In the past few years, the fashion retail industry has seen significant changes. Today, fashion is more than just clothes. In fact, it is an expression and extension of oneself. This transformation in the fashion industry has led to driving purchases in the fashion industry. With increased product development, even an average person owns more clothes than they used a few years back. People have categorized their wardrobe into partywear, formals, casuals, beachwear, and sportswear.
The rise of e-commerce websites also has a major contribution to the growth of the fashion retail industry. This growth comes with a price on resources and finances for the brand. As there are plenty of apparel options available across thousands of brands, it is quite difficult to predict customer preferences. Let’s dive in deeper to understand the challenges faced by the fashion retail industry.
Top Challenges in Fashion Retail
1.Creating Unique Experience
Fashion retailers are extensively working to gain customer’s attention and creating an exclusive experience for the consumers. Only those brands who are successful in driving the engagement and attracting the audience will receive superior brand loyalty. To create such a unique experience, retailers have attracted customers by providing them tablets to research and buy their favorite products, implement click and collect model, and provide in-store entertainment.
2. Right Product to Right Customer
Brands come up with a new collection based on the seasons. Mostly, they roll out new designs every 2-3 seasons a year. It’s quite a longer time-to-market. Therefore, it is quintessential for brands to follow the right time, right place, right customer, and right price strategy.
3. Increased Interest in Online Shopping
One of the major challenges of the fashion retail industry is increased online shopping websites. The e-commerce websites offer an easy return policy and a study depicts that nearly 92% of consumers will buy again if the return policy is easy. These websites make online shopping more cheap, light, and risk-free while selling clothes. The success of these e-commerce websites has led the retailers in physical stores to apply the same strategy as the online stores. The growth of e-commerce has also created new behavioral habits in consumers. In addition to it, they see online networks as a good substitute for a local shopping center.
4. Sustainability
Concerns towards adverse environmental conditions are increasing and global brands are willing to take a more sustainable approach to product development. One of these measures is the circular economy model. Here the materials that would otherwise be headed to a local landfill are being reused to create new products. To adapt to this model, companies need more visibility and control over the recycled materials. Accordingly, for companies that have disconnected systems, siloed teams, inefficient processes, or the inability to access the information, it can be a significant challenge. It is because a responsible mindset requires tracking recycled materials throughout the Product Lifecycle Management process and tracking relevant data.
5. Discounting & Competition
To drive more sales, fashion retailers are more reliant on a discounting culture. This increase in the discounting culture has led to an increase in sale banners across the shopping malls and streets. Also, there are fashion retail outlets that are offering massive discounts on special occasions like Black Friday, Christmas, and Cyber Monday. Therefore, it is quite challenging for those players who wish to manage a healthy margin while their competitors are offering heavy discounts.
Final Word
Above all, the global fashion industry has experienced many challenges from major to minor. The industry works immensely to transform the fashion world with innovative solutions and sustainable products. The industry should also quickly adapt to changing consumer behavior so that they can deliver the right goods. Despite the challenges in the fashion retail industry from creating and streamlining a unique customer experience to price inflation and discounting issues, it is more interesting to be a part of this industry. It is because the fashion industry is committed to transforming all the challenges into greater opportunities.
