EU & US apparel consumption to reduce by $300 bn: Wazir

Peak of new COVID-19 cases is expected between end-April to mid-May, based on which lockdown is expected to last till mid-July, as per Epidemic Projection by BCG, made on March 26, 2020. This implies total 3 to 4 months closure for almost all the brick-and-mortar fashion stores across US and Europe.

During the lockdown, online stores remain the only option to buy apparel, but consumers are primarily focusing on grocery, medicines and staples purchase. Apparel purchasing will largely be delayed as there is no urgency to replenish, uncertain economic scenario, reduction in occasions to go out (schools, offices, restaurants, gyms, etc are all closed), and limited product options and late and expensive deliveries (online stores), says the report 'Impact of COVID-19 Scenario on European and the US Apparel Market The Big Fall: EU and the US Apparel Consumption to Reduce by US$ 300 bn.'

"US as a society is more consumerist compared to Europe. Younger population with a habit of regular spending will cause US to maintain a tad higher consumption than EU during the lockdown period; and more importantly, faster return to normal consumption levels," the report states. It estimates 37 per cent less consumption due to store closures in the US market, and the country's GDP shrinking by 3 to 4 per cent. Expected net impact would be 40 per cent lower apparel consumption in 2020.

"European economy was already under stress for last couple of years and countries like Italy and Spain, having been hit worst by the epidemic will cause lower level of consumption than the US in 2020," the report mentions. It estimates 41 per cent less consumption due to store closures in the EU market, and the GDP shrinking by 5 to 6 per cent. Expected net impact would be 45 per cent lower apparel consumption in 2020.

Click here to read the report.

Fibre2Fashion News Desk (RKS)