Stop trade war or, at least, postpone payment deadlines. In addition, foster cash credit to guarantee companies’ solvency. In the USA, they are shutting stores and firms in compliance with federal regulations, issued in order to contain the widespread Coronavirus outbreak. Yet, in the meantime, cash flows are still, whereas expenses (for rent and work staff, for example) are still current. All of a sudden, US fashion discovers its vulnerability. That is why, in order to withstand Coronavirus impact, the most important fashion brands have sent a joint letter to US Department of the Treasury. Meanwhile, the Senate has approved a number of measures supporting, among others, unemployment insurance and sick leave, which apply to some specific classes of employees.
Withstanding Coronavirus impact
“In the fashion industry, many stores are restricting their activity to abide by rules issued by federal administration. On the one hand, we acknowledge that such endeavour is essential to contain Coronavirus outbreak; yet, on the other hand, we are concerned about the effects following a long-lasting shutdown period”. FDRA (footwear), AAFA (apparel and accessories) and CFDA (brands and designers) are the cosignatories of the letter sent to the Treasury. Effects, they continued in the text, subsequently reported by Footwear News, “can be disastrous to companies and their employees, especially to family-run small enterprises. Such situation will have knock-on consequences across the whole industry, from design to logistics, up to manufacturing. Four million people work in the fashion industry. If they do not provide companies with any aid, they will be compelled to make a few long-term decisions, which might turn recovery even more complicated”.
Customs duties
According to Matt Priest, Chief Executive Officer of FDRA, the trade war between the United States and China caused US footwear industry to bear overwhelmed costs. That is why he is loudly calling, once again, for the cancellation of customs duties imposed on imports, or at least, their suspension. “If US government is not willing to provide us with such supporting relief – he remarked –, we kindly ask them to postpone payment deadlines until 90 days. Since stores shut down and sales go up in smoke at once, government must promptly take immediate action. It is high time they were taking action now”.
Read also:
