Reshoring: local supply chain production to achieve sustainability

Conversation with … Paulo VAZ, usiness Areas Director at AEP : Portuguese Business Association, Chamber of Commerce and Industry

The day after Paulo Vaz

How has the crisis affected the fashion market?

The fashion market was already under pressure before the pandemic. Thanks to the fashion competitive analysis, we’ve noticed over the last three or four years that fashion consumption has continuously decreased which indicates a very difficult situation for the future. Digitalization, sustainability and a new generation of consumers who are no longer motivated to buy, at least not in the traditional manner, have also been game changers.

Processes were already in a deep state of transformation and this crisis has accelerated this trend. Now, forecasts of decreased consumption, less disposable income and allocation of family income to other priorities will lead the fashion market to shrink even more over the next three or four years. Brands will have to adapt to this new reality. E-commerce, sustainable goods, technical textiles for health and protection, and local sourcing will certainly be the next big trends. It could be an opportunity for Europe to reindustrialize, with Portugal asserting itself as one of this movement’s leaders, in order to avoid dangerous dependence on Asian (and especially Chinese) companies.


Would you say we will try to go back to normal as quickly as possible or do you think we will need to rethink the world post-Covid-19?

We won’t get back to the old normal quickly. We will probably never go back to the old normal; we should build a new normal after this extreme crisis. As I said, a new paradigm will be created based on digitalization, reshoring (local supply chain production) and sustainability. Technical textiles will be a greater opportunity for the future and many companies will face this challenge. A new trend will emerge: technical textiles are going to integrate fashion in the same way that they inspired a revolution in sports during the last two decades. The economic recovery will slow down much more than expected and we will need to rethink the whole textile and fashion industry post-Covid-19. For the moment, it’s very difficult to predict what we’ll get in the near future but it’ll be very different from what we knew in the recent past. That’s simultaneously scary and thrilling!


What has the crisis changed for you or what have you learned personally?

Personally, I learned how fragile we are in the face of Nature and its manifestations. I also learned how fragile our interdependent economy is and how fast a pandemic situation can destroy our lifestyle and dynamics, whether we are rich or poor, “prepared” or unprepared. Once globalization can have extremely negative consequences as well as positive ones, it has to be controlled. This is a lesson for Europe to speed up the relocation of its industries, create a strategic reserve in terms of health and protection equipment and preserve it. It is also an opportunity to rebuild local supply chains to avoid dangerous external dependence. Now is the time to pass from speeches to action!