often underestimate risks due to their deep roots, pampering, and overconfidence. When risks come, they appear to be at a loss, respond slowly, and lack risk control awareness.
Secondly, consumers are more inclined to pursue cost-effective products during the epidemic, and brands are increasingly relying on them for survival. To provide the market with cost-effective products and to combat risks.
The epidemic has made consumers’ demand for cost-effective products more and more Products with outstanding quality, practicality and affordability have become new favorites. Facing the uncertainty of the global consumer market, brands urgently need to continuously upgrade and innovate themselves, accurately analyze the market, industry environment and consumer behavior patterns in the post-epidemic era, and optimize and establish products that meet consumer demands and are reasonably priced. Re-examining prices has become a point that time-honored international textile companies are paying more and more attention to. Taking Japan’s Muji as an example, it has shifted from an affordable brand to a super affordable brand. Through continuous optimization of refined management and supply chain upgrades, it has created more consumer-friendly products.
Thirdly, the changes caused by the epidemic on the consumer market are not only reflected in changes in consumer demand levels, but also in consumption habits. Brands need to actively follow consumers’ new purchasing needs and paths and innovate in channels.
Relevant experts said that the global epidemic has caused people to attend business meetings and social events are gradually reduced, so the need for dress for such occasions will be suppressed. To this end, British men’s clothing brand TM Lewin plans to rethink market segmentation and positioning in order to explore new market opportunities. In addition, every autumn is the back-to-school season for students, which is usually regarded as the second largest sales season after the Christmas shopping season in Europe and the United States. However, this year due to the epidemic, the global retail industry is still facing great uncertainty. If a large number of students need to continue taking online classes at home, then the sales of electronic products will likely increase, while consumer spending on clothing, shoes and other categories may decline. Therefore, some international leisure brands will adapt to the situation and adjust the production of youth clothing in a timely manner. In order to reduce foreseeable losses.
The impact of the epidemic on the global textile and clothing industry continues.Although a large company has applied for bankruptcy protection, it does not mean that it will go bankrupt. Even if it “breaks” now, it’s only temporary. Because during the period when it is unable to repay its debts, it can conduct financial restructuring to give itself the opportunity to make profits again. Through adjustments, some international time-honored textile companies that have fallen have the opportunity to make a comeback and return to the public eye. As for whether their endings are good or bad, we have to wait and see. </p
