How will this world wide financial crisis alter your shopping habits?

[UNiQFashionista]

This is insane whats going on! I don't think retailers are going to lower their prices, I think its us the consumers who will have to cut our budgets. what do you guys think?


How will these events change you and the fashion business?


MODS, pls move if in wrong forum.

 

[Needlecrush]

If the crisis continues many companies will have to close the doors. The smallest first. There are still some brands depending only on their names but with many financial problems. They will be the next victim of the crisis. After that...I believe only the provocative ones will survive!

 

[Grill]

Uniq... this is a valid thread and an interesting topic.

You're right retailers definitely aren't going to lower their prices - and why should they?! Lowering their prices won't draw customers in particularly as this global recession/depression looks like its going to be more severe and long lasting than anyone could have predicted. For a lot of people ALL non-essential spending will be restricted with rising oil and food prices . I imagine designers will cope with this downturn by focusing on wearable fashion or to put it more correctly their versions of classic/timeless/signature pieces - for example, Alber Elbaz re-working and perfecting those amazing Lanvin dresses, pearls and cover-ups many of which look like familiar favourites but in a slightly different guise. On the other hand others designers may react by designing couture like pieces at high prices which speak volumes and act almost as wearable works of art.

I have a feeling that designers such as the Row and other purveyors of quiet luxe might suffer in this downturn. I do hope that none of the smaller labels go out of business but only time will tell. Everyone's going to be feeling this though! Prada IPO listing won't happen yet again, boutique openings and the like might be postponed or not happen at all.

Personally, I am curtailing my personal spending. I'm trying to buy things that will work with existing pieces and stuff that I know will stand the test of time. Impulse buys, those extra jeans, odd and exorbitant face creams and shampoos, multiple ballet flats purchases will have to go.

 

[Meg]

It's interesting. I think a couple of things will happen. Those at the very top, the upper echelons (ie those with capital in excess of 30 - 50 million) will continue to buy as they have done before, and in fact, for example in London, homes with costs in excess of 10million pounds have not lost customers and have experienced 0.4% growth. Those mid range designers that produce similar looking garments between 250 - 800 will suffer as the middle and upper middle class contract.

I also think retailers will continue to expand their locations in the Middle East and Russia, those locations that have a much more safe upper class.

Personally, I'm in uni and didn't have loads of spending money to begin with. Since I'm in a slightly more insulated market (Canada) and don't have much investment, I don't have that much to lose My mother is definitely concerned but I haven't drastically altered my spending habits.

 

[fashion_boi_01]

I too am a university student in Canada, and my fear is what impact this may have on tuition fees. If the government cuts any funding to universities (without an increase in student loans) then I'll need to take on more hours at work in order to fund my education. For now I haven't seen any signs of something like that happening, but I'll watch out. I will still spend as I always have, since I shop quite responsibly and I always prioritize.

 

[softgrey]

i'm sort of torn..
there are two options as i see it...
at least for me...


*do i buy more special pieces now because i want some bang for my buck???

or

*do i buy really basic pieces that are easier to wear and have some lasting power???


* one thing i would say is not to invest in trends...
though- that's sort of a no-brainer in my book anyway......

maybe it's just about having a few great outfits that you just wear all the time...
sort of like a uniform in a way..?

i think the place that you really need to invest is probably footwear...
in order to keep things looking current...

good footwear and good outerwear....


* i just spent a buttload of money on a new yohji jacket this past weekend...
and a bulky cardigan at rogan...
and i ordered several pairs of the same pants that just work really well and are really inexpensive..

so at least i am on the right track i guess...

...

*maybe...???...

 

[amandabug]

that's a really good question, one that i've asked on my blog. i've been cutting back on my shopping since early this summer when i was trying to get rid of some credit card debt, and now with the economy tanking i haven't gone back to my old ways. i used to buy new clothes every week, sometimes three times a week, now i've gone two weeks with only one purchase. (that's a big reduction for someone like me)

 

[Grill]

It's interesting. I think a couple of things will happen. Those at the very top, the upper echelons (ie those with capital in excess of 30 - 50 million) will continue to buy as they have done before, and in fact, for example in London, homes with costs in excess of 10million pounds have not lost customers and have experienced 0.4% growth. Those mid range designers that produce similar looking garments between 250 - 800 will suffer as the middle and upper middle class contract.

I also think retailers will continue to expand their locations in the Middle East and Russia, those locations that have a much more safe upper class.

Personally, I'm in uni and didn't have loads of spending money to begin with. Since I'm in a slightly more insulated market (Canada) and don't have much investment, I don't have that much to lose My mother is definitely concerned but I haven't drastically altered my spending habits.

Meg - I just have to point out that class - social position - at least in the UK and the older established Western societies - is not governed by money. For example, you can be upper class / aristocratic and broke. There's many a Lord and a Lady who've had to sell their country pile. Nouveau Riche (the newly wealthly) footballers wives, hollywood rich etc., maybe monied but they don't necessarily have class. Class is dependent on numerous factors - most importantly family background and education - even to some extent what you choose to eat - and yes, to some degree wealth but this has to do with the wealth of previous generations. The middle class as such will therefore not be contracting under during the recession even while their capacity to spend will do. Becoming poor will not therefore make them working class! Sorry to be a pedant....

 

[dumbfairy]

^I think maybe Meg was using the term class in general,what you say is very true however.

