Wednesday, 21 June 2017

Why Are So Many Fashion Brands Going Out of Business?

Why Are So Many Fashion Brands Going Out of Business? Jaeger, Karen Millen, Ted & Muffy, Ben Sherman

Just this week I discovered that fashion retailer Karen Millen was going out of business... What the?! I was shocked that this happened three months ago and I hadn't heard about it before now. I immediately had a thought: why are SO many fashion brands going out of business at the moment?

This news (to me, anyway) has come hot on the heels of the news that Jacques Vert, part of the Style Group Brands, was facing a potential decline into administration (although they've since been bought out). I worked with Jacques Vert last year so it was quite a shock to see a brand I'd collaborated with face a demise. Also, menswear brand Ben Sherman was declared bankrupt last year - another shock from the high street, and one of my husband's favourites.

The biggest surprise, however, was Jaeger.

Jaeger - the brand that I had spoken of so highly back in October - was facing closure. Not only that, but it was a British brand that seemed to have been around FOREVER. It had, in retail terms: It was founded back in 1884 (that's over 130 years ago). However, it collapsed into administration in April and from what I've read it seems they will now only operate online and from in-store concessions.

THE NEWS THAT JAEGER WAS GOING BUST WAS A MASSIVE SHOCK TO ME. I THOUGHT THEIR CLOTHES AND ACCESSORIES WERE ABSOLUTELY DIVINE... HOW COULD THIS HAPPEN?

The news that Jaeger was going bust was a massive shock to me. I thought their clothes and accessories were absolutely divine... How could this happen? I've always loved just about every piece they've sold - I'd go on their website and want every. Single. Thing - and the same happened when I visited the new Marylebone store as part of my collaboration with them. The quality was beautiful, the colours were rich and flattering, the designs were modern. No longer the stuffy "old lady brand" they used to be, what they had been producing since their 2008 revamp was highly covetable.

So I was looking forward to an ongoing relationship with a brand I truly adored, but that was all over in a the blink of an eye (or a piece on the news). It's a shock AND it's incredibly sad.

Other fashion brands going (or gone) into administration

As I did a little research into which other brands had met the same fate over the past few years, I was amazed at how many well known fashion brand names there were. Some have closed altogether, others have been bought out or similar, but they all fell into a financial crisis at some point. To name a few (remember this is UK):

Jaeger
Style Group Brands trading as Jacques Vert, Precis, Windsmoor, Eastex and Dash
Karen Millen
Joy The Store
Theo Fennel
Ted & Muffy (formerly Duo)
Jones The Bootmaker
American Apparel
Banana Republic
Ben Sherman
Atterley
La Senza
Jane Norman
Barratts
(source: Centre for Retail Research)

This list is shocking - who knew that so many well known names could go out of business? Many of them are still trading in some form or another, but all of them were listed as under threat of closure. And of course I'm talking UK retailers, but the same is happening to British brands in other parts of the world: Topshop has gone kaput in Australia, for example.

Topshop, of all places... HOW?!

Why is this happening so frequently?

I think it started in the UK a few years back when Woolworths closed its doors in 2008. How could Woolies, stalwart of the high street, go out of business? I used to buy my records there as a kid and can remember them selling CDs for the first time. I bought my pick n' mix sweets there on the way home from school so I could eat them before I got home. Even when we bought our house in 2004 I went to Woolies and bought a few household bits and bobs we were missing. Thinking back even earlier, C&A (remember them?!) closed all its UK stores at the turn of the century. Sad times.

In the (recession) years that followed, other big high street stores closed their doors one by one: BHS, MFI, HMV... Most of them had been around forever too.

It's as if the recession dealt the high street fashion industry an almighty blow, dishing out punishment left, right and centre. What's really worrying is that no brand seems to be safe: Every year we hear of Marks & Spencer's woes, and that's despite me and many of my peers agreeing that M&S has some almighty pieces every season (like my super-popular floral tunic dress). Admittedly, it has a lot of drudge as well, so who knows what the answer is.

