Challenges in UK Fashion Retail Sector and Response Strategies by Next

This report analyzes the key changes in the UK fashion clothing market and provides recommendations and strategies for Next to respond to these changes. It discusses issues such as changes in consumer preferences, sustainability, increased competition, digitalization, and trade restrictions.

Summative Assessment Individuals Project A
2500 Words Report Analyzing A Specific Retail
Sector And How A Next Might Respond To The
Issue

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Key relevant changes in UK fashion clothing market.................................................................3
Recommendation and strategies & tactics that can be used to respond to major changes...........6
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
In every sector, retailer faces several challenges or issues that affect on current as well as
further supply chain activities in effective manner. Retailer purchases product either from
wholesaler or directly from producer. From there they will offer items in small quantities or
amount to end buyers. The current study is based on Next PLC, is British international clothing,
home products and footwear retailer. This report is divided into four levels first is production of
fashion products by designers, contractors and others, second is production of raw materials,
third is principally fibers & textiles and retail sales & different forms of promotion and
advertising. This study explains issues and ways Next used to respond it.
MAIN BODY
Key relevant changes in UK fashion clothing market
Fashion industry is a particular retail sector discuss in this assignment, it is section of
business that acts as intermediary between consumers and manufacturers. This sector can be
described as procedure of purchasing clothes from maker and selling them to target market. It,
multibillion dollar international enterprise devoted to organization of selling as well as making
clothes. Fashion industry encompasses manufacturing, marketing, design, advertising, retailing
and promotion of all kinds of apparel such as children, men and women’s from the most
expensive and rarefied haute couture & designer fashion to ordinary everyday clothes from
couture ball dresses to juicy couture brand sweatpants.
After conducting analysis of fashion retail sector, it has been identified that this sector
faces several issues due to changes within market which directly impact on business growth and
success negatively (Top 10 issues or challenges facing fashion, 2020). There are some problems
discussed below;
Changes in consumers preferences-
As all organization struggle to retain and capture buyers’ attention through social
networks and same platforms, it will become imperative for fashion sector and companies
working under it to rethink their production system and find ways to overcome this issue

(Todeschini and et.al., 2017). People preferences regarding their clothing and lifestyles get
change according to trends as it affect business functions and practices. For example, when
customer’s preference is change it directly impact on production procedure which is not suitable
for business growth & success within fashion sector. Client preference is defined as subjective
tastes of individual customers, measured by their satisfaction with those goods after they
purchased them. Trends in market place get changed rapidly which affect consumer buying
behavior or purchasing decision. It creates issue for Next in fashion sector to sustain and sell
their product for longer with effective consumer base. People feel more sympathetic towards a
retailer when their clothes are promoted by celebrity they relate and admire to. New generations
of customers seek to buy designer dress that their favorite celebrity wears in specific event or TV
shows. It put high pressure on company decision making procedure. Furthermore, it can be said
that fashion sector is continuously changing which makes it complex for market players such as
retailer to stay updated with latest trends, market needs and customers.
More sustainability-
In recent time, buyers and government are more concern about sustainability that put
negative influence of retailer decision taking action while operating business in fashion sector. It
is one of the biggest issues facing by Next in fashion clothing sector. It has probably been current
problem of this modern world in term of fashion from scandals and revelations about
international brands burning their apparel (Thorisdottir and Johannsdottir, 2019). Consumer
prefer to purchase items from business who are contributing in sustainability and take one step
ahead towards environmental sustainability because it save environment and keep nature safe
from harm such as air, land and water pollution. People have again found out about demanded
and practices change that is why sustainable activities, transparent and corporate social
responsibility value chain will be a top priority for retailer in fashion sector. Government put
high pressure on fashion industry and firms working under this sector to reduce their carbon foot
print while taking step towards sustainable practices or CSR.
Many clothes are made from cotton, but at first, it has been picked then delivered all over
to be denim or sewn. Chemicals easily make their way into cotton, meaning those jeans
consumer wearing may be soaked in hazardous compounds that are not suitable for skin.

