The Debrief: Navigating the Return of Wholesale | The Business of Fashion

After a pandemic pivot to e-commerce, many brands are back to working with third-party retailers, this time, with better terms. Background: The wholesale model, while offering exposure and some upfront revenue, did not always have the best terms for vendors. Department store bankruptcies, pandemic-induced store closures and the boom in online shopping pushed brands further towards their direct-to-consumer and e-commerce businesses to drive revenue. But that’s beginning to change. As shoppers return to stores, brands are seeing value in ramping up their partnerships with multi-brand retailers — this time on better terms. “What I'm hearing across the board from both brands and retailers is that this vendor-retailer relationship is more collaborative than ever,” said BoF retail correspondent Cathaleen Chen. Key Insights: - There are multiple factors pushing brands back to wholesale. Among them, the growth of e-commerce, which has slowed after spiking in 2020, and the growing consumer appetite for curated, in-person shopping experiences that allow them to stumble upon new designers. “That discovery is still so important, and now [shoppers are] relying on a cool third-party retailer to sort of facilitate that discovery,” said Chen. - “Wholesale is very American,” noted Chen, making it an attractive vehicle for international labels looking to enter the lucrative US market. - Brands are having more of a say over how their products are marketed through retailers, like sharing