The autumn season signals a new term for fashion retailers. The industry is readying itself for the crucial peak trading period, which is currently being overshadowed by unseasonable weather, persistent inflation and a gloomy economic outlook.
Retailers desperately need a boost in the all-important “golden quarter”: this year after a disappointing summer trading period. Last year’s peak season was hampered by rocketing energy costs, which fuelled the cost of living crisis and dampened discretionary spend as the economy threatened to tip into recession.
Brands and retailers are tightening up stock levels, offering transitional product for consumers who have an increasingly “buy now, wear now” approach and are hoping to hold off on early discounting as the peak trading season approaches.
“June [trading] was good, July was a bit mixed and August [was not] great [because of bad weather],” said the CEO of one fashion multiple.
Simon Poole, managing director of menswear brand Luke 1977, echoed this, telling Drapers that cooler weather was drawing consumers abroad, “which leaves the high street a bit quieter”: “[During August], we had a quiet Monday to Friday but decent weekends, thankfully. However, there is still a lot catching up to do.”
The British Retail Consortium (BRC) and KPMG’s Retail Sales Monitor shows that UK total retail sales increased by 1.5% in July, against growth of 2.3% in the same period in 2022. Wet weather and rocketing interest rates stopped shoppers updating their summer wardrobes, which led all categories of clothing to fall into negative sales “in what is usually a busy month for clothing retailers”, said KPMG’s UK head of retail sales, Paul Martin.
Over the past few weeks fashion retailers have started to bring in autumn/winter 23 stock, but they are focusing on transitional collections and postponing the roll-out of heavy winter products to better respond to the unpredictable weather and consumers’ “buy now, wear now” mindset.
Freemans increased its transitional offering by launching a new collection ahead of its main autumn/winter range
The CEO of one fashion and lifestyle retailer plans to take a more agile approach by keeping its visual merchandising and in-store products more in line with the weather, compared with previous years: “We will tiptoe our way through September and carry on in summer-facing mode while gradually edging towards autumn rather than a big autumn bang to keep our options open,” she said.
“This year, we will keep our window messaging and outfits more in line with the weather and respond on a weekly basis.”
Others are banking on transitional products to attract shoppers after a challenging summer season. Oliver Tookman, director of independent mini-chain Robert Goddard, which has 10 stores across East Anglia and the Midlands, said spring/summer trading has been difficult because of the poor weather and rising costs for consumers, but there is still a desire for newness with its early autumn collections performing well, especially Hugo Boss, Ralph Lauren and Mercery.
He added: “We ensure that our early autumn ranges are ‘buy now, wear now’ products, such as linen shirts, shorts and lightweight cotton knitwear. We are looking forward to autumn/winter, and hope the general mood in the market will improve.”
Similarly, online fashion retailer Freemans increased its transitional offering by launching a new collection on 16 August, ahead of its main autumn/winter range, which will drop in mid-September. The new New & Wow range features lightweight coats and knitwear designed “to be worn now or layered for later on in the season”.
Chief customer officer Richard Cristofoli said the retailer wants to be more “responsive, realistic and relevant” by adopting a “buy now, wear now” mindset and “breaking the legacy catalogue seasonal thinking that used to pervade our business”.
We ensure that our early autumn ranges are ‘buy now, wear now’ products, such as linen shirts, shorts and lightweight cotton knitwear.
– Oliver Tookman Director, Robert Goddard
Simon Donoghue, director of direct to consumer and group communications at French Connection, has observed an increase in versatile products such as separates as consumers look to achieve more looks with the same product: “We see [consumers favouring] versatility and staples. [We’re selling] more separates than dresses through the autumn/winter season so people can maximise outfits with as little spend as possible.”
Last year, subdued consumer spending panicked retailers into early discounting during peak trading season: many launched early, deeply discounted Black Friday and Christmas Sales. Retailers are expecting to cut prices as early and as heavily as last year, unless trading picks up during September and October.
The CEO of one fashion and lifestyle retailer said that peak trading this year “is likely to be promotional again”: “I think the market is tight, even though inflation and food prices are coming down. The economic backdrop is still present with the cost of living crisis affecting everyone, as well as the mortgage drama [interest rates continued to climb to 5.25% in August]. I think we will have a very stop-start build-up to Christmas.
“For Black Friday, we will be waiting to see how much of the general spending is self-purchase treats and how much is wholly gifting. We are hoping that the weather will change in time for there to be a gap and consumers will do a bit of self-purchase to change their autumn wardrobe. We don’t want people to go straight to spending on Christmas presents.”
French Connection AW23
The rate of UK price inflation slowed by 1.1 percentage points to 6.8% in July, driven by a drop in energy prices, the Office for National Statistics reported. However, it remains more than three times higher than the government’s target of 2% and also higher than that of the US (3.2%) and the Eurozone (5.3%) during the same month.
Luke 1977’s Poole said retailers will be forced to offer heavy discounts to boost consumer spending if September and October are slow: “For the autumn/winter season, we will have a battle to start with so we will need to give people incentives to spend.
“I think [shoppers] will start looking around for coats in October, but they will wait till Black Friday [to make the purchase]. I suspect Sale will be earlier and longer so similar to last year.”
James Hardiman, senior analyst at the British Retail Consortium (BRC), said persistent inflation will drive consumers to look for bargains this year: “Although it is widely anticipated that headline inflation will slow in the coming months, prices remain elevated and, with winter coming, people will naturally be spending more on their energy bills. So we expect shoppers will be looking carefully for bargains this festive period, particularly as many plan their winter wardrobes.”
The CEO of a premium footwear brand said it will focus on better buying and tight stock management for the upcoming autumn/winter season: “We had a cracking spring but in the back of our mind, we are keeping our buys reasonably tight.
“We’re mindful of the fact that the increase in mortgage payments still hasn’t hit for a lot of people. There is a caution in the market because nobody knows what’s around the corner. Let’s hope we see a little bit of economic recovery and interest rates don’t keep going up for too long.”
Meanwhile, the director of one UK clothing group is more optimistic: “Last year, we were going into Sale early because the market dropped off in October and didn’t pick up until Black Friday. But I think retailers and consumers both want to have a good run-up of seeing new products.
“There are always opportunities when the market is tough, so those who can get the right products, provide newness, get out of Sale and launch into new seasons will succeed.”
As the industry enters a new season, retailers are working hard to mitigate tough trading conditions and are responding to unseasonable weather by being more agile and offering transitional product. The industry is hoping to keep discounting at bay, and is keeping its fingers crossed that it will not encounter the same level of challenges as it did during the last golden quarter, when energy costs spiralled.