Luxury fashion
The Jubilee celebrations showcased opulence, reflecting the UK's strong luxury market, which generated about £1.69 million in sales in 2020 and ranked sixth globally. E‑commerce retailers are increasingly targeting luxury consumers to move beyond the competitive mass‑market space.
Amazon's launch of Luxury Stores in the UK marks a strategic expansion. First introduced in the US in 2020, Luxury Stores offers high‑end brands across apparel, accessories and beauty. As of 8 June, the platform is available in the UK and several European markets. The move aims to provide a technology‑enhanced sales channel and position Amazon within a segment it previously lacked.
It remains uncertain whether Amazon can compete with established UK luxury platforms such as Net-a-Porter and MatchesFashion. Financial stability may prove decisive. YOOX Net‑a‑Porter has struggled to meet profit forecasts, prompting parent company Richemont to seek minority investors, including Farfetch. MatchesFashion reported a 10 per cent revenue decline and a £36.6 million loss in 2021, driven by pandemic restrictions, supply chain issues, leadership changes and post‑Brexit regulation. By contrast, Amazon's UK revenue has grown consistently since 2010, giving it greater resilience.
Digitalisation continues
Farfetch is pursuing competitive advantage through cryptocurrency payments. On 10 June, the company announced plans to let UK customers pay with seven cryptocurrencies, including Bitcoin and Ethereum.
Farfetch's leadership has also highlighted ambitions in emerging digital environments such as the metaverse, NFTs and alternative virtual spaces, describing them as the next stage of luxury shopping. Threads Styling is similarly investing in innovation, securing £9.7 million in venture capital funding to expand its personalised, real‑time shopping model and enhance live event and website functionality.
Mass‑market fashion
The mass‑market segment has seen mixed developments. The British Retail Consortium reported a 17 per cent increase in shop visits over the Jubilee weekend and a 3.1 per cent rise in sales.
Walmart announced plans to invite UK sellers to join its US online marketplace, offering access to 120 million monthly customers and a robust supply chain with two‑day delivery. This initiative supports the UK government's Made in the UK, Sold to the World campaign. Walmart, Payoneer and Linnworks scheduled a UK Sellers Summit for 17 June.
Ted Baker's market value fell 24 per cent after a preferred bidder withdrew unexpectedly. The bidder remains undisclosed. Earlier in March, Ted Baker rejected a £250 million takeover offer from Sycamore Partners.
Sustainability pressures
Sustainability continues to shape mass‑market strategy. Zara introduced a £1.9 online returns fee to encourage in‑store returns. Next, Mango and Uniqlo have implemented similar fees, and Boohoo is considering the change. Consumer acceptance remains uncertain, particularly given limited store locations and expectations of free returns.
Shein attracted attention after announcing a £12 million donation to the Or Foundation at the Global Fashion Summit in Copenhagen. The funds will support apprenticeships for women, textile recycling and improved working conditions at Ghana's Kantamanto Market. The donation forms part of Shein's £50 million Extended Producer Responsibility Fund.
Asos announced a partnership with Thrift+ to trial a resale programme and launched another circular design collection, signalling commitment to sustainable fashion.
The real price of fast fashion
Missguided's insolvency has highlighted severe consequences for suppliers. Reports indicate unpaid invoices in the millions, delayed deliveries and refusal to refund customer returns. In Pakistan, suppliers have been unable to pay garment workers for over four months. One supplier in Faisalabad claims to be owed over £2 million after producing 200,000 pieces per month since 2019 and expanding its workforce at Missguided's request.
Boohoo has also faced criticism. Shareholders reacted negatively to reports of executive pay increases amid allegations that factory workers are underpaid. Activist groups estimate a £125 million pay gap, though Boohoo disputes the figures and notes its £1 million donation to establish an independent workers' rights charity. A study commissioned by the Garment and Textile Workers Trust found widespread issues in Leicester factories, including lack of sick and holiday pay and wages below minimum levels.
Impact of inflation and sanctions on Russia
Market volatility stems from supply chain disruption, rising inflation and widespread suspension of business operations in Russia. Farfetch reported losses of £31.2 million in the first quarter of 2022, with Russia previously contributing 6 per cent of revenue. Asos warned that high return rates and its exit from Russia may affect earnings.
Other companies, including Boohoo, Burberry, JD Sports, LUSH and Manolo Blahnik, have withdrawn from Russia. Revlon's UK subsidiary was included in the company's Chapter 11 bankruptcy filing on 16 June due to supply chain issues and inflation.
Conclusion
Most fashion companies have not indicated plans to re‑enter the Russian market. Law firms can expect increased demand for advice on sanctions compliance, alternative market-entry strategies, and business model adaptation. Digitalisation, cross‑border expansion and innovation will continue to drive legal work in commercial, regulatory and international matters.
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