Published 13 March 2023 at 08.28
Economics. The erosion of consumers' purchasing power is hitting a fashion trade that is already exposed to severe trials.
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Svensk Handel's Style Index for February shows that the industry faces major challenges in the form of, among other things, reduced sales.
– Unfortunately, we see how the gloomy trend continues. The fashion trade is under pressure from all sides. Increased living costs make customers hold tighter in their wallets, while many stores have received a rent increase of over 11 percent since the turn of the year. We are seriously concerned that many shops and jobs will disappear, says Sofia Larsen, CEO of Swedish Trade.
The clothing trade is noted for a marginal increase of 6.1 percentage points compared to the same month last year. An increase of 0.7 percentage points is also noted in the shoe trade. However, the figures in the Style Index are presented in current prices, which means that this month's figures are a decrease measured in fixed prices.
– The fashion stores are among those that are affected the absolute worst by the sharp rent increases. Rents' share of turnover is increasing, which creates great concern. The situation is serious and ultimately it is jobs and entrepreneurship that are at stake, says Sofia Larsen in a press release.
Now at the end of the month, another cost increase awaits as the government has chosen to go ahead with raising the employer's contribution for young.
– Doing it in this situation, when we are facing a recession, not only hits fashion stores around the country hard, but it also of course affects younger people who want to work in the trade, either immediately after the student, or in combination with studies. Our appeal to the government is clear – think again, says Sofia Larsen