Fashion Industry Overview

Introduction

Fashion industry comprises the enterprises that make and sell clothes. Fashion refers to various clothing styles liked and worn by different groups of people at a given period. Different people love wearing different clothing styles at different seasons. These choices are determined by various factors related to consumers' locations such as cultures, tastes, and preferences, among many others. According to Ozdamar and Atik (2015), the fashion industry is responsible for designing, manufacturing, distributing, advertising, marketing, retailing, as well as promoting all types of apparel from designer fashions to ordinary clothes worn in everyday life activities. Numerous factors affect the fashion industry. Some factors enable fashion companies to grow while other factors inhibit them.

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Factors Enabling the Growth of Fashion Industry

There are many factors enabling the growth of companies in the fashion industry. These include consumer factors, technology, economy, as well as government influence. These factors are discussed below.

Consumer Factors

The consumers-related factors enabling the growth of the fashion industry include lifestyles, norms, cultures, and increase in population. As many people continuously embrace luxury lifestyles, fashion companies make huge profits from selling their clothes at premium prices (Macchion et al. 2015). Large amounts of profits enhance the company's capacity to expand its operations and diversity of service provision. So long as the company produces clothes that are accepted within the norms of a given society, it has very high chances of selling them in large quantities to make a high amount of profits. The company whose brand has won the trust of the people is more likely to reap greater profits from the people in that particular region. For that reason, the norm of the people can act as an enabling factor for the growth of a fashion company because norms do not change rapidly. It takes time for a society to change its norms. The little or no variability in the norms of society gives fashion companies a great opportunity to utilize for their advantage (Ozdamar & Atik, 2015).

Apart from that, culture is also a very important aspect of consumer factor that enables the growth of the fashion industry. The people in a society have a specific culture that determines their tastes and preferences. For example, the millennial love clothes with flashy designs. The fashion company making clothes to target this market segment must, therefore, make clothes in accordance with their tastes and preferences. Suppose this condition is satisfied, the people will likely to buy the clothes and enable the company to make profits. As the company continually adapts to the culture, it builds a good brand for its products. By augmenting its products, fashion companies can easily win the loyalty of their customers, hence, ensuring a continuous flow of income in terms of profits from the massive sale of its products. Culture of the people highly encourages innovation of more clothing styles to enhance continuous augmentation and satisfy what customers' desire.

Increase in the population of customers is another factor important for the growth of fashion companies. As the number of customers buying a company's products increases, so do its sales and profits. The company has to look for more creative ways to win the trust of other customers and maintain them. Therefore, the increase in the population of customers is an enabling factor that enhances the growth of the fashion industry (Nadeem et al., 2015).

Technology

Technological advancement plays a huge role in enhancing the growth of the fashion industry. As new technologies arise, fashion companies benefit from it in several ways. First, the fashion industry can use technology to enhance production. Nowadays, companies can take a short time to bring the clothes desired by their customers from a concept to a finished product. The use of robots has made it very easy for companies to come up with thousands of designs which suit the tastes of customers in a given society (Macchion et al. 2015). The technology helps fashion companies to collect data concerning consumer tastes and preferences. The data is interpreted, and then the suitable designs and styles are born. After that, efficient technology helps in designing, manufacturing, marketing, advertising, and enhancing sales of these clothes. With technology, the whole process is fast enough to catch up with the rapid trends of fashion that normally change from time to time. In addition to that, technology provides the most effective way of determining the effective raw materials for making clothes, forecasting demand for various clothing designs, and enhance effective production of the best clothe designs having high market demand. Furthermore, technology enhances creativity and innovation. Improving the designs and creating unique styles require technology to aid in doing so. Various computer programs and software help in creating unique designs and styles that address consumers' desires. For example, Computer-Aided Designs (CAD) and Computer-Aided Manufacturing (CAM) software have a great capacity in developing creative designs and manufacturing prototypes, production runs, and finished products for consumers. An integrated CAM/CAD system can help in developing the fast solution of designing through manufacturing, making the whole process cost-effective, efficient, and effective (Ozdamar & Atik, 2015).

Political Factors

The government might make some policies that highly encourage the growth of the fashion industry. For example, when the government imposes a low tax on fashion products, the fashion companies will have larger amounts of profits from their sales due to low taxation. The government may also enable the growth of companies in the fashion industry by showcasing their fashions to customers in other countries. This creates a brand name which customers believe to be of quality and therefore encourage them to buy from companies from that country (Pierce & Schott, 2016).

