Recession! Strategies To Launch a Fashion Brand.

Recently, the threat of an economic downturn has emerged around the world. Seventy percent of economists surveyed in a Financial Times survey predict a recession by 2023.

Fears of a recession arose due to volatile economic conditions including the impact of high inflation on foodstuffs and gas. As well as the ripple effect of the supply chain and the destruction of the production of raw materials from the Russo-Ukrainian War. To reduce this inflation, the Federal Reserve plans to raise interest rates. However, economists worry that this move will slow the economy too much and lead to a recession.

What Happens During a Recession?

As shown, recessions result from a specific series of connected events, and therefore, all recessions are unique. This uncertainty places established and emerging fashion business owners in uncharted territory. Fortunately, archetypal patterns in consumer behavior continue to guide even the newest brands through challenging new economic conditions. Consumer confidence will dwindle, unemployment rates are high, and interest rates are high.

There are also some income groups that will react differently to a recession. However, here you will not discuss further about it, we will discuss what you will do when the recession comes! It is not categorized under income because all businesses are equal, regardless of the background of the owner.

3 Tips to Help Your Business Survive Economically When Uncertain

Starting a business can be very stressful and risky during periods of high inflation, tight labor markets, and supply chain difficulties. However, you should not delay your dream. While our economy has to deal with cyclical patterns of economic downturn, experience and pattern discovery have yielded three key guidelines on the best way to start and maintain your fashion business.

1. Go Bargain or Go Luxury in Your Product Range

Customers are buying essentials and looking for deals or they are the top percentile with the recession barely affecting their financial situation. Therefore, experts have determined that mid-level companies will perform the worst.

We can take an example from during the 2008 recession. Budget retailers such as Target, Khol’s, and Ross found great success without affecting the luxury goods market. While the luxury goods market fell 9%, several brands in the market performed better than expected such as Gucci, Hermes, and Richemont. For example, Richemont’s income increased by 2.4 percent during the Great Recession.

2. Hone Your Clothing’s Specific Values

Recession is a time to emphasize what your brand is best at as customers become more selective in their purchases. For example, Lisa Marie Fernadez successfully launched a new swimwear line in 2008. Lastly, she highlighted that another surprising benefit of launching during the recession was a drop in consumer demand. Which allowed her to fulfill product orders more easily and sustainably once her business started. In the end, she stressed that “Consumers, they are stopping their spending but they are going to spend on something they don’t have in their closet yet; they won’t spend and keep buying repeat purchases.”

That’s the main reason why fashion industry experts recommend starting a private label clothing brand instead of a wholesale brand. Because private labels allow for greater control over your products and allow you to create something unique for the market. Besides, wholesale products, are cheaper per item, but also less unique and can be found in several other stores.

3. Create Fashion Brand Loyalty

In addition to the quality of your product, your brand image and customer service will also influence customers to choose it over competitors. Economic downturns are tough times, and it is important for companies to express their concern and customer service through different communication channels such as email campaigns and social media.

Also, it’s more important than ever during a recession to provide customers with a good service experience that will keep them coming back, interacting with your brand more, and even better, leaving you positive reviews online or sharing your products with friends and family.

Turning Difficult Economic Times into Opportunities

You don’t have to be dizzy or confused in making decisions! You can take advantage of these people’s riots by looking at the opportunities! Don’t let the gloomy economic predictions themselves get in the way of your goals. Starting a fashion business may require a lot more thought, planning, and product investment. But you know that if your business can get through something big like a recession, it also overcome other problems and thrive even more when time is inevitable.