I'm worried that it's the fast fashion brands that are taking over the high street, leaving quality and expert craftsmanship in the dust. Primark bought most of the C&A stores when they closed, which says a lot. Don't get me wrong, I do mostly buy high street clothes at the cheaper end of the spectrum (Asos, La Redoute, Zara and River Island being some of my favourites), but I favour the higher-end brands such as Jaeger and Reiss when I'm a little more flush.

I have no answers myself - when I got the news about Jaeger I was absolutely STUMPED as to why this was happening. Did they alienate their core customer base by modernising? Maybe, but other brands have enjoyed renewed success by doing exactly that. A couple of years ago on the blog I wondered why is there so much negativity towards brands that target the older woman, despite her generally having more disposable income that her daughters.

That could have been a contributing factor where Jaeger was concerned, but they were using a lot of younger bloggers and influencers in their campaigns last year, so it goes against the grain a little.

So as I mentioned no brand seems to be immune to a sudden collapse. With all the recent talk about how digital influencers are generating millions in revenue for brands you'd think (the fashion) business would be booming... but it's not.

I'm just keeping my fingers crossed that no more will meet the same fate.

But the way 2017 has gone so far, I'm not sure that's going to happen...

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Why Are So Many Fashion Brands Going Into Liquidation? Jaeger, Karen Millen, Ted & Muffy, Ben Sherman...

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34 comments

  1. I was chatting to a sales assistant in Jaeger last week and he said that the company's been bought by Edinburgh Woollen Mill. Really odd choice, EWM is not reknowned for its quality (wool is misleading, many of their jumpers are acrylic!), whereas Jaeger uses some of the same Italian factories that designers do and generally has a high standard. I love Jaeger, if the quality goes down then I'll be gutted!! In the vintagey world too, brands have closed down - Tara Starlet was a London based business, all UK made with unique designs. Whereas Lindybop (cheap and cheerful) seems to be going from strength to strength. Such a shame. x

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    1. Hmm I also read that about EWM, but that they'd bought the brand (name) only and not the company and now there's a legal wrangle or something... we shall see. I too hope that if they do continue then the quality doesn't go downhill 😔

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  2. I didn't realise Karen Millen was going out of business. It makes me so sad, imagine all those staff out of work!
    Kathryn /Cherries in the Snow

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  3. Shocked about American Apparel.. Only around 5 or so years ago I swear it was THE shop.

    xo Millie
    www.modishrambling.com

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    1. It was, wasn't it Millie?! Maybe being "American" by name doesn't translate to a UK market...?

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  4. I agree with you Catherine, it is worrying that the fast fashion stores seem to be thriving whilst these great British brands of quality are biting the dust. It says a lot about us, the consumer. Much of which I'd rather not contemplate too deeply. The bigger picture is far too frightening.
    More thought provoking articles from you woman, good work!
    xxx

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    1. Thanks MT - I just couldn't believe it when I heard about Karen millen, you just think Not ANOTHER one...?! I hope to god the fast fashion stores don't take over the high street completely, it doesn't bear thinking about 😣

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  5. I'm not talking specifically about Jaeger or any of the others but, generally speaking, I think the problem is all about customers feeling like they are unimportant to the brands.
    Brands need to gain the trust of the people who favour quality, then actually deliver that quality!!
    I really object to paying £40 for a t-shirt that is from the same factory as one from another shop for £4.
    Brands need to stop treating their customers like mugs, and give us credit for having some savvy.
    We don't mind paying extra if we are getting extra.
    Brands cutting corners to boost profits just doesn't wash with us.
    Customers deserve the attention and special treatment, not just shareholders.
    We are the ones with the money and ultimately the power to keep the brands in business.
    Brands also need to move with the times and provide something different that we are crying out for.
    Everyone wants to look chic, stylish and "expensive" without being ripped off.
    The market is so enormous now that brands need to constantly evolve or sink to the bottom.
    A great post Catherine that really made me think more about this issue.
    Thank you!
    XXX
    Samantha
    Fake Fabulous | Style and Fashion, over 40

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    1. You're quite right about the customer being second to the shareholders, Samantha... To be honest, *how* the ones that get it right get it right I really don't know. THanks so much for your (as always incredibly interesting) thoughts!!

