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This #BoFLIVE event was based on the article “Why Price Inflation Is Coming to Fashion.” Click here to read our full analysis.
Apparel prices across categories are rising fast. It’s a trend opposite to what the industry has dealt with over the past 30 years, particularly since the Great Recession, as fast fashion’s domination and year-round sales and promotions made for more “deflation” rather than “inflation.” Pandemic-driven supply chain disruptions and increases consumer demand may have kickstarted the shift, but a desire on the part of retailers to end discounting cycles and regain pricing power may mean inflation is here to stay in fashion, at least for the time being.
“In a span of months last year, the balance of power pivoted back to the brand and the retailer in a way that we haven’t seen since 2008,” said Simeon Siegel, managing director, equity research at BMO Capital Markets. “If there’s fewer units and you can appreciate that proactively, you have an opportunity to completely refashion the pricing element.”
On the latest #BoFLive, Siegel joins Intermix chief executive Jyothi Rao and BoF deputy editor Brian Baskin and senior editorial associate Alexandra Mondalek to discuss which brands and retailers are best poised to capitalise off of pricing power shifts, how they can do so, and how long it will last.
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