The Italian fashion industry is grappling with substantial losses as a result of the Covid-19 pandemic. According to a recent study conducted by Sistema Moda Italia (SMI), the association of Italy’s textile and apparel manufacturers, the fashion and textile sector experienced a revenue drop of more than €3.5 billion in the first quarter of 2020.
The study involved a survey of various companies, and the findings revealed that 49% of them reported a decline in orders ranging from 20% to 50% compared to the same period last year. An additional 29% witnessed a decrease in orders between 10% and 20%. Marino Vago, the president of SMI, anticipates an even more severe decline for the rest of the year. The association estimates that exports, which heavily drive Italy’s textile and apparel industry, could plummet by 20% in 2020, leading to a revenue loss of €6 billion. Considering the ripple effects on the entire supply chain, the industry as a whole could suffer losses ranging from €7 to €9 billion.
Conducted from April 7 to 17, the study also revealed that 76% of the respondents were still non-operational during that time. Among those who were operational, 13% had shifted their production lines to manufacture personal protective equipment like masks. In order to safeguard jobs, nearly 95% of companies resorted to measures such as furloughs, with 65% of the respondents having more than 80% of their workforce affected.
SMI is urging the Italian government to provide assistance in terms of employment protection measures and ensuring liquidity through access to loans and appropriate fiscal policies. The association also highlights concerns about the deterioration of relationships among businesses along the supply chain, as well as the abuse of dominant positions by certain leading groups. Furthermore, bureaucratic obstacles and the cancellation of industry events and trade shows compound the challenges faced by the fashion industry.
During a video conference, Marino Vago expressed his dissatisfaction with the lack of cohesion and unity among Italy’s fashion companies and industrial districts. He emphasized the uneven distribution of value within the supply chain, which often puts textile manufacturers at a disadvantage.
Despite the arduous situation, Italian fashion groups remain optimistic and determined to push forward and overcome the current crisis. Ultimately, with government support and collective efforts, they hope to navigate the challenges and recuperate from the substantial losses they have sustained.
1. Sistema Moda Italia: The official website of Sistema Moda Italia, providing information about the association and its activities.
2. FashionNetwork.com: An online platform offering news, insights, and analysis about the fashion industry.