• Survey shows industry confidence still at a low ebb
  • Respondents say it will be years before full Brexit implications are understood
  • Currency, price and trade concerns top list of biggest challenges facing industry
Chief concerns highlighted in the just-style survey include volatile exchange rates following sterlings post-Brexit slump

Chief concerns highlighted in the just-style survey include volatile exchange rates following sterling's post-Brexit slump

Confidence in the global apparel industry remains at a low level following the UK's decision to leave the European Union (EU), the latest survey from just-style shows.

The poll, conducted after just-style's initial survey in July, shows only a slight easing in industry concerns – and increasing uncertainty about Brexit's full implications.

Some 47.7% of those who took part in the most recent survey said their confidence in the industry's short-term prospects had fallen over the past three months, compared to a figure of 47.3% in July. However, 9.1% said their confidence was 'significantly' reduced, marking an improvement on the 14.5% who felt this way in July.

The picture was similar in terms of medium- to long-term confidence: 36.8% of respondents to the October survey said this had fallen, versus 39.6% in July. While 13.8% reported significantly reduced confidence, versus a figure of 13.1% in July.

On both measures, most of the remaining respondents reported no change in confidence levels; only 10.2% reported increased short-term confidence (up from 7.2% in July), and 12.6% voiced improved confidence in the industry's longer-term prospects (8.3% in July).

In July, 79.0% of people believed it would take at least two years before Brexit's full implications were understood; in October, that figure was almost flat at 77.0%, with 23.0% predicting it will take five years or more.

Asked to assess the major challenges and opportunities following the Brexit vote, chief concerns centred on volatile exchange rates following sterling's post-Brexit slump.

Currency volatility and its impact on prices, along with uncertainty over future trade and import duty arrangements and the possibility of increased cross-border bureaucracy and restricted substance compliance were cited as the biggest post-Brexit challenges facing the global apparel industry.

But, on the brighter side, respondents highlighted opportunities such as potential new UK trade deals with emerging markets.

While several respondents highlighted the likely positive benefit to exports from the falling pound, many others voiced concerns about its impact on the cost of imports, as well as on input costs on raw materials from overseas.

Others say the currency fluctuation is already impacting the prices paid to garment and textile manufacturers – with some facing spot price deduction requests for future orders, as well as shipped orders – and that medium scale operators may go out of business.

"The biggest challenges are currency fluctuations; a lack of clarity about the UK's trading position with the rest of Europe, leading to a lack of confidence from consumers and investors; uncertainty over which EU laws will be removed from the statute. Opportunities won't be evident until after Brexit negotiations have been concluded," wrote one respondent.

Another believes increased pressure on prices will prove beneficial for low-cost manufacturing countries like Bangladesh, and that both buyers and suppliers "will try to reshuffle their business to adjust the price loss due to currency fluctuation through wastage reduction, efficiency building and controlled profitability."

One respondent wrote: "The world wants to trade with the UK. The countries in the Far East do not want to any of their workers becoming redundant. They will not allow the EU to dictate who and where they can trade. They talk about the UK looking inward, but it is the EU that is inward looking and protectionist."

And one final word: "I really think that Brexit will have no impact on the global apparel industry. Why should it? Maybe prices in the UK will go up in the short to medium term because of the fall in the pound. Maybe that will cause a slight fall in demand. But the UK is tiny piece of global demand. UK apparel trade with the EU is also not significant. UK brands operating outside the UK will continue as before."