Increased competition-
Competition level within fashion retail sector affects Next business performance and
activities. Due to intense competitive degree within industry impact on production and other
functions as it create another issue for them to sell cloths and retain potential consumers. It
defined as new challenge for retailer to sustain within fashion sector for long period (Štefko and
Steffek, 2018). Next company is unable to predict which trends will become most popular in
near future, while having no guarantee of their items. Ever changing market supports to strong
and intensive competition among businesses and professionals in fashion sector. This industry is
remarkable for intense level of competitive rivalry in it. Ranges of brands are available within
sector and more are coming towards entering into it with similar goods offerings, it makes
competitive level high. Moreover, it can be defined that large number of unknown players are
expected to emerge in coming era, that also contribute in increasing competition among existing
players. In simple words, competition level affects selling and productivity of retailer rather than
before. Fashion trends come and go, according to season but competition in this industry remains
and impact for longer period. It considered as another biggest issue which require quick and
effective response.
Digitalization-
Fashion retail sector in UK have started experiencing one of the biggest and most
important issue that is technological advancement or digitalization that directly affect retailer
activities and production process (Kostka, Zhang and Shin, 2020). It considers as another change
that impact on Next Company working in this industry. As they feel more pressure from other
companies sides operating in same sector since for so long who are able to adopt latest
technologies in effective manner. Due to poor technological execution and strategy fashion
sector as well as Next Company has seen downfalls in current era that impact on retailer business
profit margin and productivity negatively. Without complying with digital and advanced
technologies success & growth in any business within retail sector is not possible. Digitalization
changes the overall business performance and functions that is not appropriate for retailer as they
face difficult situation due to this. Poor technological strategy affect consumers buying behavior
and decision making act negatively as it decrease the profit and sales of business rather than past
few years. Beyond clients shopping behavior and choices there are more issues fashion sector is

facing even at transaction level. Gap between technology and fashion, retailers and brands need a
digital mindset. Without focusing on long lasting technology and real innovation growth is not
possible. So, now it can be said that digitalization affects a lot.
Trade restriction-
One of the main issue that faced by fashion retail sector and retailer is trade restrictions
and geopolitical instabilities which affects manufacturing and trading procedure between one
nation to another (Tsui, 2016). It is inherently sensitive to politics and policies that shape cross
border trade, recent discussed are based on trade shifts between US and UK as it brought issue to
fore. Restriction and changes make boundation for retailer to do not sell their products from
another market as they have to pay high tax rate for further activities that impact on their sales
negatively. Without considering issue of tariff fee access, it is impossible for retailer to supply
items at different locations in effective manner.
Recommendation and strategies & tactics that can be used to respond to major changes
After going through the report and looking at the different issue it has been identified that
customer preference is one of the issue which is faced by the next company in the market as it
has been find out that the company is not able to make the different product as require by the
consumer in the market. To overcome the same issue some of the recommendation for Next
organization is as follows:
Awareness and gathering information: Customers have wide choice for a particular
product. There are so many competitors from where customers can purchase so all the next has
to make sure that they used to invest good amount of the resources to understand the need of
customer. As the entire retailer should have proper information about the product that are sold by
the company so that all the consumer in the market can satisfy their need. It can do by selling
products online and giving detail information about the product so they prefer our products over
competitors.
 Buying experience: To satisfy the need and preference of the customer in the market,
next in the organization has to make sure that they used to attract more and more
customers by providimg additional services to customers. Additional services include

giving customer options; provide recommendations, offering free shipping, provide
refund policy which can create superior buying experience for customer.
 After sales service: Next in the organization also has to make sure that customers are
attracted to the organisation which provides after sales service. If a company provide
warranty it ensure customer about the quality of products sell by organisation and
customer usually prefers such products only. It help organisations to retain their
customers for long period. So offering different after sales services in the market will
help the company in satisfying different preference and need of the company in the
market.
Another issue which is analysed is the Government sustainability. So for the same reason
for maintaining sustainability some of the recommendations are as follows:
Eco - smart behaviour patterns: It has been also recommended to next that they should
provide eco friendly products to customers who change their behaviour towards preferring eco -
friendly products. Government also has to make sure that they should motivates next
organization to sell eco friendly products which save our environment.
Positive development in sharing economy: Another way through which Next can
improve the consumer sustainability in the organization by developing more consumer friendly
product in the market. It will help in reduce the cost of products and provide freedom of choice
to customers. Government have also taken various steps to ensure the development of sharing
Economy. Government have analysis the legal status of users and examine the needs of
customers.
More effective eco-labelling: It is another recommendation through which government
can do the same in the nation, government has to make sure that markets and trend prevailing in
market are keep on changing rapidly .with change in trends customer preference also change and
to compact with the needs and to increase the confidence among customer organisation should
bring product which could fulfil customer needs. Government have also taken effective steps like
consulting the actors which help in knowing the upcoming measure and trends on which
organisation can make appropriate strategies.

