The fashion business

 
Models present creations for the Simongao collection during the 2014 Autumn / Winter London Fashion Week in London

We know that clothing is big business, but it may be surprising just how big.

The fashion industry's contribution to the British economy is an estimated £26bn - that's twice the size of the car industry's and nearly as big as the contribution from housing, according to the British Fashion Council.

It is not just dresses and handbags, but also design and manufacturing that make the sector the largest part of the so-called creative industries, which include marketing, etc.

It's an important part of the services sector that makes up around four-fifths of the economy. And services has powered the economic recovery, which I have written about before.

I wrote then that it was a tougher sector to picture than say manufacturing cars which is tangible. Intangible services like business services or design are harder to see.

But a couple of times a year during London Fashion Week, it is visible as models wear dresses that embody design as they sashay down the catwalk. And it's also seen on the red carpet where actresses and singers generate publicity for labels as they come and watch the shows.

In the five days of London Fashion Week, about £100m of orders are placed for that season. Two-thirds of the buyers are international. As with many businesses, it's a global market. That was clear from the fashion entrepreneurs that I interviewed, Tom Ford and Anya Hindmarch.

It's also an industry that has taken to social media to reach that market. Burberry livestreams its catwalk show, so potential customers can watch online wherever they are. It's a rare billion-pound British fashion house and that is due in part to having a large social media presence that has global reach.

It also means that it is a fiercely competitive business where it's hard to stand out unless you're a well-known brand and even then, it's easy to fall in and out of fashion (sorry for the pun).

An estimated 95% of start-ups fail in the first five years, according to Imran Amed, who blogs on the "Business of Fashion". That's higher than that of other small firms where one-third won't survive beyond the first three years.

Behind the catwalk and glamour, fashion entrepreneurs face the same challenges as other businesses seeking to stand out and attract customers. As I spotted various fashion editors in the front rows, it reminded me of the movie The Devil Wears Prada.

In addition to design, production, staging and selling to the retailers who are in the audience at the shows and to customers globally, the designers have to impress the fashion magazines whose publicity could be worth literally millions.

More on Talking Business with Linda Yueh is broadcast on BBC World on Friday at 14:30 GMT, on Saturday at 00:30 GMT and on Sunday at 12:30 GMT and 18:30 GMT. In the UK it is broadcast on the BBC News Channel on Saturday at 20:30 GMT.

 
Linda Yueh Article written by Linda Yueh Linda Yueh Chief business correspondent

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  • rate this
    +1

    Comment number 18.

    2. alan
    Why can't we have more quality men's clothing made in the UK?
    A lot of the Chinese stuff is rubbish and falls to bits.
    I want a pair of trousers which last ten years not ten weeks.
    ---
    Then don't buy your trousers from Primark for £2.50 a pair.

  • rate this
    +3

    Comment number 17.

    12.alan
    Burberry, Daks and Aquascutum make great British Ourwear.
    Barker, Loake & Church's make great shoes.
    Saville Row is full of the best suitmakers on the planet.
    Jaeger, Hackett and Reiss make quality casual clothing.

    The UK fashion industry is huge and very profitable. It is known worldwide for quality, over and above the Italians and even the French.

  • rate this
    0

    Comment number 16.

    I am sure the fashion business reaps rewards for Britain, but how come we get to comment on this when we are not allowed to comment on the unemployment figures and the fact that last week it was revealed under the incompetent IDS this Tory led government do not even have accurate figures to measure it, I realise Red Dave and Red George want to embrace all things Chinese but is this a bit too far.

  • rate this
    0

    Comment number 15.

    Abroad people adore the British style, tweed,brogues; the restrained elegance, it's the British who ought to get behind it and celebrate it!
    Believe it or not there are things we do very well. , Burberry, E. Tauze etc.

  • rate this
    -4

    Comment number 14.

    Really? Linda, do you think this gentleman was helping promote the fashion business for Britain?

    http://www.bbc.co.uk/news/uk-26252091

    Very stylish, in'it?

  • rate this
    -2

    Comment number 13.

    How many male correspondents do you have in the fashion department BBC?!!

    Come on chaps, lets burn our briefs and get disproportionally irate and aggressive!!

  • rate this
    -1

    Comment number 12.

    Why can't we have more quality men's clothing made in the UK?
    A lot of the Chinese stuff is rubbish and falls to bits.
    I want a pair of trousers which last ten years not ten weeks.
    I'm into fashion, 20 years in advance.
    Are the belts which come with trousers made from cardboard?
    Also why are shoe laces about 2m long these days?
    You need to tie them several times to stop tripping up.
    Alan

  • rate this
    +6

    Comment number 11.

    We are such a talented nation.Technology, the arts, medicine, science and the best 'ideas' people in the world and must mention music. We are brilliant at hiding our talents under a bushel.

  • rate this
    -1

    Comment number 10.

    It's the vain British society that fuels the growth. You know the "look at that, her, it " types. This country houses plenty of them folk.

  • rate this
    -2

    Comment number 9.

    I suppose we really have to thank the sheep mob for buying 'The Latest' totally over priced items that are not worth the materials it is made of within a week of purchase! They really do help industry make nice healthy profits! So keep on buying you sheep like folk...Baaaah Baaaaah Baaaaah

  • rate this
    +1

    Comment number 8.

    There might be British fashion designers for wealthy British people. However, for the rest of us plebs, we are left with the scraps derived from cheap Chinese and Pakistani imports. The £26Bn that is suppose to comprise the industry in the UK then much of it is adding to the balance of payments deficit. Given the nonsense in Yueh's piece, it might as well be written by Edina Monsoons PA.

  • rate this
    0

    Comment number 7.

    Personally I blame the fashion industry for forcing me to live in a home inhabited by more clothes, handbags and pairs of shoes than any sensible wife could possibly wear in an entire lifetime. It might contribute billions to the overall economy but certainly doesn't do anything for mine.

  • Comment number 6.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    -4

    Comment number 5.

    Fashion's contribution to the economy is vastly over-estimated.
    Most of what is sold on the high street is made in foreign sweatshops anyway.
    The so-called high fashion is tasteless tat for fools, rich fools, but fools none the less.
    From the designers, through the models to the vacuous buyers there's precious little to admire.
    So what if it turns a coin, so do drugs, guns, gambling & prostitution

  • rate this
    -5

    Comment number 4.

    I dont call it the "fashion business" I call it the trash business, because we are all supposed to follow fashion & trash/waste older clothing just because it is last years colour/design.

    Personally, I do not aspire to be a sheep,

    For goodness sake, this seasons/years fashion colour is orange, the most grotesque colour to be seen in, only a mug would be foolish enough to buy into it

  • rate this
    -4

    Comment number 3.

    Ever since we closed most of our factories and shipped out large numbers of our decent industrial jobs we have to rely on this sort of ephemeral, exploitative rubbish to pay the bills. So lets hear it for Posh Spice the saviour of universe

  • rate this
    -3

    Comment number 2.

    I love a pretty frock....but AMAZING is fast becoming the most overused word in the English language.

  • Comment number 1.

    This comment was removed because the moderators found it broke the house rules. Explain.

 

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