A Verdict on Farfetch/YNAP/Richemont
European Union antitrust regulators have promised to rule by the end of the week on whether Farfetch can proceed with its bid to take a stake in rival Yoox Net-a-Porter and work more closely with the latter’s current owner, Richemont. The partnership, announced in August 2022, feels like a holdover from a different time; Farfetch’s stock is down nearly 90 percent since the deal was announced, and has been hitting record lows all week. Investors clearly think Farfetch is in trouble, even if it gets the green light to take control of its biggest rival.
Birkenstock
Birkenstock’s disappointing public markets debut came as a surprise to observers in the fashion world, who have watched in awe over the last decade as the utilitarian leather sandals have become unlikely status footwear. That’s only the first chapter in the story; how the stock trades over the coming weeks and months will be just as crucial to determining whether other fashion companies pursue initial public offerings.
More Luxury Earnings
Salvatore Ferragamo and Brunello Cucinelli will likely confirm what LVMH told us last week: luxury sales are slowing down. Ferragamo was already struggling with declining sales and profitability as it tries to modernise, while Cucinelli is on a tear thanks to the quiet luxury boomlet (this week’s results will be a key indicator of whether that trend is still going). But both companies are really more of a prelude to next week, when Kering and Hermès report.
LA Fashion Week: Now Under New Management
Brands love Los Angeles, but the city’s always struggled to position itself as a true fashion capital. Attempts to build a fashion week around homegrown designers and visiting luxury labels have repeatedly flopped. N4xt, a consortium of fashion, financial and entertainment industry veterans, is the latest to give it a try. They’re up against decades of history and inertia; fashion loves to embrace new trends but can be quite conservative when it comes to how the industry itself operates. N4xt has lined up some promising emerging brands to give its event some credibility, including No Sesso, Imitation of Christ and Theophilio. The real test is whether non-LA based buyers, editors and influencers show up, and whether there’s appetite to do it all again next season.
The Middle East
A week after Hamas’ terrorist attack on Israel, the conflict appears set to intensify as Israel readies a military response in the densely populated Gaza Strip, where the United Nations is warning of a “calamitous situation” for the civilian population. Many fashion professionals are mourning the loss of life on both sides of the conflict. They are also watching for how the situation will impact the industry, the Middle East region and the world. While Dubai Fashion Week went ahead, Fashion Trust Arabia has postponed its competition and awards show. The wider economic impact depends on whether the conflict engulfs more of the region and has knock-on effects on travel and consumer sentiment, key drivers of fashion consumption.
What Else to Watch for This Week
Monday
Tech Week begins in New York — expect to hear about all things AI
Tuesday
UK reports August unemployment data
US reports September retail sales
The Salón Internacional de Alta Relojería watch fair begins in Mexico City
Wednesday
LA Fashion Week begins
UK and Eurozone report September inflation data
Thursday
Ferragamo, Cucinelli report quarterly results
Friday
Deadline for EU approval of the Farfetch/YNAP/Richemont deal
UK reports September retail sales
The Week Ahead wants to hear from you! Send tips, suggestions, complaints and compliments to brian.baskin@businessoffashion.com.