From the Sector

On the occasion of Global Fashion Summit: Boston Edition 2023, Global Fashion Agenda (GFA) has released the 2023 edition of the Fashion CEO Agenda  — a concise report to support the establishment and implementation of leadership strategies to achieve a net positive fashion sector that puts back more into society, the environment, and the global economy than it takes out. In a first for the Fashion CEO Agenda, this edition has been developed to include subsequent action areas for brands, retailers, and producers.  

With less than seven years to deliver on the UN’s Sustainable Development Goals, fashion industry leaders, together with the broader sector, must take urgent steps to make sustainability an integral part of their business strategies. Developed for executives of fashion brands, retailers, and producers, the Fashion CEO Agenda is a succinct resource to support executives in accelerating tangible action across five socio-environmental sustainability priorities:  

• Respectful and Secure Work Environment
• Better Wage Systems
• Resource Stewardship
• Smart Material Choices
• Circular Systems

The 2023 edition includes action areas that have been established through several years of stakeholder engagement and reinforced through the  global Fashion Industry Target Consultation, led by GFA in partnership with the United Nations Environment Programme (UNEP). The organisations consulted several hundred industry stakeholders through numerous regional workshops and surveys translated into several languages to help inform a holistic framework that captures global perspectives on social and environmental sustainability.  

Action areas outlined in the report include promoting worker access to effective grievance mechanisms, promoting fair compensation and living wages, establishing water stewardship, and addressing overproduction.

Moreover, the report reiterates the need to adopt existing industry-aligned targets, including UNFCCC’s time-bound targets on decarbonisation and the uptake of preferred and low climate impact materials. The material actions outlined are based on consensus across industry stakeholders and topical experts. Extensive stakeholder engagement demonstrated that substantial action is still urgently needed from all actors in the value chain, while such action must be informed by local contexts.

To complement the Fashion CEO Agenda, GFA has created a 2030 Fashion Sector Vision, which presents where the overall sector should be in relation to each of the five sustainability priority areas within only seven years - a critical milestone on the road to net positive by 2050. The objective is to unite the broader sector, consisting of industry actors such as brands, retailers, and producers and other key stakeholders including consumers, citizens, NGOs, innovators, policymakers, and investors. To realise this Vision, it is imperative that the sector moves from ambition to action – the theme underpinning Global Fashion Summit: Boston Edition 2023. GFA now calls on fashion leaders to align their corporate strategies to the priorities and actions laid out in the Fashion CEO Agenda and for the wider sector to support in fostering a conducive environment for scaling this transformation.

Textil Santanderina, a manufacturer of quality fabrics with controlled traceability, launched its Advanced Black denim collection in collaboration with Archroma.

The Advanced Black collection by Textil Santanderina uses Archroma’s new DIRESUL® EVOLUTION BLACK LIQ dyestuff to produce on-trend authentic black denim apparel with sustainability and resource savings. In addition to allowing fashion and apparel brands to choose eco-friendlier alternatives that demonstrate their commitment to protecting people and planet, Textil Santanderina’s new Advanced Black denim range also offers unique shade and wash-down effects.

Based on synthesis technology developed by Archroma, DIRESUL EVOLUTION BLACK LIQ delivers an overall impact reduction to 57%*, measuring its effect on human health, ecosystems and resources compared to standard Sulfur Black 1 liquid. Unlike traditional synthesis processes, it does not produce any ammonia, sodium salts waste or liquid effluents, and water consumption in the synthesis process is reduced by 73% for massive savings. The new DIRESUL dyestuff, when adopted with the full Archroma coloration system, delivers a new black color with on-tone wash-down effect and cleaner effluent at the mill.

Textil Santanderina and Archroma previously collaborated to produce Textil Santanderina’s aniline-free** indigo denim collection with the use of DENISOL® PURE INDIGO.

*As determined by Ecoterrae, a leading Spain-based sustainability consulting firm, through a Life Cycle Analysis (UNE-EN ISO 14044:2006) at the synthesis stage, using the ReCiPe 2016 Impact calculation methodology.
**Below limits of detection according to industry standard test methods.

