Is Melania Trumping Trade Concerns?

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Designer Sophie Theallet's call for the fashion industry to boycott America's future First Lady, Melania Trump, noting the "rhetoric of racism, sexism and xenophobia unleashed" by the campaign of her husband, US President-elect Donald Trump, was largely met by silence from her fellow designers. That is, until Tommy Hilfiger, quizzed on the matter earlier this week, called Melania Trump a "very beautiful woman," adding that "any designer should be proud to dress her" and that fashion brands should not "become political about it."

Pete Nordstrom, co-president of the Nordstrom department store chain, also joined the debate on boycotting the Trumps, taking a more measured approach. The American retailer, he wrote in a message to employees, would “strive to be agnostic about politics” and continue selling the Ivanka Trump brand despite customer complaints. “Every single brand we offer is evaluated on their results — if people don’t buy it, we won’t sell it,” he continued, adding that the Ivanka Trump line “has grown to be a sizeable and successful business.”

But is this really the debate we should be having?

While many in America's fashion industry were busy tussling over the merits of selling Ivanka Trump or dressing the future First Lady, President-elect Donald Trump made a video statement threatening to quit the Trans-Pacific Partnership (TPP) on his first day in the White House, effectively killing a free trade deal already signed (but not yet ratified) by 12 Pacific Rim countries — including the US, Australia, Canada, Japan, Malaysia, Mexico and Vietnam — which together account for 40 percent of the world's economy, a move with far greater implications for the apparel and accessories business.

According to the American Apparel & Footwear Association (AAFA), a Washington, DC-based trade organisation, 97 percent of clothes sold last year in the US — the world’s largest retail market — were imported, not just from China (which isn’t a party to the TPP deal), but also from other offshore manufacturing centres like Vietnam. American sportswear giant Nike, for one, manufactures more shoes in Vietnam than anywhere else and currently pays a steep tariff on each pair imported from the country to the US. Proponents of the TPP deal have argued that lowering tariffs means companies will be able to pass on the resulting savings to consumers, thus lowering prices and encouraging greater spending, helping to fuel the economy. What’s more, for companies that manufacture in the US, the TPP would make American-made products cheaper and hence more attractive in other countries.

But the issue goes far beyond the US alone. As a new strain of nativist, far-right nationalism takes root across the Western world, emboldened by Trump’s victory, the threat of growing protectionism is very real, with negative consequences for fashion’s global supply chains. Indeed, this week, it became more clear than ever that Marine Le Pen, leader of France’s far-right Front National party, who has called for the country to quit the European Union, could well triumph in the upcoming French presidential election, dealing another blow to free trade, something that is much more important to the global fashion industry than what America’s future First Lady does or doesn’t wear.

THE NEWS IN BRIEF

BUSINESS AND THE ECONOMY

Swiss watch exports tumble as demand falls. The number of Swiss watch exports fell by 16 percent last month — the biggest monthly drop in seven years — due to falling demand in markets like Hong Kong and the US. The Federation of the Swiss Watch Industry said shipments fell to 1.68 million francs ($1.7 billion), adding to fears over the longest slump in the industry for more than two decades with companies like Richemont planning to cut more than 200 positions as demand falls.

J.Crew losses shrink. American retailer J.Crew reported a smaller third quarter loss, thanks to an $845.9 million impairment loss in the previous year. The company is trying to turn itself around, and lure back shoppers to help rebalance its finance sheets after an extended sales slump. Earlier this month, J.Crew said it planned to focus on its core products and would no longer sell its bridal line.

Suno closes shop. The New York-based women's fashion line — known for its eclectic prints, social responsibility and small-batch production — confirmed that it has ceased operations after eight years. The company had built up a steady following and attracted praise from publications like American Vogue and The New York Times, but was unable to secure an investor to help maintain operations and take the company to the next stage of growth, according to sources. Cruise 2017 will be its last collection.

