A New Generation Of Even Faster Fashion Is Leaving H&M And Zara In The Dust

by MR Magazine Staff

Zara and H&M are the world’s two largest fashion brands. Not by coincidence, they’re also the pioneers of fast fashion. Zara is able to take a coat from design to the sales floor in 25 days, and it can replenish items even more quickly. In the past couple of decades, the two companies have steadily trounced much of their competition, outdoing them on price and speed to claim an ever-larger share of shoppers’ spending. But both are being beat at their own game by even faster competitors. British fashion retailers Asos and Boohoo are both able to design, produce, and have clothing ready for shoppers on the sales floor quicker than Zara and H&M, according to a research note Goldman Sachs sent investors last month, and the two millennial-focused, social-media savvy brands are enjoying the rewards. On April 4, Asos lifted its sales forecast for the year, expecting sales to grow between 30% and 35%. Boohoo also recently raised its earnings forecast, predicting sales growth of around 50% for the year. Unbeknownst to many, its shares rose more in 2016 than those of any other Western European consumer-related company with a market capitalization of more than $500 million. Goldman Sachs charted the correlation between supply-chain lead times and like-for-like (LFL) sales growth, and the results show just how much speed matters. It allows brands to respond to the market quickly, which means they can adjust their inventory to match trends as they happen, and it keeps them from having to produce a large amount of stock in advance that then risks not selling and being discounted. Read more at Quartz.