With over 400 exhibitors, the fourth Istanbul Fashion Connection event from August 9-11, 2023, at the Istanbul Expo Center on 35,000 sqm was again successful.

With over 20,000 visitors from more than 125 countries, IFCO recorded an increase in visitors of over 30% compared to August last year. International visitors more than doubled, with the largest visitor groups coming from Asia and the Middle East at 33% each, Europe at 17%, Africa 11% and the Americas at 6%.

All retail channels were represented at the show, from large shopping mall and department store groups to wholesalers, international retail chains, multi-brand boutiques and online platforms.

Exhibitors
In six clearly segmented halls, more than 400 brands presented themselves on 35,000 sqm from womenswear, menswear, kidswear sportswear, denim, leather and fur.

The Core Istanbul
For the second time, the exclusive design area The Core Istanbul, originally launched as part of Istanbul Fashion Week, presented itself at IFCO. Among others, Arzu Kaprol, Ceren Ocak, Çiğdem Akın, Essin Barış, Ezgi Karayel, Fulyaİlkmen - F.ILKK, Mehmet Emiroğlu, Meltem Özbek, Mert Erkan, Merve Ulu - Kuela, Murat Aytulum, Nejla Güvenç - Nej, Özlem Erkan, Selin Küçüksöz, Tuba Ergin joined the show. Menswear was also represented with Emre Erdemoğlu, Seydullah Yılmaz - SYHZ Wear and Yakup Biçer - Y Plus.

The Exclusive Area
Leading Turkish retail brands, already internationally active, showed in The Exclusive Area such as B&G Store, Climber BC, Damat, Giovane Gentile, Hatemoğlu, Ipekyol, Kayra, Kiğılı, Lee Cooper, Lufian, Jakamen, Naramaxx and convinced with their high quality, sustainable and fashionable products, which were in great demand among international buyers. Jakamen opened the IFCO Shows on the first day of the fair with its latest spring / summer collection for 2024.

FashionIst
With its own catwalk, the occasion fashion section FashionIst for women and men featured thirty leading brands and showed a cross-section of the latest designs in evening fashion with their innovative colors and dynamic styles. Daily fashion shows informed visitors about the latest trends.

B2B Match Making
The B2B Match Making at IFCO took place in speed dating mode and was well received. Exhibitors were efficiently networked with buyers from all over the world such as Inditex from Spain, Walmart, Quicksilver, Teddy Fresh or Wilbo from the USA, Sainsbury's from the UK, Cihuah from Mexico, the Apparel Group and Safari Group from the United Arab Emirates, Ria Miranda from Indonesia, Hi Style and Zalora from Malaysia, Musinsa from South Korea, Ackermans from South Africa etc.

IFCO February 2024
For the next date of IFCO (7.-10. February, 2024), the organizers expect more than 600 companies. The participation of international fashion companies is to be expanded, for which IFCO provides the ideal springboard into the European and Asian markets.

• Currency-neutral revenues flat versus the prior-year level
• Top-line development reflects improved sell-out trends and conservative sell-in strategy
• Gross margin up 0.6pp to 50.9%; strong improvement compared to Q1 reflecting better sell-through and less discounting
• Operating profit of € 176 million includes extraordinary expenses of around € 160 million related to one-off costs, donations and accruals for future donations
• Inventory position improves substantially versus Q1 level to € 5.5 billion; now up only 1% year-over-year

In the second quarter of 2023, currency-neutral revenues were flat versus the prior-year level. The top-line development continued to be impacted by the company’s conservative sell-in approach in order to reduce high inventory levels, particularly in North America and Greater China. At the same time, adidas second quarter revenues benefited from the first sale of some of its Yeezy inventory. The initial product drop in June generated revenues of around € 400 million in Q2, which is largely in line with the Yeezy sales generated in the prior year’s quarter.

Footwear revenues grew 1% during the quarter, reflecting strong growth in football, basketball, tennis and US sports. Apparel sales declined 3% in the second quarter. As the apparel market continues to be particularly overstocked, the company continued its conservative sell-in strategy to improve sell-through and margins in the medium term. Accessories grew 8% during the quarter driven by growth in football.  

