The Ccoronavirus has hit luxury brands particularly hard as many of them rely on China as a significant source of business. The virus has impacted their business, not just on a logistical level, but in terms of sales. Burberry has already temporarily closed 24 of its 64 stores in China. Alibaba’s next quarterly financial earnings are expected to reflect a significant downturn because of the Coronavirus. And there could be more long-term effects on the horizon. Brands that don’t necessarily sell or manufacture in China could be affected if their core customer is a frequent traveler. Travel brands, airport retail and tourist destinations could all see an effect as more travel restrictions on who can enter and leave the country are put in place. More than 50 countries around the world, including the US, Italy and Australia, have restricted travel to and from China.

China will likely stay a major player in both manufacturing and consuming fashion once the virus has subsided. But brands are already reconsidering putting all their proverbial eggs in China’s basket due to the China-US trade war. This crisis may only exacerbate those feelings. In the long term, more retailers can be expected to spread production, sourcing and manufacturing across countries to avoid future risk.