Always a draw for customers, the free return policy offered by e-commerce platforms seems to spur a spate of impulsive purchases which eventually are returned. Returns can be costly for the e-retailer. In the US, The National Retail Federation found 18.1 per cent items purchased online in 2020 were returned. In most cases, returns mean the retailer paid for shipping to and from a customer without getting a sale, plus returned merchandise can’t always be resold, and those costs hit their bottom line. However, some retailers disagree as they know that those who purchase the most return the most.

Fee on returns

After years of subsidizing them, more retailers are charging customers to send back unwanted goods. It’s a risky move because shoppers have become accustomed to buying an item in multiple sizes and colors and returning what doesn’t fit for free. Looking back at 2022, return policies of retailers underwent change in the US, one of the largest e-commerce markets in the world. In 2021, the number of large retailers in the US and Europe who introduced a return fee policy were 31 per cent and it rose to 40 per cent in 2022. Brands like Zara, J Crew, Boohoo and Abercrombie & Fitch are on this list. Zara now charges UK customers £1.95. Emboldened by such a large retailer implementing this change, others feel confident of their decision to do away with free returns.

Making business sense

Moving away from subsidizing returns was a thought-through decision for the global e-commerce sector as they spent the past two decades removing costs from supply chains and customer service. Returns had not been looked into, leaving them as one of the few places with lots of room for reducing expenses. They are costly because of the labour to have them shipped back, inspected and put up for resale. Investors are demanding that online businesses focus on increasing profitability rather than focus on growth. Year 2022 seems to be the one when free return policy was heavily weighed.

The pandemic had seen a huge growth in online shopping as people couldn’t access physical stores for health safety issues. This spate of buying also meant a larger than before number of returns. Lockdown disruptions created an inventory glut in categories such as apparel, which is expected to increase discounting and the potential for shoppers to return goods when they see better deals. As Amit Sharma, CEO and Founder of Narvar a post-purchase customer experience platform said in a recent media interaction, consumers experiencing the highest inflation in four decades are more frugal, increasing the chances that they second-guess a purchase and return it. On the other hand, increased costs for transportation, energy and labour have made returns even more expensive, giving e-retailers the raison d’etre for them to change their return policies. The cost of processing returns has eroded margins too much to be able to continue with it according to industry experts.

Indian e-commerce players follow global trends

Myntra, the mega local e-commerce giant has reviewed and renewed its return policy after experiencing an unnaturally high number of returns. It has started identifying customers who have a record of higher number of returns than the average and adding a convenience fee of Rs 299 for subsequent purchases, ensuring that the cost of return is covered.

Customers who were Myntra loyalists because of their zero per cent return fee policy and leveraged it to buy large number of items and then return most, are dismayed. Many such customers spoke out about transferring their shopping to Amazon which continues to provide free returns. Of course, it remains to be seen if Amazon will join the bandwagon.

Charging customers for returns is a business policy that will see an immediate reduction on operating costs for e-retailers and discourage impulsive purchases which are more often than not returned. This is also a step towards wasteful consumption. The way forward for brands is to ensure that customers who wish to return can do so by visiting the nearest physical store and getting a reward for it. The returned goods are then immediately put back in circulation which unclutters the e-commerce inventory. Another way is to provide AI assisted online trials to help customers make the right choices, thereby doing away with the need to return.

The United Kingdom and Italy have partnered to enhance trade, boost economic growth, create jobs, increase wages and drive exports.

The partnership, the first of its kind between the UK and any EU country, also aims at boosting exports in various sectors and promoting inward investment in low-carbon industries such as offshore wind and carbon capture storage.

The agreement cements the UK's position as a vital trade partner within Europe and the G7, demonstrating the country’s potential as an independent trading nation to form comprehensive trade deals with new markets, while strengthening its partnerships with EU member countries. It marks a significant milestone in the UK’s trading relationship with Europe and shows how an independent UK can benefit from striking ambitious trade deals with the world, while also reinforcing its already strong and prosperous trading relationship with EU members such as Italy.

The partnership is expected to boost trade and investment between British and Italian businesses, ease the path for valuable investment, and grow UK exports. The UK and Italy are among the top ten global economies. Italy is the UK’s eleventh largest trading partner. In 2020-21, Italy was also the sixth largest recipient of UK foreign direct investment projects globally.

Saks’ spring 2023 campaign stars Emma Roberts. Told through a surrealist lens with bold and saturated colors, the campaign celebrates the spirit of individuality and inspires customers to express their identities through luxury fashion they can wear anytime and anywhere.

