Crisis

How the Pandemic Changed Wholesale Buyers’ Habits

The crisis forced the whole industry to quickly increase their online presence and this choice will probably pay off on the long run.

It’s a given that the Covid-19 pandemic changed the fashion industry’s distribution patterns in a number of ways. If fashion executives were at first divided on the outlook for their industry, as underlined by a report published last year by McKinsey (State of Fashion 2021), most of them knew from the start that the crisis would make the online sales channel vital and change the way wholesalers and retailers placed their orders.

“There was a lot of confusion when the pandemic started. Budgeting plans and projections were all distorted with stores being forced to close and one of the few options left was to switch to, or focus on, the online”, explains Christian Daccache, founder of Bureau des Créateurs, a Middle East consultancy firm based in Dubai and specialized in strategy, wholesale and public relations. “Big brands weren’t affected as much as small ones, who took the hit, especially those who still hadn’t opened an online channel at that time,” he adds. “In the Gulf, the first months had almost no effect, and then the industry really felt the hit during the release of the summer collection and the following one,” continues Daccache.

For Zineb Britel, founder of Zyne, a brand that creates and sells handcrafted shoes by female artisans in Morocco all over the world, the transition was still harmful for a lot of designers. “During the first months of the pandemic, many retailers canceled their orders or modified them to match a mutating demand,” she recalls. For many customers locked in their house, gym clothes and lounge wear became more sought after than more formal, fancier clothes, this, among other signs, betrayed the change in customer behavior and sentiment.

Creativity and flexibility
“Some designers took the hit, but others managed to bypass it, depending on their ability to adapt quickly to the new circumstances. That was our case. We were able to keep the new orders coming, from retailers [Zyne considers orders under 300 pieces as retail] as well as from wholesale buyers [any order over 300 pieces]”, she adds. The cap that separates retail orders from wholesale depends greatly on the size of the business and the type of products. For some businesses, an order of 30 pieces could be considered as wholesale.

The ability to keep the wholesale orders coming remains vital for fashion designers of all sizes and types. “It’s a welcome chunk of money,” says Roni Helou, founder of his eponymous brand that specializes in ready-to-wear pieces, and that mostly sells their products in London, Dubai and Kuwait City. A most welcome chunk, especially when the pandemic forces “the big online shops to focus on supporting the brands they already had, which is an issue for designers who are trying to expand,” according to Helou.

Of course, some of the best weapons for any entrepreneur looking to keep the wholesale revenues flowing are to remain creative and flexible, while negotiating prices, simplifying the distribution process and adjusting order quantities and volume. The only constant is that the pandemic forced the whole industry to quickly increase their online presence and this choice will probably pay off on the long run. According to the Fashion E-Commerce Global Market Report 2020-30: COVID-19 Growth And Change published online in July 2020, the global fashion E-commerce market is expected to recover from the pandemic by 2023, reaching 672,71 USD billion after a dip below 500 billion in 2020.