Retailers approve Bangladesh factories despite safety concerns. An independent report has found that an organisation backed by fashion retailers Gap, Target and Walmart has approved the building conditions of some Bangladeshi factories, despite the fact they have yet to implement key renovations needed following the deadly Rana Plaza collapse three and a half years ago that killed 1,137 people. The Alliance consortium, a voluntary organisation formed after the tragedy by the retailers, is understood to have pushed back deadlines to install fire exits, alarms and key structural renovations needed to ensure the safety of factory workers.

Abercrombie & Fitch pulls out of Hong Kong. US clothing brand Abercrombie & Fitch has announced that it will close its flagship store in Hong Kong, two years earlier than its lease is due to expire in 2019, as concerns over declining footfall from mainland Chinese shoppers continue to grow. The closure is expected to be complete by the second quarter of 2017, and follows the news that the company will also close around 50 stores in the US this year.

Topshop warehouse staff announce strike. More than 100 workers at British retailer Topshop's online distribution centre announced plans to strike on Cyber Monday, one of the busiest shopping days of the year, according to workers union GMB. The news comes as a fresh blow to its owner, Philip Green who is facing calls for his assets to be seized to help settle a £571 pension deficit at BHS, the now collapsed retail chain that Green oversaw for 15 years.

PEOPLE

CRFashionBook.com | Source: Courtesy

Carine Roitfeld signs digital publishing deal with Hearst. Fashion editor Carine Roitfeld is deepening her partnership with Hearst, which will host CRFashionBook.com on its publishing platform MediaOS. While Roitfeld's team will be responsible for the creation of all editorial content, Hearst will manage the task of monetising the title's digital and social media content. Roitfeld ended her previous publishing agreement with Fashion MediaGroup, owned by Stephan Gan, in September.

Deborah Needleman departs T Magazine. After more than four years at the editor in chief of T: The New York Times Magazine, veteran fashion editor Needleman is leaving the title. Under her tenure, Needleman expanded the magazine's editorial coverage from fashion and design into a general-interest luxury style magazine, making it one of several fashion newspaper supplements that have successfully attracted advertisers against an increasing challenging backdrop for magazine publishers. A replacement for Needleman is yet to be named.

Ivanka Trump severs social media accounts from brand. The future first daughter has announced that she will now only use her social media accounts for personal messages, separating them from her brand-related news. The businesswoman has come under fire in recent weeks over conflicts of interest ahead of her father Donald Trump's ascension to the White House after her company promoted a gold bracelet from her own jewellery line that she wore during an interview with her father.

TECHNOLOGY

Amazon in talks to buy Souq.com for $1 billion. Amazon is reported to be in discussions to acquire Dubai-based online retailer Souq.com for around $1 billion, a deal that will help give the e-commerce giant a larger footprint in the fast growing Middle Eastern market. Amazon is understood to be considering a bid for all of the site, which sells more than 1.5 million products online to customers in United Arab Emirates, Egypt and Saudi Arabia. No final agreements have been reached however.

Instagram introduces new video and chat features. Instagram is adding two more features to its offering, live video and auto-deleting messaging, placing the picture-sharing app directly in competition with some of its social media peers like Snapchat. The features will be followed out to a small group of users this week, which will expand to a wider audience over the next few weeks. Earlier this year, Instagram adopted video sharing to its network.

Rocket Internet's cost cuts help shrink losses. Online clothing retailer Rocket Internet reported a smaller-than-expected loss in the third quarter helped by a rise in sales and cost-cutting measures. The company, which is backed by Global Fashion Group, said its adjusted loss narrowed to €32.3 million ($34.3 million) from €54 million a year earlier while net revenue rose by 16 percent on a constant-currency basis to €250 million.

EBay introduces Mobile Wednesday. Online auction house EBay is introducing its own branded online shopping day in a bid to keep up with its rivals with Amazon and Alibaba, who have created Prime Day and Singles' Day. The company is hoping to persuade customers to spend more online during the Thanksgiving holiday period with Mobile Wednesday, offering discounts to mobile customers who may be travelling to celebrate the season.