Lifestyle revenues were down during the quarter despite extraordinary demand for the company’s Samba, Gazelle and Campus franchises. While adidas slowly started to scale its offering for these product families during the second quarter, the total volume still only represents a small portion of the company’s overall business. Sales in the adidas Performance categories continued to show positive momentum. This reflects strong demand for new product introductions such as the latest iterations of its Predator, X and Copa football boots, as well as jerseys for both the FIFA Women’s World Cup 2023 and the company’s unique portfolio of football teams ahead of the start of the European club season. In addition, the Adizero product family in running continued to gain a lot of attention around marathon races across the world, translating into higher demand. At the same time, the brand’s Barricade tennis franchise grew strongly, leveraging the excitement around major tournaments.

In euro terms, the company’s revenues declined 5% to € 5.343 billion in the second quarter (2022: € 5.596 billion).

Stronger sell-out trends and conservative sell-in
As a result of the company’s initiatives to reduce high inventory levels, currency-neutral sales in wholesale declined 10% despite double-digit growth in Greater China and Latin America. At the same time, direct-to-consumer (DTC) revenues grew 16% versus the prior year. This development was driven by strong growth in both the company’s e-commerce business (+14%) as well as own retail stores (+19%), reflecting continued strong sell-out trends across most regions. The outperformance of the company’s DTC channel versus the wholesale business was also related to the first sale of the Yeezy inventory, which was done exclusively through adidas’ own e-commerce channel.

Double-digit growth in Greater China and Latin America
Currency-neutral sales in North America declined 16% during the quarter. The region is particularly affected by elevated inventory levels in the market and – in response to this – the company’s significantly reduced sell-in. Revenues in Greater China grew 16% in Q2, reflecting double-digit sell-out growth in both wholesale and own retail. Sales in EMEA were down slightly (-1%) despite double-digit DTC growth. While the company’s initiatives to reduce inventory levels and discounting weighed on the overall top-line development in the region, adidas recorded significantly improving full-price trends during the quarter. Revenues in Asia-Pacific increased 7% during the quarter, driven by strong double-digit growth in DTC. Latin America continued to increase at a double-digit rate (+30%), reflecting strong growth in both wholesale and DTC.

Gross margin improves to 50.9%
The company’s second quarter gross margin increased 0.6 percentage points to 50.9% (2022: 50.3%). This improvement was mainly driven by price increases the company has implemented as well as by an improved channel mix. At the same time, higher supply chain costs and unfavorable currency movements continued to strongly weigh on the gross margin development. While still adversely impacting the company’s gross margin in the quarter, discounting levels significantly improved compared to the first quarter of the year.  

Operating profit of € 176 million, resulting in an operating margin of 3.3%
Other operating expenses were up 3% to € 2.582 billion (2022: € 2.501 billion). As a percentage of sales, other operating expenses increased 3.6 percentage points to 48.3% (2022: 44.7%). Marketing and point-of-sale expenses decreased 7% to € 617 million (2022: € 663 million). As a percentage of sales, marketing and point-of-sale expenses slightly decreased by 0.3 percentage points to 11.5% (2022: 11.8%). Operating overhead expenses were up 7% to € 1.965 billion (2022: € 1.838 billion), reflecting higher logistics expenses. In addition, the company recorded one-off costs of around € 50 million related to the strategic review the company is currently conducting as well as donations and accruals for further donations in an amount of around € 110 million. As a percentage of sales, operating overhead expenses increased 3.9 percentage points to 36.8% (2022: 32.8%). The company’s operating profit amounted to € 176 million (2022: € 392 million) in the quarter. This amount includes the extraordinary expenses of in total around € 160 million reflecting the one-off costs related to the strategic review as well as the donations and accruals for further donations. The sale of the Yeezy product positively impacted adidas’ operating profit by an incremental amount of around € 150 million in Q2. The operating margin reached 3.3% in the quarter (2022: 7.0%).

Net income from continuing operations of € 96 million
After taxes, the company’s net income from continuing operations amounted to € 96 million (2022: € 360 million), while basic EPS from continuing operations decreased to € 0.48 (2022: € 1.88).

