On July 20, Japanese clothing retailer Cecil McBee announced it would close its 43 physical stores by November. Once the representative of “gyaru” fashion, which peaked in the late 1990s thanks to women in their 20s, the brand is believed to have taken its name from an actual American jazz musician without his consent and was later sidelined by the rise of so-called fast fashion — inexpensive clothing sold by international retailers such as H&M and Zara. As with so many other retail-related businesses, the apparel industry has been hit hard over the past six months by the novel coronavirus pandemic, and, as a result, the company that owns Cecil McBee has had to face reality: People aren’t going out to shop as much as they used to. The company has decided it will now focus on online sales.
This pattern has accelerated during the pandemic as the public self-isolates and works more from home. The ramifications for the apparel industry are doubly fraught. It’s bad enough that people aren’t shopping at brick-and-mortar clothing stores, but without having workplaces or recreational spots to go to, people also have no reason to buy new outfits. And when you think about that subset of the industry that is all about fashion, the problem gets worse. The word “fashion” indicates a sensibility that requires refreshing one’s wardrobe from season to season. The business model depends on people buying clothes when tastes change, but if there are no opportunities to show off one’s tastes, then what’s the point? No one cares what you’re wearing during a Zoom conference.
This dynamic has been covered by news outlets abroad, but not so much in Japan, which is odd. Japan has always had a relationship to fashion that transcends the usual class distinctions associated with designer clothing. The 1980s and the expansion of the asset-fueled bubble economy saw the ascent of DC (designers, characters) brands, clothing companies that operated like high-end fashion houses but catered to the middle class and younger consumers. Expensive foreign brands caught on and opened stores in Japan, selling clothes and accessories to middle-class Japanese people.
As a result, Japanese fashion — and the Japanese apparel industry in general — has always had an enviable international reputation based on proven profitability; or it did, until the fast fashion movement gained velocity.
More traditional brands might seem to be impervious to fashion’s serendipities, but, as the Asahi Shimbun reported on July 18, the clothing company Onward Holding Co., has, like Cecil McBee, decided it can no longer continue the way it has, and announced that it would stop its seasonal marketing scheme, which, following fashion conventions, involves selling wares at premium prices for each season and then getting rid of the leftovers with end-of-season clearance sales. Onward will close about 1,400 outlets over the next 19 months and move into online sales, mainly through the sales portal Zozotown.
Onward is one of three long-established Japanese clothing makers that are in deep trouble right now. The Asahi Shimbun also reported that Renown Inc. saw its stock value plunge to ¥4 a share on June 15 and is now in the process of court-supervised rehabilitation. The third apparel company, Sanyo Shokai, which was once licensed to peddle Britain’s iconic Burberry brand in Japan, is selling its building in the Ginza shopping district of Tokyo, which it renovated just last year.
Another Asahi Shimbun article profiled “battaya” businesses, which buy leftover inventory in bulk and then resell it at greatly reduced prices. The president of one such company, Shoichi, told the newspaper that he deals with about half of the top 20 apparel companies in Japan, and that his business is booming (¥1.8 billion in annual sales) because Japanese clothing makers still insist on the excess production model. According to a 2016 trade ministry report, the domestic clothing market shrank from ¥15 trillion in 1990 to ¥10 trillion in 2010. However, during that same period, inventory doubled. Traditional clothing makers and DC brands mainly sold their products through department stores, which, prior to the end of the bubble economy, were the preferred retail outlets for consumers buying new clothes. Companies competed for space in department stores, and this kind of rivalry necessitated full shelves, which, in turn, mandated premium prices.
Despite the fact that department store fortunes have been declining for decades, this supply model has not altered significantly, and the trade ministry warned in the 2016 report that it would have to if clothing makers were to survive. The pandemic has made that point inescapable in more ways than one. Entrepreneur Shinobu Naito recently wrote that Brooks Brothers, whose line of suits practically define so-called trad fashion, has seen its fortunes plummet in Japan because it refuses to respond to “new trends toward casual clothing.” Shedding an image based on a brand’s success in the past is extremely difficult, he says, and now that office clothing is increasingly casual, Brooks Brothers has become something of an anachronism.
Naito says Brooks Brothers’ problems are not only about the two factors that the Nihon Keizai Shimbun article insists are behind the collapse of the apparel industry: the pandemic and a reluctance to digitize. Branding no longer means what it used to.
Consumers may be attracted to certain makers, but it has less to do with brand image than with more immediate concerns like price, need and comfort. If brand image means anything any more, it has to do with corporate policy.
In a July 14 report on Diamond Chain Store Online, business consultant Taku Kawai says that “sustainable management” has become the buzzword in the apparel business. Some Japanese companies are now thinking of ways to recycle clothing to their advantage. None have reached the logical end of that idea the way the outdoor clothing maker Patagonia has. Patagonia tells its customers to not buy their products if they don’t really need them, a business approach that is the antithesis of “fashion.” After all, in cyberspace, nobody can see your Cole Haan shoes.
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