Brexit, the COVID-19 pandemic and the war in Ukraine have caused significant financial disruption for many UK FTT businesses.
- The increase in shipment costs, import and export duty tariffs and the sheer rise in energy and raw materials has made it increasingly difficult for businesses to operate, says a new report.
THE RESEARCH: The report has been jointly published by the Business of Fashion, Textiles and Technology (BFTT) led by the University of the Arts London and the Future Fashion Factory (FFF) led by the University of Leeds with UKFT’s Adam Mansell as chair of the project.
THE FINDINGS: Here's a summary of the findings, clubbed under different heads.
Brexit and Covid: According to the report—Impact of Brexit and COVID-19 on the UK Fashion and Textiles Technology Ecosystem—the COVID-19 pandemic has had lasting financial impacts owing to the closures of businesses on the high street and the initial closure of factories during the first lock downs.
- While some businesses have found ways to mitigate these impacts, others have remained more vulnerable, particularly smaller start-up businesses who are unable to incur these increased costs associated with import and export tariffs and energy prices, while maintaining a business that can endure the lasting impacts of the pandemic.
Skills Shortage: Brexit and the COVID-19 pandemic have contributed to the decline in skilled workers within the UK FTT ecosystem.
- The introduction of new visa requirements to work in the UK after Brexit, coupled with the migration of non-UK citizens back to their homeland during the pandemic as a result of redundancies or the furlough scheme, has meant that many UK FTT businesses are now struggling to find people with the necessary skillset.
- This has secondary impacts such as impeded business growth and difficulties in the retainment of current staff due to the ever-increasing competition within the industry.
Resilience: While businesses within the UK FTT ecosystem have faced unprecedented times over the past few years, the resilience and determination of companies has been remarkable.
- Many have made redundancies, closed factories, lost business to EU markets and suffered significant financial losses. Yet, there was an overwhelming sense in the industry to carry on regardless with numerous businesses diversifying into new market areas and making positive changes to their business.
Business Diversification, Innovation and Digital Acceleration: During the pandemic, many FTT businesses found time to reflect on the strategy and structure within the company, with many adopting new ways of working, such as flexible working practices or changes in the operational functions.
- Second, the pandemic also prompted businesses to diversify, with many manufacturing businesses producing essential items deemed necessary during the pandemic, while others have developed innovative new solutions or materials.
- Digitalisation has also been a key driver in varying areas of the supply chain, including marketing, design and manufacturing.
Environmentally Conscious Attitudes towards more sustainable business models and impacts that companies have on the environment are certainly apparent within the FTT ecosystem.
- Businesses are mindful of their material choices, working practices, generation of waste and their carbon footprint. And while the recent global challenges may have been a time to reflect on business policies, this has not been a key driver in decision making, with most businesses already working towards a more sustainable and environmentally conscious future including the UK net zero strategy.
