16 January 2023
4 min read
Fashion Industry Adapts and Evolves: Positive Sales Growth in 2022
Fashion closes the year on a bright spot. For the first time since 2019, the fashion trade in Spain has increased its sales, closing 2022 with a rise of 13.8%. Although the figure is positive, it is still far from the pre-pandemic turnover.
The year 2023 has kicked off with the sales campaign, in which the biggest discounts are on summer and autumn products, but not on winter garments, which the sector expects to be able to sell without having to apply significant offers to them.
The autumn-winter 2022 campaign has been good. In December, sales of fashion retailers in Spain recorded an increase in turnover of 8.3%, raising the pace compared to November and accumulating sixteen consecutive months of growth.
Throughout 2022, sales in fashion have evolved upwards without any month of exception. In January, the sector recorded an increase of 34.8% compared to the same month last year, affected by the pandemic restrictions. From March onwards, fashion sales in Spain continued to develop, with a rise of 11.7% in March and 10.8% in April. In May, the sector picked up the pace again, with an increase of 16.3%. During the summer months, the sector’s turnover moderated, with somewhat lower increases than in May, and in October the percentage was the least significant increase of the year, just over 4%.
Social commerce is experiencing a surge in engagement from brands, consumers and investors as new functionality and growing user comfort unlock opportunities for frictionless shopping experiences throughout the whole process.
In some markets, social media is fast becoming a preferred way of shopping and interacting with brands. By 2027, worldwide social commerce sales are set to reach over $600 billion!
Fashion companies face more threats such as risks relating to improper data handling than ever due to the digitisation of the sector reaching new heights day to day. Now, brands need to invest more to make digital security a strategic imperative.
Customer data collection and handling is now a critical weak spot for all online fashion businesses, since consumers are shopping in e-commerce shops more frequently while giving businesses access to valuable data during the process.
Closed-loop recycling is one of the most important levers that the fashion industry can pull to reduce its environmental impact. This system is now starting to be rolled out at scale and it is expected to limit the extractive production of virgin raw materials and decrease textile waste. As these technologies improve, companies will need to integrate them into the design phase for better product development.
Textile production needs more resources than many other sectors. In the European Union, the textile sector is the fourth-biggest consumer of primary raw materials and water, following food, housing and transport. Plus, the global fashion industry is responsible for 40 million tonnes of textile waste a year approximately.
There are some initiatives implemented to solve this problem as soon as possible. The EU’s Circular Economy Action Plan from 2021 incorporates an objective to ensure circular economy principles during the whole process. Meanwhile, the EU’s Waste Directive Framework requires countries to separate all textile waste by 2025, and several European nations have implemented extended producer responsibility schemes, making brands and retailers responsible for post-consumer waste.
Regarding, both the development and the risks that the fashion industry is facing today, the sector is showing signs of recovery but still has challenges to overcome in 2023 and in the future.