The fashion industry has expressed concern over political uncertainty, weakened consumer confidence and a drop in the value of the pound after the UK snap general election ended with a hung parliament.
The inconclusive outcome occurred after neither the Labour nor Conservative party reached the 326 MPs required to gain an overall majority in the House of Commons.
In a speech prime minister Theresa May said Brexit negotiations will begin in 10 days as scheduled: “The Government I lead will put fairness and opportunity at the heart of everything we do, so that we fulfil the promise of Brexit together and - over the next five years - build a country in which no one and no community is left behind. What the country needs more than ever is certainty.”
However fashion bosses told Drapers they were worried about the repercussions for trade and the impending exit for the European Union.
“I was surprised by the outcome, which is the worst of all worlds,” said Joe Browns chairman Derek Lovelock.
“The uncertainty it will cause will impact all corners of the economy. It will cause difficulty with consumer confidence – it’s not good for retail. As retailers, we would all have liked a result that would have strengthened the pound, but of course this hasn’t happened.”
Berwin & Berwin managing director Simon Berwin said: “We were walking through treacle as it was and now there is more uncertainty. It will make Brexit negotiations 10 times harder as they haven’t got the strength or authority to do it. It makes us a laughing stock to the rest of the world. The result will make business which is already difficult even more difficult. It’s one of the saddest political days I’ve seen in the last 25 years.”
The managing director of one womenswear multiple said agreed: “We really need clarity, certainty and confidence as we go through the Brexit ‘process’ – sadly don’t think this election result is going to help provide any of that.”
Supergroup co-founder Julian Dunkerton said: “It will be very interesting to see how it all plays out, and how the new government will deliver Brexit. I’d like to see a Tory-Liberal Democrat coalition, but I don’t think this is likely to happen.”
Colin Temple, chief executive of Schuh, said: “It’s not ideal, uncertainty is never good for business. Retailers like continuity. There will be a shake in confidence on big ticket items but for disposable items like fashion and footwear inflation is a bigger issue.”
Independent retailers agreed the result breeds instability in the market.
“I don’t think anyone can say it’s a good thing. We just need stability,” said Darren Hoggett, co-owner of J&B Menswear in Norwich.
“We need someone to start the Brexit negotiations. From an independent point of view we’ll be a bit cautious with spring buying, but there’s been a slight squeeze on people spending anyway. The majority of our customers are self-employed and wanted a Conservative majority.”
Deryane Tadd, owner of The Dressing Room in St Albans agreed: “What we need is stability. We’ve got enough going on without anything more being thrown in there. I would have rather had a more stable result.”
William Coe, managing director of the Coes department store chain, said: “It’s achieved the direct opposite of what Mrs May wanted. The last thing we wanted was more uncertainty, so we’re deeply disappointed.”
Carl Macklin, managing director of Agatha Boutique in Lincoln, said: “It’s a disaster. It should have been Labour or Conservative. A hung parliament is the worst of all outcomes. We’re going to be a very, very unstable country, especially with Brexit.
A spokeswoman for the British Fashion Council said: “It is an interesting time and it is difficult to predict what is around the corner, but we will continue to work with our network in government and business.
“As an industry worth £28bn and which employs 880,000 people, it makes sense that the government will support us putting our talent, culture and the global reputation of London and the UK at the heart of a sector deal for fashion and the broader creative industries. It is also important that we remain open and accessible to international talent, which has, for many years, helped give the industry the dynamism and diversity that drives its global appeal.”
Ed Cooke, chief executive of shopping centres body Revo, said now was the time for “bold leadership and for decisive government”: “For too long, there has been electoral uncertainty and today’s mixed result means the parties must now come together in the national interest to form a viable government as soon as possible. The primary concern for retailers and other occupiers at home and abroad is the overwhelming burden of business rates. Whatever shape the next government takes, it must deliver reform to the system, and reduce the burden, to allow our industry to thrive and prosper.
“We await the outcome of negotiations, but our businesses cannot be left wondering indefinitely. It is vital that the needs of businesses invested in towns and cities across the UK are not overlooked in the coming days.”
Daniel Harden, head of desk at foreign exchange specialists Global Reach Partners said: “This snap election has not only backfired politically for the prime minister, it has also resulted in more turmoil on the currency markets. Sterling fell by around 2% against the US dollar when markets opened today. Earlier it sank to its lowest level in more than a month in Asia, while stocks within UK-exposed companies were among the worst performers in that region’s markets.
“This is hardly the strong and stable outcome May had envisaged. With Brexit talks now set to begin in earnest and May saying she will hang on as prime minister, at least for the time being, the pound is set for a rocky ride in the months ahead.”