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  6. The same thing is happening in the U.S. It could be the result of 80% of the female population wearing nothing but yoga clothes. Everyone is so casual, there seems to be no need for "real" clothing at all. It is very unfortunate.

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    1. I always think back to the 50s and 60s LOri, when women were incredibly well turned out even just to pop to the shops...!! Hats and gloves always! But yes, you may be onto something with that theory...

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  7. Yes it's a shame. Here in the Netherlands a lot of great brands are taken over and then they completely change their style to very basic, boring clothing.

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    1. I wonder if that's the Scandi influence, Nancy? x

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  8. Jaeger was indeed a massive shock, I found out when I went to return part of an online order from there and couldn't use Collect+ as they had just that day gone into administration! And now Karen Millen, crikey... They are an iconic brand.. I wonder how much the shift to online has to do with this, particularly in Karen Millen's case, which has so many high street stores? Every time I have walked past one in the last year or two, it has seemed devoid of customers. Yet they are highly coveted second hand on eBay! It is increasingly easy to buy higher end at lower prices these days through eBay et al,mod you think that has an effect? I don't understand the economics of it, but I can see how the bricks-and-mortar presence would be unsustainable at least.. And perhaps the high end high street suffers from its position between cheap fast fashion stores at one extreme and, moving up the ladder a little, designer diffusion ranges? I really don't know but it does not augur well...

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    1. Yes to everyone buying online Rozanne (I'll hold my hand up to that one, I rarely - if ever - hop in store anymore) and yes to buying things cheaper on eBay. Jaeger and Karen Millen are definitely in that dangerous area, I just hope that Reiss aren't next as I LOVE Reiss too...!!

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  9. Interesting question! There have been so many brands - maybe just not enough buying power for all the brands out there? Firstly, sorry to anyone who loved Jaeger and is now without their go to store; it wasn't a favourite of mine but I can imagine how gutted I'd be if one of my favourites did go.

    However, why wasn't it a favourite? I'm probably on the edge of target market for them.. Basically for the price they were asking they didn't deliver something unique or special enough as far as I was concerned. If I was spending that sort of money I would probably opt for the individuality that someone like Toast could provide. Or even go for Cos and have a few items rather than one piece from Jaeger. It never felt like a luxury brand to me but it did cost alot of money and for me it didn't deliver enough fashion punch.

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    1. Thanks hon - though I have to disagree with you on the uniqueness of Jaeger (but of course this is purely my subjective POV) - the reason I loved them was because they WERE unique and incredibly modern. Just enough of a nod to current trends, but not too "out there". I found the quality to be exquisite and worth every penny... I have a long pinstripe wool coat that is going to last me years. Unfortunately Toast doesn't do it for me, I find it all very shapeless and drab - again, just what I think!!

      But it goes to show that us all having differing opinions meant that perhaps most women will have thought like you, in which case no wonder they went down...!!

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  10. I am shocked! Karen Millen of all brands! I knew about Jaeger, part of uk fashion history going down. I thought that was bad enough. I also knew about Jacques vert. Another shock. But when women can buy the throwaway trends in these cheaper stores they will. It's just as cool nowadays to score the new Primark must have that's sold out as to buying a top show off label. I think this is where it's gone wrong. I dissagree with some comments about quality.I think you get what you pay for with a lot of these higher end brands. Some of my more expensive items are still being worn twenty years down the line unlike my cheaper on trend items. And one of my oldest items is Jacques Vert!
    www.vanityandmestyle.com

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  11. The most significant factor is the universal decline of the middle class. We have a shrinking pool of people with disposable income. Young people are less financially secure than their parents were at the same age, the middle aged are worried (with good reason!) about their retirement and often have to support older children, and the elderly are feeling the pinch as we live longer than ever before. As a large population of people face greater economic stress, spending habits change.

