The fashion industry is ruled by giants—mega-corporations from fast-fashion behemoths Zara and H&M to luxury titans like LVMH and Kering, which between them own brands including Louis Vuitton, Gucci, Dior, and Saint Laurent. These are publicly traded companies with tens of billions in annual sales, and they make most of the industry’s profits.
But they’re not all there is. Fashion is also filled with a large number of smaller, independent companies with far more modest sales. The New York Times recently noted nearly 40% of the 477 members of the Council of Fashion Designers of America—US fashion’s governing body—earned less than $1 million last year. Most brought in less than $5 million. While it’s true everyone is suffering from Covid-19, for many of these companies the pandemic presents a nightmare scenario.
Independent designers often operate on tight budgets, using the sales from one collection to fund the next. Many still rely on selling wholesale to retailers for the bulk of their earnings, and may sell just a few items straight to shoppers. Either way, any delays or disruptions in their sales can interrupt their cash flow and play havoc with the whole business. They may be unable to buy fabrics, pay manufacturers, or cover other bills, such as rent if they have a store.