On Thursday, Great Britain voted in a referendum to leave the European Union. Ever since the outcome of the referendum, the British pound plunged sharply in value against other currencies. The British currency experienced the largest fall against the dollar in history. But what does the Brexit mean for British fashion houses and shoppers?
For designer brands
Before the start of the referendum many fashion designers showed their concern about a possible Brexit. Vivienne Westwood for example posted a photo of herself wearing a T-shirt urging everyone to register to vote on her Instagram. Furthermore Christopher Bailey, creative director of Burberry signed a letter published on the opinion page of The Times of London stating “Britain will be stronger, safer and better off remaining a member of the EU”.
These concerns did not came out of nowhere as the departure from the E.U. could create many challenges for their businesses. Leaving the E.U. means the end of free trade. Many fashion houses, like Burberry, buy fabrics in Italy and produce clothing in Europe. With a weaker pound and higher import and export costs, production prices will increase heavily.
These extra costs will ultimately be passed on to the consumer, so to you! But it will take some time before these prices will be adjusted. For now, if you do not have a bank account that is measured in pounds, it might be quite the money savvy idea to schedule a shopping spree in London. As the decline of the pounds results in different exchange rate, you might be able to save money on your new Chanel bag.