    True prestige brands like Gucci, Chanel, etc. aren't in danger because the wealthiest are still their clientele and the rest will still aspire / save up to own certain pieces. Fast-fashion brands like ASOS, Zara, Mango can succeed by offering "the look for less." But mid-range brands like Karen Miller suffer because their would-be bread-and-butter clients are most likely more financially strapped than they were two decades ago.

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  12. I find it very sad that many of the mid level brands are going. Especially Jaeger, I worked for the for many years and agree with you their quality and design was excellent.

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  13. I have to agree with many of the other comments: I think the reasons are largely financial. Initially I was very surprised to hear about Karen Millen, but perhaps on reflection it makes sense. I really like Karen Millen designs, but in all honesty, I think the garments are overpriced. I like to look, but very rarely buy (less than once per year), because I personally just don't feel they are worth the price tag, unless it's something really unique. Karen Millen are also very on-trend, and I'm not willing to pay their prices for something that will be out of style in a few months.

    Jaeger might be a different situation though: I just think there's perhaps less demand for the more tailored look than there once was, now that casual styles have become acceptable in the workplace. And - whether justified or not - I think they do have a reputation for being a bit 'frumpy'.

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  14. Jaeger closed here in Toronto about a year ago and while it was sad I can't say that I was surprised. Like many venerable brands with a loyal client base I think they forgot about those clients and decided to become "young & trendy" and seek out a younger, hipper market. The trouble is, those customers didn't think of Jaegar as a place to shop. A friend and I visited the flagship store before it closed - there wasn't one thing that I could buy as I wear a 16 - my fiend who wears an 8/10 was hard pressed to find anything of quality that was worth the price being asked. The sales staff were all under 25 and teeny tiny - they seemed genuinely puzzled that two middle aged women would even enter the store.
    So many mid-range brands seem to want to become high end retailers - they forget that there is only so much money to go around. They also forget that in many countries the population is aging, women over a certain age don't normally wear a size 2 - which means many, many potential customers are lost right from the start.
    They have gotten caught up in the hype at the wrong time - money can be tight, the middle-class is shrinking, populations are aging - I don't want junk but neither can I afford $100 for a t-shirt - there seems to be very little middle ground left.

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  15. It's really sad that so many brands that we've grown up with are no longer a part of our lives. I remember going to Woolies for pick'n'mix sweets too. It was one my favourite shops as a kid! C&A too - but at least we've got them here in Portugal now. I occasionally buy the odd piece from there.
    Suzy xx
    www.suzyturner.com

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  16. Well, consolidation among corporates may be a contributing factor - the big outfits (heh) buying up the little guys and being able to cut better production deals that price out the smaller operators. Shareholders, unable to get returns from interest in banks, have turned to stockholdings and scream for dividends every year, as they always have done. Then it's cut, cut, cut to get a good bottom line. Cutthroat!! In the end, will we end up with only two mammoth global retailers?!! Please say that's not so.

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  17. How did I miss Karen Millen going? That was always my go to for wedding outfits. I think the high street has become saturated and people overwhelmed with choice. At the same time there are so many exciting new brands coming out too. Yvadney x #BrillBlogPost