Outlook

adidas expects revenues to decline at a mid-single-digit rate
On July 24, adidas had adjusted its full year financial guidance to reflect the positive impact of the first sale of some of its Yeezy inventory and a slightly better-than-expected development of the adidas business in the first half of the year. At the same time, macroeconomic challenges and geopolitical tensions persist. Elevated recession risks in North America and Europe as well as uncertainty around the recovery in Greater China continue to exist. In addition, the company’s revenue development will continue to be impacted by the initiatives to significantly reduce high inventory levels. As a result, adidas now expects currency-neutral revenues to decline at a mid-single-digit rate in 2023 (previously: decline at a high-single-digit rate).

Underlying operating profit anticipated to be around the break-even level
The company’s underlying operating profit – excluding any one-offs related to Yeezy and the ongoing strategic review – is still anticipated to be around the break-even level. Including the positive impact from the first Yeezy drop of around € 150 million, the potential write-off of the remaining Yeezy inventory of now € 400 million (previously: € 500 million) and one-off costs related to the strategic review of up to € 200 million (unchanged), the company now expects to report an operating loss of € 450 million in 2023 (previously: loss of € 700 million).

On August 2, the company launched a second drop of Yeezy inventory. Throughout the month of August, adidas is making a range of existing products available through both its own e-commerce channel as well as the digital platforms of selected wholesale partners. If successful, this second drop would further improve the company’s results. However, as the results of this drop are yet unknown, it is not accounted for in the company’s current top- and bottom-line outlook for 2023.

PrimaLoft, Inc., a leader in advanced material technology, is expanding its  Active Insulation Range by adding four new Active Evolve styles, reaffirming its commitment to providing cutting-edge solutions that meet the evolving needs of consumers.

Originally launched in 2018, PrimaLoft Active Evolve is a line of insulating fabrics that is designed to evolve performance, design, and sustainability. Combining the lightweight warmth of insulation with the breathability of fabric, this technology is developed to perform in a wide range of activities, regardless of intensity or season. From pushing yourself during a cross country ski tour, to working up a sweat hiking to the next peak, PrimaLoft Active Evolve keeps you in your comfort zone – even when you’re pushing yourself out of it.

Several products in the Active Evolve line can be used as a next-to-skin fabric. This enables brands to forego liner fabrics, which means heat and moisture are more efficiently managed, breathability is supported, and user comfort is maintained. In addition to achieving optimal performance during aerobic activity, this yields a wider utility and year-round use, all while allowing brands to use less overall material when designing a garment, reducing footprint and waste.

PrimaLoft Active Evolve offers several advantages to designers. It enables them to utilize the full spectrum of color, incorporate unique patterns, and provides greater flexibility in fabric selection. Additionally, Active Evolve eliminates the need for quilting in the design process. Products within the Active Evolve line are made from up to 100% post-consumer recycled content, including three of the four new styles.

With more than a dozen brand adoptions thus far, PrimaLoft Active Evolve’s adaptability for the user, range of use across activities, and seasonal timing, is quickly making this one of the most versatile products in the PrimaLoft portfolio. For Fall/Winter 2023-2024, key partner brands beside Sitka and Löffler will include CP Company, Eddie Bauer, Endura, Martini Sportswear, OMM, Quiksilver, Ziener and more.

From 2 to 4 September 2023, twenty Chinese fashion brands will present themselves for the first time on an international platform under the umbrella of CHIC, China International Fashion Fair. On 900 sqm CHIC presents the FASHION CHINA pavilion at Who's Next with a selection of Chinese womenswear, menswear, sportswear, and hats.

Womenswear is represented by Ellassay, Laurèl (founded in Munich, Germany), JNBY, LUO ZHENG, RAXXY (women and men), KEYONE (hats for women, men, kids, no gender), Thread & Story, MAY D.WANG Cashmere & Silk, Yvonne CHOI, SE JIE, VAN SUNSUN, SELAH, EXTENDED, ARYA CASH, JORE BAUDRY, CANMADE and HEMPEL International.
Menswear is represented by KB Hong by K-BOXING and JOEONE. Exclusive sportswear will be shown by FENGGY.

