With the slowing down of the economy, India will experience a collapse in the fashion industry as orders from retailers decrease. Retailers are already under a huge burden of unsold inventories.
Manufacturers say that they did not receive any virtual orders from domestic fashion retailers in the month of May and June which is considered to be peak business months. They also predict that there would be no improvement in July as well.
A tweet said that H&M refused to pay for the work done and cancelled all orders. Due to this several workers had protested outside a factory in Bengaluru that produces goods for companies including H&M.
Most of the fashion brands are looking to sell their unsold summer inventories until October. This will result in a decrease in the fresh orders and many factories might close down with workers losing their jobs.
Kulin Lalbhai, Executive Director of Arvind Ltd said that “All retailers would be liquidating the inventory for the next two months and once there is an improvement in the inflow of cash they would start placing new orders.”
Although lockdown has been relaxed in most of the states, footfall in the shopping malls and showrooms have decreased by 25%.
Rakesh Biyani,Managing Director of Future Group says that “The current situation of the retail industry is worse. Almost 60-70% of sales are required to curb this loss. Hence, domestic retailers are refraining themselves from placing new orders.”
The Retail Association of India representing many outlets predicted a decline of 70% in the business from June 1 to June 15.