Along with above issues, Next has to response more issues that mentioned below by
taking right and effective decision.
 In context of third issue, it has been recommended to Next that they must keep
competitive and gain competition advantages by selling products according to the
preferences and current trends in market as it help to gain attention of target as well as
new consumers towards purchasing designer dress in return it increase profit margin.
 Furthermore, they must begin to abandon their traditional role as producers and also start
selling their goods directly to end buyers because it saves time and efforts as well.
 Next must sell their clothes at very competitive prices through offline and online trading
sources that is quite beneficial for them in term of increasing profitability & sales. By
adopting both methods they can earn more rather than its competitors.
Another issues has been identified after conducting analysis of fashion sector, that affect
productivity level negatively which can be solved when company take right action.
 Next must start implementing and then experiencing with VR and marketing technologies
bringing experience to physical outlets such as digital mirrors where potential consumers
can pay from directly and get access to take picture within VR mirrors and then share it
on social media sites which is quite beneficial for Next to retain customers for longer and
permit to build trustworthy relations with them.
 They must gradually and slowly embrace technology to meet market demands and needs.
 Next should allow consumer to communicate with them and it only happen when they
use digital and advanced technologies. As it help to enhance shopping experience of
clients rather than before and increase consumer base as well in return generate revenue.
All above issues might be solved and affect on short term period but in context of trade
restriction it impact longer that is not appropriate for Next within fashion sector.
 Trade policies or rules get changed by the government of nation according to the
economic and political situation which affect on Next business activities negatively as
they are unable to sell their apparel in systematic manner to number of consumers at
another market. So, to over some this issue retailer had to make effective contribution by
following the rules and trade policies which is quite beneficial for them.

 Next firm must pay extra charges on their each trading activities according to current
trade rules because it make them able to operate their function in effective manner that is
really very important for sustaining within marketplace for longer.
CONCLUSION
From above analysis, it has been concluded that fashion retail sector in UK, facing many
issues that directly impact on Next business functions or productivity level. But by taking right
decision and appropriate response as mentioned above they can handle the situation and
effectively overcome problems.

REFERENCES
Book and Journals
Berridge, H.S., 2018. A practical look at the challenges luxury fashion brands face in the wake of
digitalization: is it time that luxury fashion brands learn to love e-commerce
platforms?. Journal of Intellectual Property Law & Practice. 13(11). pp.901-908.
Kostka, G., Zhang, X. and Shin, K., 2020. Information, technology, and digitalization in China’s
environmental governance.
Štefko, R. and Steffek, V., 2018. Key Issues in slow fashion: Current challenges and future
perspectives. Sustainability. 10(7). p.2270.
Thorisdottir, T.S. and Johannsdottir, L., 2019. Sustainability within fashion business models: A
systematic literature review. Sustainability. 11(8). p.2233.
Todeschini, B.V and et.al., 2017. Innovative and sustainable business models in the fashion
industry: Entrepreneurial drivers, opportunities, and challenges. Business
Horizons. 60(6). pp.759-770.
Tsui, C., 2016. The Evolution of the Concept of ‘Design’in PRC Chinese Academic Discourse:
A Case of Fashion Design. Journal of Design History. 29(4). pp.405-426.
Williams, D., 2019. What’s Going On? A Discourse in Fashion, Design, and
Sustainability. Fashion Practice. 11(3). pp.283-290.
Online
Top 10 issues or challenges facing fashion. 2020. [Online]. Available through: <
https://fashionunited.uk/news/fashion/top-10-challenges-facing-fashion-in-
2020/2019123046802>