FASHION CHINA is planned as a prelude to the presentation on further international platforms and is to complete CHIC's offer as a service point for Chinese fashion brands in the future.

Around 500 exhibitors with international participation from Europe and Asia are expected at the next CHIC in Shanghai from 28 to 30 August. CHIC - China International Fashion Fair is organised by China National Garment Association in cooperation with China World Trade Center Co. Ltd.

adidas unveils its new campaign to celebrate the FIFA Women’s World Cup Australia & New Zealand 2023™. The campaign is dedicated to next gen icons Alessia Russo, Lena Oberdorf and Mary Fowler and looks to drive more global attention for the game and inspire other young women and girls to follow in their footsteps.

Marking adidas’ most impactful Women’s World Cup campaign to date, the brand unites its global family of football legends and advocates of the women’s game. Headlined by a series of fast-paced films, the campaign welcomes a star-studded line up of David Beckham, Leon Goretzka and Ian Wright, actor and football fan, Jenna Ortega, as well as Argentina’s World Cup hero, Lionel Messi. They come together to celebrate the skills that Russo, Oberdorf and Fowler are renowned for, from vision and interception to power, creativity and accuracy.

The films are part of a new creative proposition from adidas for the upcoming tournament. ‘Play Until They Can’t Look Away’ aims to platform and showcase some of the world’s greatest football players on the biggest stage – whose skills and passion for the game demand global attention and support.

Set against the soundtrack of SL2’s iconic song, On a Ragga Tip, fans see World Cup winner, Lionel Messi, alongside Mary Fowler, guiding both viewers and Jenna Ortega across the world to Fowler’s home country of Australia , with preparations for the biggest women's sporting moment underway.

Meanwhile, David Beckham and Ian Wright, alongside his granddaughter, Women’s Arsenal FC player, Raphaella Wright-Phillips, are unable to look away in a supermarket as Russo spectacularly weaves her way through the narrow aisles, in her own creative fashion. Finally, Goretzka is expertly interrupted while bowling as Oberdorf whizzes around an arcade, powerfully intercepting balls in each scene to achieve a high score of her own.

Paying respect to those who have gone before, the films are also filled with subtle references to memorable moments that football super fans will revel in, including shirt numbers, iconic tournament balls, plus much more.

Archroma is bringing the entire portfolio of 5,760 Archroma Color Atlas colors to swatchbook, a platform for material digitalization and sourcing.

The new partnership provides fashion, apparel and textile designers and manufacturers with an elevated standard for color accuracy that meets the needs of today’s increasingly technology-driven and integrated supply chain. This will help the textile and fashion community to improve sustainability, whilst lowering costs and shortening turnaround times.

The Color Atlas by Archroma® was launched in 2016 to provide fashion designers and stylists with off-the-shelf color inspiration that can be implemented in production with just a few clicks.

Designers will use the 5,760 Archroma Color Atlas colors on swatchbook to rapidly develop accurate digital colorways and visualize their final product. They can then share these digital swatches with their manufacturing partners, providing access to the swatchbook metadata, which can include information such as the materials’ composition, weight and color.

This will streamline the overall design and production process for color-critical fashion and textile products, allowing for faster turnaround. Digital materials supported by trusted coloration technology also reduce the need for samples and eliminate physical swatchbooks, bringing environmental benefits and lower costs to brands and suppliers.

All 5,760 Color Atlas by Archroma® colors are now available free of charge to subscribers on the swatchbook platform.

This season, adidas Originals and the progressive Ukrainian label KSENIASCHNAIDER have come together to present a collaborative collection featuring a host of unconventional garments, footwear, and accessories.

Founded in 2011 by Ksenia and Anton Schnaider, KSENIASCHNAIDER is a Kyiv-based independent fashion house centered on creating boundary pushing ready-to-wear, denim, and upcycled apparel and accessories. Drawing on Ksenia’s design language and Anton’s engineering logic, the partners’ eponymous label continues to challenge established conventions to boldly project a new vision of the future.

