How Australian fashion fell to pieces | Australian fashion

Wholesaling to department stores and multi-brand boutiques was long considered an avenue to aid designers’ cash flow and manufacturing, particularly in the early stages of a business. Large orders from a department store could help a small designer reach the minimum volumes required by some factories and provide the money needed for expansion.

An order from David Jones, Myer or the online department store The Iconic once resulted in greater visibility too, with designers appearing in catalogues and advertisements. But being picked up by a bigger business with an established audience and broad reach is no longer a silver bullet. Now it’s commonplace for retailers to ask designers to financially contribute to marketing and accept returns of stock that doesn’t sell.

Generally larger, more commercial brands can afford to pay for more eyes, which leads to more customer data, which is fed into design decisions. This cycle feeds on itself, creating a kind of design-by-algorithm that means every store, brand and collection has started to look the same.

“I was very fortunate because print media picked my designs and used it for editorials,” Isogawa says. This led to retailers giving him more exposure. “I had my collections in the windows at Barneys in New York and Browns in London without any cost,” he says. “They would never imagine charging such a new talent.”

A document from The Iconic, titled “The Iconic Media Kit – Sports. Brand Partnerships”, outlines the site’s traffic and audience, as well as the fees a designer can pay to “maximise their presence” across the website, mobile app, editorial platform, email campaigns and social media.

Having a “tile” dedicated to your brand on the site homepage for one week costs between $2,500 and $6,000. A week of being featured on the mobile app costs between $6,500 and $10,000. Email marketing ranges from $5,000 and $15,500. Social media spending starts at $1,000 and the upper range is limitless.

“These opt-in partnership opportunities complement the editorial content of our marketing channels,” says Gayle Burchell, The Iconic’s chief commercial and sustainability officer. “Our business model has been designed to enable brands and designers flexible and scalable ways to connect with our collective [2.2 million active] customers.”

The Iconic is not alone in operating this way and, while standard online advertising rates fluctuate, its prices are competitive with advertising directly on a platform such as Instagram.

Iacono says e-commerce platforms and department stores with the largest audiences are “essentially being a Google or a Facebook” and selling access to their customers.

“Commercialising a business and actually selling clothes is not a creativity game,” Gogos says. “It’s a money game.”

Even though the internet presents designers with challenges – Rieschieck says the complex pattern making, fabric manipulation, high-quality materials and adornment that she took pride in featuring “are difficult to appreciate online” – it is also full of opportunities.

The rolling images and videos on visual platforms including Instagram and TikTok allow designers to find and build an audience, then maintain a direct relationship with their customers. Iaconou says these skills are essential if independent designers want to survive. They “have to find their own channels and their own ways of breaking through”. Engaging and selling directly to consumers “is where your margin is going to be biggest”.

In 2018 Middleton, one of the founders of Sass & Bide, launched ARTCLUB. The label is focused on “the creative process rather than building a big commercial enterprise”, she says. Whereas Sass & Bide primarily manufactured out of China, ARTCLUB clothes are made in Australia from remnant fabric. “Instead of offering new styles each season, I continue to offer popular styles, adjusting or adapting the patterns or offering them in new colours and fabrics,” she says.

While Middleton does wholesale, direct-to-consumer e-commerce is her main focus. “There is a significantly higher cost involved in producing locally,” she says, but thanks to that business structure, “we enjoy higher profits margins”.

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Since Middleton is one of the most well-respected and well-loved designers in Australia, she had a significant advantage over someone starting fresh: an audience. And, while the opportunities for young designers to build communities are real, social platforms and their ever-changing algorithms require particular talents, creativity and time. These skills can go hand in hand with designing clothes but it helps to have money to spend on a social media manager and to pour into digital advertising.

The pivot to digital isn’t the only shift Middleton reckoned with when starting over. The rising cost of raw materials and the climate crisis have changed the way she creates clothes. She says the “intricate detailing we incorporated into our designs years ago” – like that cream jacket hanging in The Turn – would “simply not be possible now – for environmental and financial reasons”.

Kit Willow, who launched KITX in 2015, 12 years after she founded Willow, says it is “a lot harder to make strong margins in fashion, compared to 20 years ago”.

“The quality and weight of silk is not where it was … and the resistance to make with superb finishes and quality has certainly increased.” It simply costs much more to get clothing made, she says.

For garment workers in China, where 41% of the world’s textiles are produced, this is a good thing, Iacono says. “There was a period where labour costs were going up 20% per year in China, because their government was really levelling up and making sure that workers were being paid the right wage.”

“China became very, very sophisticated in the last … 15 years.”

There are other hubs for designers looking to manufacture offshore but they can come with trade-offs in cost, quality, ethics, transparency and ease of doing business. For a small brand with small orders, it can be hard to grapple with just one of these things.

Even the largest and most established players are suffering. Australia’s prestige department store, David Jones, was bought by a private equity fund for just $100m at the end of 2022, a steep plummet from its 2014 purchase price of $2.1bn.

Despite the difficulties, Australian fashion retains some bright spots. After entering voluntary administration in 2020 and being rescued by a private equity firm, the swimwear brand Seafolly is up for sale again and this time it is flaunting far rosier figures. Emerging swimwear brands including Peony and Form and Fold have also picked up prestigious international retailers. It should not be surprising there is an international audience coming to Australia for garments – like beachwear – that feel distinctly Australian. Resort wear by Zimmermann and Camilla, the body confident apparel of Christopher Esber and Dion Lee, and breathable staples from Bassike continue to do well with international stockists.

Other local designers, emerging and established, have taken a survival-of-the-smallest approach and traded ambitions of scale for slowness and sustainability.

The south-west Sydney headquarters of Uturn Recycled Fashion sit on 10,000 sq m of land. The space is a necessity: each week workers sort through 150 to 200 tonnes of discarded clothing collected from drop-off bins, charity stores and direct donations. In the two decades Alex Dimou has been running Uturn, he has noticed the quantity of garments dramatically increase while the quality has declined.

The wearable clothing the company collects is mostly sold at UTurn’s five Sydney vintage stores but the really special pieces are saved for The Turn.

At The Turn, Dimou says: “The Australian designers are just flying off the shelf.”