Economic Factors

During the period of economic boom, consumers have more disposable income. Hence, they are more likely to buy more clothes from retailers, wholesalers, or manufacturers. The availability of disposable income leads to an increase in sales of clothes and the subsequent increase in profits. The profits gained through such massive sales can enable fashion companies to make more creative styles that will enable them to maintain sales even when it is time for the recession.

Factors Inhibiting the Growth of Fashion Industry

There are various factors that inhibit the growth of the fashion industry. They include rapidly changing customers' tastes and preferences, political factors, low economic conditions, and stiff competition. These factors are discussed below.

Rapidly Changing Consumers' Tastes and Preferences

Consumers prefer wearing different clothing styles for different seasons. The styles differ according to the tastes and preferences of consumers all year round (Macchion et al. 2015). The companies must, therefore, continually invent better ways to produce the styles that best fit consumers' tastes and preferences. The continuously changing tastes and preferences make it very difficult for fashion companies to produce large quantities of clothes to be sold for a long period of time. Instead, they must only produce the quantity enough for sale during a short period of time to avoid loss due to excess production. As the company switches from one production line to another, it takes quite a long period of time to complete the whole process such as designing, manufacturing, marketing, advertising, and selling the finished product produced by the company. For this reason, the rapidly changing consumers' tastes and preferences serve as an inhibiting factor for the effective growth of the fashion industry. As a result, many fashion retail stores face closure every year. For example, some of the fashion retail stores that closed in 2018 include Claire's, Best Buy Mobile, Abercombie and Finch, Foot Locker (110 stores), Sears and Kmart (103 stores), among many others (Kleinhuckelkotten & Neitzke, 2019). In 2019, many other fashion retail stores have announced the closure of their stores. Some of them include Gap, Tesla, Family Dollar, Gymboree, among many others (Kleinhuckelkotten & Neitzke, 2019).

Political Factors

Some political macro-environmental factors have been known to influence numerous enterprises in the fashion industry. For example, child labor laws and workers' rights have affected the operation of many clothing companies. Employees working in clothe-making firms may picket their employers if they feel their wages and medical benefits are low and undesirable. This might lead to unexpected delays in the production of fashion styles needed by consumers in a particular season. Human rights activists may also picket wholesalers and retailers purchasing their clothes from countries known for violating the rights of workers and children. This makes them find alternative supply sources. As a result, the clothes manufacturing firms that have been abandoned may end up closing due to inadequate sales that cannot let them maintain production (Nadeem et al., 2015).

Low Economic Conditions

The recession has been known to affect small fashion retailers negatively. During recession periods, people have low disposable income. Low disposable income leads to low ability to buy clothes. Hence, when the economic condition does not favor consumers, the retailers, wholesalers, and manufacturers will also feel its effect in the form of low sales, which translates into low profits. As firms make low profits continuously, they end up decreasing in their operations and may decide to close some or even all of their stores (Ozdamar & Atik, 2015).

Stiff Competition

Currently, there are numerous enterprises dealing in making and selling clothes. Big companies that have already established in the market suppress the smaller ones making them not able to come up and grow. The larger fashion stores have acquired a wider market share and numerous loyal customers. It, therefore, becomes very difficult for up-coming small businesses to establish in the market to gain substantial market share. Stiff competition is a very risky factor that is able to cause the closure of many fashion retail stores (Pierce & Schott, 2016).

Impact of the Factors on Opportunities for Change and Innovation in the Fashion Industry

The factors discussed above have played an important role in driving change and innovation in the fashion industry. The following are the specific ways through which changes and innovation have been realized in the fashion industry.

Consumer Factors

Consumer factors such as cultures, norms, lifestyles affect their tastes and preferences and consequently affect their buying behaviors. The tastes and preferences of consumers continuously change rapidly making it very difficult for retailers, wholesalers, and manufacturers to catch up with it. The rapidly changing consumers' tastes and preferences have made various clothing enterprises to change their business dimensions and organizations. For example, many fashion enterprises have changed from brick and mortar stores to online stores. Everything has become so much digitized to capture a wider reach for prospective customers worldwide. Many fashion enterprises are involved in online marketing and online sales via social media platforms such as Facebook, Twitter, Instagram, among others. Through these social media platforms, customers are able to view and order goods online and have them delivered to them (Kleinhuckelkotten & Neitzke, 2019).

Technology

Advancement in technology has impacted the fashion industry si...