The campaign showcases an unparalleled assortment of spring fashion and accessories from iconic brands and emerging designers in unique content across Saks-owned channels and partner-owned editorial platforms.

Emma Roberts is actress, producer, and star of the new hit film Maybe I Do. She incorporates a season’s top trends into her everyday wardrobe and adapts her personal style to dress for the many aspects of her busy life.

Saks is a digital platform for luxury fashion.Saks remains focused on delivering a fresh and inspiring assortment of luxury fashion that serves every aspect of its clients’ unique lifestyles. Since Emma Roberts shares Saks' relatable approach to luxury fashion her fresh perspective on everyday dressing is expected to resonate with Saks’ customers.

Each season, Saks showcases the biggest trends and most sought-after styles that are breaking through the fashion scene. Top trends for the spring 2023 season include bare it all, minimalist tailoring, utility dressing, clear sequins, head-to-toe denim and the carryall tote bag.

Dubai Fashion Week will take place March 10 to 15, 2023. Dubai Design District (d3), a member of TECOM Group PJSC, and the Arab Fashion Council (AFC) has launched the official Dubai Fashion Week.

This will be the definitive fashion fixture emerging from the region, featuring men’s, women’s, ready-to-wear and couture collections. The aim is to cement Dubai as a global creative capital and build on Dubai’s status as a global hub for business growth and investment.

The event will provide a platform for emerging and established designers to grow their brands. Not only will regional designers get to meet and do business with international buyers and distributors, it will also serve as a gateway for international talent and brands to continue expanding their global footprint through the regional market.

Presenting Dubai as a global creative hub, Dubai Fashion Week aims at boosting fashion exports and attracting world-class investment.Over the last few years, Dubai has become one of the most dynamic places for the arts and creative industries. From economic activity to tourism and creativity, Dubai has carved its own space among the world’s cosmopolitan capitals, and fashion is one industry boosting its status.

Dubai has arrived on the global fashion stage. Emerging and established creatives have shaped a distinct identity for the region that resonates far and wide. The region’s fashion industry is entering a new chapter as it becomes increasingly active contributors to the global fashion narrative.

Asia Fashion Collection (AFC) has named five designers that will be debuting their autumn/winter 2023 collections at the organisation’s annual New York Fashion Week event.

The selection comes as part of a global incubator project held by the Asia Fashion Collection, which looks to support emerging designers from Asia in the beginning of their careers.

The initiative rounds out with an event each autumn/winter season, where the selected finalists take to the runway during a dedicated show at New York Fashion Week. Those who are participating have been selected from Asia Fashion Collection’s Tokyo show and will now take part in the organisation’s tenth annual event which will be held in New York on February 13, 2023.

To select the finalists, a panel of expert judges was present, such as Kaname Murakami, editor-in-chief of WWD Japan, Fumiya Yoshinouchi, Fashionsnap editor and director, and Keishu Abe of Tokyo Base.For this season, the finalists include Japanese designers Saika Sekita of Saika and Jun Nakamura from Désir, both of which are graduates from the Vantan Design Institute in Tokyo.They will be showing alongside South Korea’s Lee Young Eun, Taiwanese brand Chiahung by LCF graduate ChiaHung Su, and Parsons graduate Asato Kitamura.

In 2022, Adidas revenues increased one per cent in currency-neutral terms. In reported terms, sales were up six per cent.

The company’s gross margin reached a level of 47.3 per cent. In 2021 it was 50.7 per cent. In 2022 operating margin was three per cent. The company expects 2023 to be a year of transition to set the base to again be a growing and profitable company. Full focus will be put on the consumer, retail partners and employees.

Adidas expects currency-neutral sales to decline at a high-single-digit rate in 2023. The company’s underlying operating profit is projected to be around the break-even level. While the company continues to review future options for the utilization of its Yeezy inventory, this guidance already accounts for the significant adverse impact from not selling the existing stock. This would lower revenues and operating profit this year.Should the company decide not to repurpose any of the existing Yeezy product going forward, this would result in the write-off of the existing Yeezy inventory and would lower the company’s operating profit this year.

In addition, Adidas expects one-off costs in 2023. These costs are part of a strategic review the company is currently conducting aimed at reigniting profitable growth as of 2024.

By adopting Coats Digital’s Fast React, VT Garment has improved productivity tremendously.

By implementing this solution, the company has eliminated unnecessary overtime staff hours and boosted staff morale by simplifying the often challenging and stressful task of planning. The solution has also optimised overall planning time, reduced time spent loading orders and significantly reduced time people spent recording plan variations.

