Despite all of the disruption, upheaval, and new faces that emerged in fashion last year, according to a recent piece from Quartz, a mere 20 companies accounted for nearly all the industry’s profits.
“The global fashion business is becoming increasingly polarized,” Quartz said, referencing a recent study commissioned by McKinsey & Company and BoF. “On one side, you’ll find a handful of [companies] that, because of their scale, design, price, [or] business model… generate the great majority of the industry’s profits. On the other side, pretty much everyone else.”
According to the story, the top 20 have more or less retained the same profit share for years now (12 of them have held top spots since at least 2008), while the number of “value-destroying” companies – ie, brands that lost money – “nearly doubled between 2010 and 2017.”
So what’s keeping fashion’s version of the One Percent above the fold? It’s less about the product, and more about the business. “[Even though] their sales weren’t always exceptionally high compared to the wider sample… they had better margins and were far more efficient with their capital. They also enjoyed a big advantage from their scale.”
The full top 20 list is below.
Fast Retailing (Uniqlo)
And you can read more about it at Quartz.