Freakonomics of Fashion

— The unsustainable economics for new designers

A few years ago, we started a company to design and create shoes. We had a slightly naive perspective that if we simply made a great quality product, we would find customers and slowly start building our brand. We are content with being a small brand, with no major intention to expand or optimise how we monetise the brand. We simply wanted to do authentic, personal designs that would be well crafted by true artisan shoemakers in Italy.

At first, it was a minor frustration with the hurdles we had to overcome. Production proved to be challenging. Sampling, of shoes, is expensive. Attending shoe/fashion exhibitions is very expensive. A few people in the industry gave us encouragement and support, which proved to be incredibly helpful. Nevertheless, mostly, it was a matter of trial and error, exploring how to reach media and buyers. At this point, you face the challenge that you need PR to get access to media, or else you are effectively irrelevant. PR comes at a price, far beyond what a typical small designer can afford. Despite this, their approach often felt obsolete — Produce several samples upfront, place it in their showroom, hope that stylist will visit and use the shoes for photoshoots, primarily for the big print magazines. You would imagine by now they would be more proactive building your online brand profile, and given the price, they charge, more proactive in helping to define and grow your brand profile.

The fashion magazines keep offering us opportunities to pay for advertorials to have our products featured. If we don’t pay them or accidentally happen to become famous overnight, we have little or no value to them. The majority of the fashion press is dominated by large, regular funding from the big luxury brands. Much like the media in general, the fashion press is not driven by journalism — to discover and present stories about new interesting designers, but primarily by advertising money.

We have received great response from some buyers, in particular, a few that were instrumental on our journey. Yet, we realised the problem is bigger. The buyers themselves are struggling. Retail rents, especially in prime locations, can be exorbitant. Also, the concept of building up stock, out of which approximately 70% is unlikely to be sold at full price, is not sustainable. Consequently, buyers are forced to work with high margins that make good quality products out of reach for most people.

Instead, consumers will focus on what they can afford — fast moving, low-cost fashion that brings a range of side effects. Generally, this involves mediocre quality products, which doesn’t last and adds to landfill. More importantly, such products are often produced under bad conditions, taking advantage low labour costs in countries where people struggle for survival. Finally, products are shipped around the world adding to pollution, retail staff are often underpaid and when possible, companies even try to avoid paying taxes.

Ultimately, this leads to a market where small designers and producers really struggle to reach potential customers, despite being able to offer well design products at a reasonable price.

We have decided that we no longer believe in this model. In order to survive as a brand, we want to be able to reach our customers directly so that we can offer a product that is made under somewhat fair conditions, good design and quality craftsmanship, to a price that is well within reach for most people. Therefore, this week we have launched Aksha Fernandez on Kickstarter:

AL

https://www.kickstarter.com/projects/965978292/designer-shoes-for-the-contemporary-woman/

If you share our belief in a fashion industry that is governed by good design and quality craftsmanship, not a slave conservative media and luxury oligopolies, please do support our campaign and let us ignite a better debate about this.

By Lars Rosengren

PS. We want to be clear that this article does not aim to target any individuals or companies. We know that the fashion industry has many well-intended people and companies. That said, the overall economic and political dynamics of the industry are not in healthy for new creativity to thrive. Therefore, we all have reason to rethink how we foster a better creative climate for the future of the fashion industry.

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