Will the global credit crunch affect me? Not in the slightest! I have absolutly no money in savings,neither does my Mother,no property or anything. In fact I owe the bank a little But I will continue to spend and buy as I do.If the World ends tomorrow or we all lose our jobs and houses,at least I'll be one well dressed hobo

 

[seanutbutter]

Will the global credit crunch affect me? Not in the slightest! I have absolutly no money in savings,neither does my Mother,no property or anything. In fact I owe the bank a little But I will continue to spend and buy as I do.If the World ends tomorrow or we all lose our jobs and houses,at least I'll be one well dressed hobo

But say the world doesn't end tomorrow - won't you just be in more debt, regardless of how well dressed you may be?

 

[ellesea]

Since the market crash, I have been doing a LOT more retail therapy. Unfortunately, my work is directly affected by the markets. My phone/fax/e-mail/etc/etc have been going off like crazy, everyone in the office is pulling extra hours even though they're trying to hire tons more people. And so I've been looking to online stores and trips across the border for a shopping fix.

But I should curtail that soon just in case the economy gets worse.

I think in terms of fashion itself, I will look more towards things that are COMFORTABLE and CLASSIC. Buy more to compliment what's already in my wardrobe......

 

[Diorlover]

*do i buy more special pieces now because i want some bang for my buck???

I don't know how clever this idea is, since I've never been an economic buff....but I've been thinking about taking out all my savings since I don't really trust the banks....and well....spending it all on investment pieces that will last me forever. I just dont want to save and save only for my money to be worth so little at the end

 

[silk skin paws]

I feel bad for small and struggling businesses. They are the ones who really feel the hit. I noticed that I'm more keen on what I'm purchasing. Thankfully I stopped purchasing things I don't wear. I wear everything in my wardrobe.

 

[dumbfairy]

But say the world doesn't end tomorrow - won't you just be in more debt, regardless of how well dressed you may be?

But the world has ended,so it's a no win situation

I don't spend above my means on material items,probably what bumps up everything is excessive bills and rent.

I'm not fearful of the future in the slightest, and I'm an Economics student, we're supposed to fear and plan for the worst For me personally,I have very little to fear I feel.

 

[leyla m.]

interesting subject uniq!
even though i strongly believe that the luxury sector is less touched by this issue, i do believe that this crunch will highly affect the mass market and therefore the high street...
i think personally i would also invest in more basic but luxurious pieces... but i do that anyway

 

[justlooking]

it's very frustrating. Apparently the Australian dollar is a good indicator of how well the word market is doing. A few months ago the Australian dollar was at an all time high of 98c for 1 US dollar. The other night it hit a low of 64c. A few months ago, we were over 100c against the japanese yen. Now we're down to 67c. It's the worst rate since the 1990s. The Reserve Bank is decreasing the interest rate and people are pulling out their money from Aus, hence devaluing our dollar (that's as much economics as i'll ever understand).

I paid 1/3 more for an already overpriced bag by not buying it a few days earlier.

It's definately going to reign in my online purchases (my main source of shopping) purely for the reason that i don't want to pay more than what i know i could have paid. for the first time in a long time, it's going to make more sense to buy overpriced designer items here (the ones that are already on the shelves) in Aus rather than online.

Like Lelya, i've subscribed to the basic but luxurious anway, so it won't affect my selection i don't think.
As for style...Marc Jacobs 09 depression chic? No thank you.

 

[fashion_boi_01]

I don't know how clever this idea is, since I've never been an economic buff....but I've been thinking about taking out all my savings since I don't really trust the banks....and well....spending it all on investment pieces that will last me forever. I just dont want to save and save only for my money to be worth so little at the end

I'm not sure how banking policy works in England, but here in Canada as well as the States we have deposit insurance, meaning even if the bank goes under, deposits up to $100,000 (and I believe now $200,000 in the States) are safe. This was the case with Washington Mutual, one of the largest banks went under, but all of the cash was transferred to the new owner, JP Morgan, untouched.

 

[MissMagAddict]

^Yes... but just because your deposit is insured up to $200,000 doesn't mean you would be able to have access to your money right away if the bank fails. It could take days or even weeks depending on the situation.

 

[Meg]

yeah Grill, I've lived in Britain for several years, I wasn't referring to the British class system, but the North American one and was referring to it purely in monetary terms.

If you withdraw your money from the bank, that's when real problems happens. Part of the problems with Northern Rock in Britain last summer was people lost confidence in the bank, began withdrawing their savings, and (as far as I understand it) that decreases a bank's liquid capital, causing a run on the bank and then it bottoms out. Same for the economy in general. If people fear that they are going to lose money, they stop spending, when you stop spending you stop injecting cash into the market and then things contract.

Canada, as I said before, is a bit more insulated as far as I can tell. In the 1980's we underwent our own mini subprime mortgage crisis that hit a lot of Canadians and since then, and due to our slower rate of economic growth, the Canadian oversight body on mortgages has been a lot tighter with qualifying. Six months ago they made it mandatory to have a minimum 5% deposit on mortgages. In general as well, because a lot of the growth in our economy has been due to natural resources (ie gas, oil, minerals) we are better off than others. Of course, we have heavy trade relationships with the US but many Canadians have been, and are continuing to take advantage of the US crisis and buy second homes at cut rates.

 

[fashion_boi_01]

If you withdraw your money from the bank, that's when real problems happens. Part of the problems with Northern Rock in Britain last summer was people lost confidence in the bank, began withdrawing their savings, and (as far as I understand it) that decreases a bank's liquid capital, causing a run on the bank and then it bottoms out. Same for the economy in general. If people fear that they are going to lose money, they stop spending, when you stop spending you stop injecting cash into the market and then things contract.

Yeah, if you withdraw then that decreases the reserves. Banks are only allowed to lend out based on the amount of cash they have in savings, and it's not a $1 savings - $1 loan ratio, so the problem becomes magnified tremendously with the very little availability of credit. Our entire monetary system works because of the belief that people (in the aggregate) don't need and won't access their savings.