Prior to implementing FastReact, VT Garment found that the lack of automation and real-time visibility in the production planning process not only meant there was limited information sharing between different departments, but also that manually produced capacity plans based on unreliable historical data weretime consuming and cumbersome to produce and not accurate enough to make informed production decisions from.

VT Garment, based in Thailand, makes outerwear, sportswear and protective equipment such as ski jackets and pants, board shorts, polyester padded jackets, woven jackets and pants, knitted jackets and bulletproof armour-plated materials.

Coats Digital is the leading digital transformation partner for the fashion supply chain, powering sustainable processes and high value insights through connected technologies. Used in over 3,000 factories globally, its apparel, footwear and textile software and SaaS solutions improve agility, speed to market, efficiency, transparency and sustainability.

FastReact is an apparel production planning software solution.

Harper and Neyer is using Naiz Fit sizing solutions to reduce returns related to size and fit issues.

Harper and Neyer, based in Spain, is a men’s wear brand. Naiz Fit, a MySize product, is a provider of AI-driven measurement solutions.

Naiz Fit has emerged as the leading SaaS-based sizing solution for European fashion brands and retailers. MySize has deep marketing and service reach into the EU market, which is further fueling product adoption and accelerating growth for the MySize portfolio of sizing solutions.

Naiz Fit is being utilized across Harper and Neyer's global e-commerce sites. From fitted suits to preppy casual wear, with Naiz Fit, Harper and Neyer customers are ensured a perfect fit. With a strong European presence through 21 stores in Spain, France, Italy, Andorra, and Portugal, as well as Mexico, Harper and Neyer is a brand with a clear target for active men who love fashion and are in need of a stylish, elegant and casual outfit. Its customers have a distinct taste in style that Harper and Neyer's masculine collection embodies.

Since a proper fit is essential to style and comfort the Naiz Fit sizing tool seamlessly integrates into Harper and Neyer’s e-commerce sites to lead customers to the best size selection for their body and shape.

The predicted economic recession with a trade slowdown this year in the US and European countries has hit major garment export markets like Cambodia. And it is expected to have a far-reaching effect both on the country’s apparel industry and living standards of lower wage earners. Having always been dependent on garment exports as one of the largest foreign exchange earner accounting for almost 60 per cent of Cambodia’s total export value, the post-pandemic recession has hit the country hard.

Export figures expected fall further this year

Due to unfavourable global demand globally especially in the EU markets, the garment segment in Cambodia is expected to slowdown and clock in a growth of just 5.5 per cent this year from 14.5 per cent in 2022. “In its latest Global Economic Prospects report released in January 2023, the World Bank has cut its growth forecast for the US to 0.5 per cent and the EU to 0 per cent for 2023. The slow growth in these two important export markets for garments will significantly affect performance this year,” opined Jayant Menon, Senior Fellow with ISEAS-Yusof Ishak Institute in Singapore in an interview with Khmer Times.

After a fall of 6.1 per cent during pandemic times, the Cambodian garment industry was hopeful as it picked up with an identical 10.8 per cent growth in 2021 and 2022 as the world came back to normal. However, garment exports are expected to fall further to 5.5 per cent this year. Garment, footwear and travel goods segment are the biggest forex earning segment in Cambodia with around 1,100 factories and branches that boosts per capita income by giving employment to around 750,000 workers, mainly women.

US export keeps hope alive

However, not all industry analysts feel the situation is bad as they foresee Cambodian exports continuing to grow. As per World Bank’s recent data, the country’s goods exports grew at 28 per cent year on year (YoY) during January-August 2022. Exports of Cambodian garments to the EU will probably have a small impact, depending if the energy crisis in the EU is handled to a level where Cambodia can export, albeit at a lower level. Low growth across Europe in 2023 is a result of the spill-over effects from the Ukraine war along with strong downward revisions for economies mostly dependent on Russian gas.

The Euro economy which posted a growth of 5.2 per cent in 2021 and 3.1 per cent in 2022, is currently expected to grow only at 0.5 per cent in 2023 although the situation can be better soon, predicts the World Economic Outlook report of IMF.

Just last year, Cambodia exported garments, footwear, and travel goods worth over $9 billion. However, the EU decided in 2020, to withdraw tariff preferences under EBA. Yet, exports to the EU have been increasing continuously ever since, even though Cambodia does not have EBA and GSP.