The collection is anchored by a host of garments which blend the Ukrainian house’s signature aesthetic with adidas’ instantly recognizable brand codes. First, an array of denim pieces – including jeans, jackets, and shirt dresses – are elevated with frayed edges, voluminous cuts, and idiosyncratic details. Second, fresh takes on a timeless adidas classic stand out as adiColor tracksuits, corsets, and dresses are reworked in a patchwork finish.

The adidas Originals x KSENIASCHNAIDER collection launches on July 1st.

With combined regional, global, and industry specific expertise, the Vietnam International Trade Fair for Apparel, Textiles and Textile Technologies (VIATT) will make its debut from 28 February – 1 March 2024. Following the signing of a memorandum of understanding (MOU) in late March, Messe Frankfurt (HK) Ltd and the Vietnam Trade Promotion Agency (VIETRADE) announced the new international fair for the entire textile value chain. The three-day platform will be staged at the Saigon Exhibition and Convention Center (SECC), Ho Chi Minh City.

Commenting on the new event, Ms Wendy Wen, Managing Director of Messe Frankfurt (HK) Ltd, said: “With Intertextile Apparel in Shanghai a prime example, our Texpertise Network provides the ideal global framework from which to launch this diverse, comprehensive platform for the integrated textile supply chain. VIATT itself will capture the essence of Texpertise in one platform – a diverse, one-stop sourcing event for buyers across all categories, from garments, fabrics, yarns and fibres, to textile machinery, technical textiles and nonwovens, and everything in between.”

Discussing the event’s potential, Mr Le Hoang Tai, Deputy Director General of the Vietnam Trade Promotion Agency (VIETRADE), said: “Vietnam is one of the world’s leading textile producers and exporters, and going from strength to strength as one of Southeast Asia’s manufacturing hubs. Our establishment has many years of experience organising trade fairs throughout Vietnam, and together with Messe Frankfurt we are excited to help international fairgoers unlock the potential of the country’s fast-growing textile market. In addition, Ho Chi Minh City’s accessibility, and Vietnam’s proximity to other leading textile-producing nations such as Bangladesh, Cambodia, China and India, make it the logical venue to host an event of this nature.”

Many international textile manufacturers have been expanding operations into Vietnam, augmenting an already strong domestic industry. According to the Vietnam Textile and Apparel Association (VITAS), the country’s textile and garment industry achieved staggering annual growth of 20 – 26% from 2018 – 2022. Participation in international trade agreements such as the Regional Comprehensive Economic Partnership (RCEP), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the EU–Vietnam Free Trade Agreement (EVFTA), and the Indo-Pacific Economic Framework for Prosperity (IPEF)[2], bodes well for future growth.

As one of the world’s biggest importers of textile machinery, and a consistent importer of fabrics, yarns and fibres, garment production is the cornerstone of Vietnam’s industry. The country utilises cotton and functional materials to produce casualwear, childrenswear, swimwear, workwear, and much more, with sportswear an especially fast-growing category, and high-utility garments expected to achieve high exports.

By linking textile players from across Asia, Europe and beyond with this market, VIATT 2024 is willing to play an important part in shaping the future of Vietnam’s industry. Next year’s fair will host an extensive mix of international and domestic exhibitors covering multiple textile sub-sectors, including garments, apparel fabrics and accessories, yarns and fibres, digital printing, home textiles, technical textiles and nonwovens, textile processing, textile machinery, and more.

Exhibitors and buyers can utilise the fair’s global business matchmaking service, where connections are made based on the specific needs of each party. In addition to the fair’s main function as an international trading platform, its fringe programme will facilitate participants’ networking with industry leaders and offer diverse market insights via various seminars, forums, and panel discussions.

The Vietnam International Trade Fair for Apparel, Textiles and Textile Technologies (VIATT) is organised by Messe Frankfurt (HK) Ltd and the Vietnam Trade Promotion Agency (VIETRADE). Covering the entire textile industry value chain, the inaugural edition will be held from 28 February – 1 March 2024 at the Saigon Exhibition and Convention Center (SECC), Ho Chi Minh City.