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  18. I'm a huge Jaeger fan and I would say 50% of my wardrobe is from the company after my Mother in Law introduced me to the brand a few years ago as I couldn't find suitable or quality clothes to fit my size 16 body shape and promptly fell in love with the brand as I was a size 16 in everything...no second guessing my size so I became a loyal customer.
    The past few seasons I have noticed they have really changed their tune in their designs and became more trendy which made me buy less as the clothes were designed for a much younger age range and didn't fit my body shape and more importantly my lifestyle.
    Jaeger and M&S have gone down the route of trying to attract the younger generation into their shops however what they have done is actually alienated their much older loyal customers in the process. The younger customers aren't loyal to brands - they are more after fast fashion and staying on trend and we are seeing brands fail due to this now...they've really backed the wrong horse.
    Not sure what has changed however the past 5-10 years, fashion has become so disposable and very cheap. My question is - how long should a piece of clothing last for these days and why is disposable fashion so popular? Quality over Quantity is more important and it means you do spend less and it's better for the environment.
    Fingers crossed that Jaeger pulls through but I'm not hopeful!

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  19. I'll admit to mostly using Fast fashion, but then my budget isn't great (hence a lot of second hand) but for most of my friends (mid 30s) a lot of stores like Karen Millen were not on our radar, they had nice stuff but not at a price we can justify.

    Sadie
    Aim For Fabulous

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  20. Perhaps brands and consumers are all learning of the consequences of our actions. I agree about quality brands having to deliver on quality items - Banana Republic, for example, used to make fantastic T-shirts at a reasonable price but they no longer make them despite the fact that their customers (including me) still want to buy them. Instead, their shirts have taken on the reduced quality of their lower end brand, Old Navy, but not the price. As a result, while I go in to Banana Republic, I hardly ever buy anything there any more. The quality and the price just don't line up. And fast fashion (I mean, really, disposable junk for short-term wear) certainly has a place, but it seems to be taking over the entire wardrobe for a lot of people. I would like to see more transparency in where things are made and how people are treated, so I can make decisions about where I want to spend my money. As consumers, we have a lot of power. I must admit, I do make purchases on-line, but I also enjoy going shopping - hopefully, shopping will continue to be an experience we can all enjoy on the high street and in department stores........................

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  21. What? Not Karen Millen? That's such a shame. I think it's sad to see so many retailers close their doors. I wasn't aware Jaeger was going either, I thought just the Truro store was closing. Austin Reed went a little while ago down here too. I've generally thought the internet is killing the High Street for a long time, yet the irony is (in Cornwall), we aren't spoilt for choice. We have some excellent retailers, chain and independent, and I don't want to see any of them go whether I frequent them or not.
    Is Banana Republic going altogether too, or just in the UK?
    I think I agree with the statements above: it's the middle that get squeezed: shops or people. Sad, but true.

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  22. Though it's sad when businesses fail, I do hope it is because of a rise in people reusing/recycling clothes and being more environmentally friendly when it comes to fashion #brillblogposts

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  23. OMG I'm just reading this now, whaaaat?! Karen Millen makes the only tailored dresses that fit me well. Mango occasionally has some nice stuff but not as often and as many as I'd find at Karen Millen. This makes me very sad. I too shop at Zara and River Island for staple items mainly, but Jaeger and Karen Millen were definitely where I liked buying statement pieces. Bags, dresses, shoes coats. Some lasted me many many years and in better condition than cheap items from lower end high street shops. But as Lylia Rose said, hopefully something good will come of this.

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  24. I am not in the UK but my comments are that retailers are in constant sale, fast fashion has infiltrated the middle market who try to keep up with constant drops of new styles, quality is declining in some areas but customers will not pay for quality, retailers are stuck on making styles for the office working 22-25 year old who is a size 10 and who goes out to parties and festivals. People expect so much choice now too - and can buy online from the US (or the UK) and bypass the high street retailer. The quantity of clothing we own is growing - but in general while we are fashionable we are often less stylish. And yes, athleisure is a huge trend, taking money off other fashion retailers. There is no easy answer. The truth is we cannot buy the quantity of clothes at full/medium prices. There are examples of retailers who are adapting and thriving here in NZ....and we have a few chains I suspect are struggling.

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  25. This is so sad to hear. Karen Millen and Jaeger! What the?! I'm so surprised to hear this as I had no idea. What a shame for our high streets.

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