This article was originally released by Business Of Fashion.
SHANGHAI, China — Shanghai-based stylist and creative director Alice Wang cancelled her fashion week plans when she received a job offer to style a local musical artist for a special performance. But the rapid spread of the respiratory illness 2019-nCoV, or, novel coronavirus — resulting in over 560 deaths, travel bans, store closures and face mask shortages — means that neither the styling gig nor fashion week are on the agenda.
“I’ve been at home in my apartment for the past five days without setting foot outside,” says Wang, who has been using mobile apps to order everyday essentials like groceries to her door. The entrepreneur was also meant to be buying fabrics for what will become her own brand’s debut collection, but countrywide factory closures have prevented her from making much progress. “Everything has pretty much been cancelled or delayed until who knows when,” she tells BoF.
Demand Goes Digital
As physical retail suffers, the crisis could mean room for China’s e-commerce industry to grow. “Given that most Chinese consumers are staying home,” says Fitch Solution’s Lin, “online shopping offers a conduit to shop and also a form of distraction... the demand for non-essential shopping may increase as a result.”
According to Azoya Group’s Shenzhen-based Marketing and Partnerships Manager Ker Zheng, the 2003 SARS outbreak kickstarted China’s e-commerce ecosystem — Alibaba's B2B e-commerce business thrived after foreign businessmen cancelled trips to China and registered for its online services, while JD.com Founder Richard Liu began selling electronics on forums and chat groups to keep his business afloat during the outbreak.
But the increase in demand for household goods, over-the-counter pharmaceutical products and groceries won’t necessarily be mirrored in beauty and apparel. “It depends on the category,” says Azoya’s Zheng. “For discretionary purchases like luxury or cosmetics or fashion, it might be more difficult.” There are also concerns that consumers will steer clear of goods made in or around Hubei province, and that this will extend to goods produced elsewhere in China, on a global scale.
Shows and Small Brands Feel the Impact
As global giants brace themselves, China’s event organisers and designers are most vulnerable to risks and will bear the brunt of the shutdowns, says designer incubator Labelhood’s Founder Tasha Liu. She reckons that if brands are unable to showcase or sell their collections this coming season, losses could carry through into the next three or four.
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