Clothing and footwear: liquidations and “recycling” to save the winter collection


In a normal year, the winter clothing and shoe sales start strong in June and gain scale in July.

But this April 2020, there are already a majority of clothing brands that promote on line discounts of up to 40 percent, payments in 12 installments without interest and promotions of two or three for one on clothes from the new collection, as well as extra discounts in the remainder of the summer already in comes out.

The crisis and the preventive isolation forced by the Covid-19 aborted the usual cycle of fashion: when hundreds of clothing, footwear and accessories brands in the country began to show their winter 2020 collections on stained glass and on social networks, all the sector had to lower blinds and freeze.

Today, the industrial links of that chain cannot work, the physical shops are closed and only the sale on line it is allowed, albeit with enormous difficulties.

One of them is delivery: most brands do not have access to their warehouses due to quarantine and therefore cannot dispatch orders.

Another is the consumer, withdrawn by the drop in income, economic uncertainty and closure.

Thus, winter clothing and footwear remained, in the largest-scale brands, manufactured, half-distributed and unsold. And in many, smaller, half-manufactured.

The payment chain is just as devastated: the investment in the winter collection has already been made, but now, when it is required to recover it and finance the summer collection, the sale is zero.

The universe of bounced checks and canceled orders between manufacturers and merchants is vast.

Aggressive settlements

What will happen to this deadly wounded winter season before birth?

Brands rehearse strategies amid uncertainty, a process that occurs in the world.

With nuances, in the sector they coincide in a double destination for winter 2020 garments and footwear: very aggressive liquidations, wholesalers and retailers, allowing circulation stock, at cost even in cases where it is necessary to have money.

Added the saving of part of the products, especially those that do not get to be shown, for the next winter.

Directors of the shopping malls Cordovan coincide: if the doors open in the second part of winter, fashion brands will have to apply strong discounts to capture the consumer and become liquid.

“The way the weather occurs influences, but winter is sold until July. In August, even if it is cold, people do not buy winter,” explains Antonio Truisi, owner of Monimar, a wholesaler of lingerie and corsetry with 40 years of experience in Córdoba.

In addition to selling (to businesses and the public) and distributing national brands, such as Cocot, Selú and Aretha, it manufactures children’s clothing under its Narin brand.

“If there is an opening, there will obviously be liquidations, because both manufacturers and merchants will need to sell to cover costs and buy in the summer,” adds Truisi.

Conte Calzados is another local brand that will bet on discounts. “We are about to launch three for two: they pay for two pairs of shoes and they carry three,” anticipates Marcelo Nasif, managing partner.

The company that manufactures and sells footwear has five of its own stores closed since March 20. The only movement it registers is something for sale on line that seeks to promote.

“We had the logistics developed. But in this context it cannot be well distributed, so we sell with delivery at the end of the quarantine,” explains Nasif, who also anticipates a season of high liquidation.

“National brands are already with aggressive promotions,” he says. Of course, the price level in some is very high and offers a wide margin for discounts.

Typically, after one season, a store can keep a balance of 20 percent of its collection.

In general, that seeks to be liquidated almost completely. This year, the threat is that the entire collection will be left over.

Nationally, for example, shoe manufacturers claim to have 30 million pairs ready with the threat of not selling and “going out of style”.

The fashionable carousel, on hiatus

The Covid-19 detonated the almost paralysis of the so-called “fashion system”, that profuse calendar of weeks of international fashion shows and fairs that are based in the northern hemisphere, with an epicenter in cities like Milan – a strong target of the pandemic -, Paris , New York and London.

Argentina is part of the group of peripheral nations that follow the guidelines in terms of colors, types of garments, morphologies and styles that are dictated from that circuit to the world each season, today the target of cancellations and reprogramming.

This stoppage is believed to result, globally, in a much smaller or more tenuous change in “trends” from one year to the next, favoring the recycling of collections.

“The liquidation was advanced a month. Today we are with shares on line very strong, accumulated discounts reach 50, free shipping after quarantine and up to 12 installments without interest. We are showing only things that are in stock and also garments that we imagine people can wear in this context, “explains María Marta Finelli, product manager for the three Mazalosa brands: Portsaid, Desiderata and System Basic.

Portsaid is one of the female labels with the highest sales volume in the country. Its winter collection, made up of 800 thousand units (clothing, footwear and accessories) is already manufactured (part here and part in Asia) and partially distributed on the network of 50 own stores, as many as third-party stores and the digital channel. The summer one is also designed and partly made.

“We are making decisions on a daily basis, because this never happened. We see that there is a certain response from the consumer on line Although we cannot deliver so far, we hope to be able to access our warehouse in the future, “Finelli added.

“When the locals reopen, they will be entering the product that they can, and we will be very competitive with the prices so as not to lose merchandise. I think there will be many aggressive liquidations,” he anticipates.

Finelli agreed that part of the collection will be saved for next winter or will be reassigned to the summer season.

“That happens worldwide, we are not going to be barefoot in terms of fashion and trends. In fact, we already see it; we share suppliers with Zara and they also cancel orders and spend them in season,” explained the product manager.

Like others, the brand also rethinks and reclassifies the summer collection. Clothes such as shirts, pants, t-shirts or jeans from the proposed winter, which can be worn in the summer, will jump to that season.

Only half

For Héctor Luna, vice president of the Chamber of Wholesale Merchants and Industrialists of the province of Córdoba, there will also be a combination between “saved” for next winter and strong liquidations.

“It depends on the brand, but 50 percent of the collections can survive fashion and therefore be saved. I think there will be very strong wholesale liquidations, to place stocks already manufactured. The public too, but managing the price is a balance there, “he says.

As he explains, brands have a floor, not only in cost, but also in terms of positioning with the consumer, which they cannot pierce.


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