Suppliers are facing a difficult start to the new season as unpredictable weather and fluctuations in the value of the pound following the Brexit vote lead retailers to take a cautious approach to buying.
Retailers are increasingly reluctant to place orders with long lead times and many are placing smaller orders, concerned suppliers told Drapers.
One womenswear supplier source said: “Retailers are playing it very safe and they’re being very cautious about what [orders] they’re placing. Orders are very slow to come through and when they do come, although they’re not necessarily small, they are much smaller than they were last season.
“They will only place an order with a long lead time if they absolutely have to. It can become a vicious circle because if the product isn’t special enough, consumers will buy even less.”
Other sources said orders are being placed later and suppliers are under pressure to drop their prices. One large supplier said: “Most of our retailers are not prepared to see any increase in cost prices year on year. They’re definitely more cautious and having more trouble in signing off ranges and making definitive decisions, which has meant lots of sampling and redirection in the development process. We would also normally be looking at and having discussions about AW17 by now, but most retailers haven’t even put their sights on next Christmas yet, which is very unusual.”
Another source, who supplies to high street multiples, said orders are being placed later and suppliers are under pressure to drop their prices.
“Retailers are pushing very hard on price and that’s affecting suppliers – no question. They’re definitely leaving it later to place orders as well. After Brexit, people didn’t know whether to go big with their autumn programmes and it’s taking time to recover. It’s been very, very tough for retailers over the past three weeks or so. Everyone you speak to is well down on last year. We always blame the weather, but it certainly hasn’t helped.”
This was confirmed by the British Retail Consortium and KPMG’s Retail Sales Monitor for August, which showed total sales were down 0.3% year on year. It said the sunny weather dissuaded shoppers from buying the new autumn collections.
However, one highstreet womenswear supplier told Drapers he thought retailers were starting to prioritise quality over price following disappointing summer sales.
“It is true retailers are less keen to buy on a long lead time, but they know they need to be getting newness into store and they’re having to be brave. Some made some own goals in the past by trying to go cheaper and now they’re thinking more carefully about the quality of the product and the attention to detail rather than worrying about whether it’s £2 or £3 cheaper.”
He added: “Lots of retailers are going down the direct route and it’s backfired.”