The US apparel market remains a major destination for Cambodian exporters with many US fashion companies now placing more varied and different orders. The US was Cambodia’s largest export market accounting for 45.6 per cent of total exports last year. As more and more US fashion companies are focussing on expanding and diversifying their garment sourcing base after the supply chain disruption post pandemic, Cambodian garment industry remains hopeful they may be one of the beneficiaries.

Fashion’s eastern-most centre is the island nation of Japan. Seeped in a rich legacy, adherence to tradition, a fearless approach in the new world order, armed with innovation, Japan’s attitude is also expressed through its unique, bold fusion of design and colour palettes in fashion. More often than not, the West’s collections are often influenced by Japanese fashion trends. In light of the passing away of two top Japanese fashion icons Issey Miyake and Hanae Mori in 2022, the industry faced an irreplaceable loss.

So what impact did these events have on Japanese fashion? According to Vogue, 2023 will continue paying homage to these two national fashion heroes through vintage kimonos and the Issey Miyake pleats, distressed patchwork, popcorn tops and a casual and vibrant interpretation of the Mori suits. Nigo. The popular Tokyo-based designer known for his urban street-wear is now on the rise as he presented his first collection as the artistic director of Kenzo, an LMVH brand, in Paris last month.

As a country that ranks 11th in the world order of nations that have taken the cause of sustainability seriously, sustainable fashion is being spearheaded by local designers through use of traditional methods combined with innovative production technologies

Motta Nai or What A Waste

Originating from a Buddhist belief that every object has intrinsic value and should be utilized for its full life cycle, the credo has been threaded throughout national culture for centuries. “Mottainai and handmade culture is everywhere in Japan," points out Kaoru Imajo, Director, Japan Fashion Week Organization. A number of Japanese fashion labels are channeling these traditional ideas in the name of sustainability, embracing centuries-old garment production techniques and pioneering new technology to reduce waste and lessen environmental harm throughout the production process.

In direct contrast to Japan’s efforts towards sustainable fashion, the irony is that Chinese fast-fashion brand Shein chose Tokyo for its first brick and mortar store in the world. The outlet opened on November 13, 2022, in the busy fashion precinct of Harajuku and the collection is designed with young Japanese consumers in mind. Apart from fulfilling their D2C commitment in Japan, Shein is now establishing its physical presence. The store is being used as a physical showcase as no direct purchase is possible – customers scan the QR code at the store and have their product shipped home as Shein continues its digital first philosophy. The industry gossip is that Shein might issue IPOs in the US and Japan in 2024. Shein has refused to comment on this matter though.

Itochu plays to its strengths

Recent news has it that Itochu, the Japanese conglomerate is bringing back popular brands Edie Bauer and Forever 21 to Japan this year. Itochu also acquired master license rights to many other brands, including Eddie Bauer, L.L. Bean and Forever 21 in 2022. In April 2022, the company acquired majority stake in Dome Corp, which represents Under Armour in Japan, and formed a joint management system with the US sports apparel company. Itochu also obtained the marketing rights and license rights to Reebok in May. In 2019, the company tookover Descente and improved its management. Itochu has understood the growth of the athleisure and sportswear market since the onset of the pandemic and is actively pursuing establishing its acquired licenses and pitting itself directly against Nike, Puma and ASICS in 2023.

India looking to emerge a strong sourcing destination

Tapping into the Japanese market India’s Apparel Export Promotion Council (AEPC) is organising the first edition of Upnext India 2023, starting with a Reverse Buyer Seller Meet with Japan. Being held in Gurugram, India on February 10 and 11, more than 50 prominent Japanese brands including Sumitomo, Toyoshima, Marubeni, Mitsubishi, United Arrows and MYK Fashion will be attending to source readymade garments from here. Over 75 Indian RMG manufacturers have confirmed their participation. This initiative is supported by the Commerce Department under the Market Access Initiative Scheme.

And as says Naren Goenka, Chairman, AEPC, in light of the fact that Japan is the fourth largest garment importer in the world, with its apparel imports being stable even during pandemic and Indian apparel having duty-free access under the Indo-Japan trade agreement as against 9 per cent for Turkey and 9.5 per cent for China, it makes business sense for Indian readymade garment manufacturers and exporters to participate in this opportunity. With total garment imports of Japan of $23 billion, against India's exports of $0.22 billion, a strong Indian garment industry with its unique offerings has a huge scope for Japanese trading companies to source from India, it added. Goenka points out Japanese companies have two competitive advantages as apparel sourcing base -- sourcing cost and flexibility and agility.