The Business of Fashion Podcast

Episode: The Great Fashion Reset: Can New Designers Still Build a Business?
Date: September 17, 2025
Host: Sheena Butler-Young (B), Senior Correspondent, The Business of Fashion
Guest: Joan Kennedy (C), Reporter, The Business of Fashion

Overview

This episode examines the seismic shifts within the fashion industry that are reshaping the landscape for emerging designers. Host Sheena Butler-Young and BOF reporter Joan Kennedy discuss the ways that structural changes—from the decline of department stores to investment and cultural shifts—are making it harder than ever for new fashion brands to build viable businesses. The conversation addresses challenges and bright spots, seeking to answer whether a future for new talent is still possible and what innovation and creativity mean for the industry's health.

Key Discussion Points & Insights

1. Challenging Environment for Emerging Designers

• Structural Barriers: Joan Kennedy outlines the landscape:
  • High and rising production costs, new tariffs, and risk-averse investors focused on profitability.
  • Fast fashion has led shoppers to expect low prices and accelerated the copycat problem.
  • Skyrocketing marketing costs; social media is more crowded and less effective for genuine breakout success.
  • Most significantly: "the decline of multi-brand retailers" (03:09).
• Quote:

  “First of all, we’re in a really tough market. Costs are high, getting higher. We have the new problem of tariffs to contend with. Investors generally are more cautious… and more focused on profitability and consistency.”
  — Joan Kennedy [02:05]

2. The Decline of Department Stores and Wholesale

• Historic Role:
  • Department stores used to act as incubators, offering emerging brands consistency and visibility.
  • Retailers would buy season after season, supporting slow growth and innovation.
  • Recent years have brought bankruptcies (e.g., Matches and Essence) and a pressure for immediate performance.
• Unstable Partnerships: Payment delays (e.g., Saks’ net 90 payment cycles) are especially damaging for cash-strapped small brands.
• Quote:

  “If you’re smaller, you’re not able to wait 90 days to be paid… and in this environment where payment terms vary drastically season to season… that just makes everything all the more challenging.”
  — Joan Kennedy [06:58]

3. Investors and the Demand for Immediate Success

• Short-term Focus:
  • Investors and retail partners now expect early proof of big growth, reducing their commitment to riding out ‘off-seasons.’
  • The risk-friendly ecosystem of the past has been replaced by caution.
• Market Lull’s Effect:
  • The last boom era is over for luxury and DTC brands, and a reset may be possible if the macro environment improves.

4. Fast Fashion, Copycats, and the Shrunken Runway

• Acceleration of Trends:
  • Social media virality means a signature product can be knocked off within weeks, undermining the ability to ‘own’ a moment and build a brand legacy.
  • Pressure mounts on designers to innovate constantly and compete on price, often at the cost of margin.
• Quote:

  “You now have this really reduced Runway where if something is hot or interesting on social media, you will be knocked off in a week or two.”
  — Sheena Butler-Young [08:44]

5. The Social Media Conversion Trap

• Buzz ≠ Business:
  • Viral fame doesn't always translate to sales—designers can have large, enthusiastic followings that never convert into buyers.
  • High “awareness, not much of a business” syndrome plagues new brands.
• Illustration:
  • Citing “Nancy” Dejaka (a designer): oversold on online momentum but faced the reality that online fans weren’t ready to purchase.
• Quote:

  “A lot of awareness, not much of a business, a lot of buzz, not much of a business…”
  — Joan Kennedy [10:17]

6. Pricing Problems and Customer Disconnect

• Price Elasticity:
  • Designers are forced to assess where their audiences actually are financially; the rise in luxury prices has widened the gulf.
  • Example: Aeria, a buzzy NY brand, is introducing lower-priced basics and fun dresses to connect with more fans.
• Quote:

  “…at the other end…a line of basics…just really cute basics and they have little rhinestones on them. And then, you know, more just like fun dresses at a more accessible price point.”
  — Joan Kennedy [12:33]

7. Direct-to-Consumer (DTC) and Relationship Building

• Storefront Challenges:
  • Small brands rarely generate the sales to justify physical shops; driving traffic online is also expensive.
• Resurgence of Intimacy:
  • Trunk shows and specialty boutiques are being leveraged to forge direct, meaningful consumer relationships.
  • Specialty stores can offer more tailored feedback, buyer relationship, and closer links to shoppers.
• Quote:

  “…more brands are going back to, like, the trunk shows and creating these, like, really intimate moments with their shoppers…it is, I think, a positive that people are, like, getting more intimate and, like, more focused on what sales, what their customer wants, particularly from them.”
  — Joan Kennedy [13:37]

8. Nimbleness as an Advantage

• Agility:
  • Smaller brands can adapt quicker—pivoting, scaling up or down as needed.
  • Creativity remains a unique selling point—consumers seeking something ‘special’ will pay for innovation.
• Quote:

  “You can either kind of like blow it up or like shrink in a little bit. And so you have that flexibility, which is a key advantage.”
  — Joan Kennedy [15:41]

9. The Broader Stakes for Fashion

• Why It Matters:
  • Without a thriving class of emerging talent, fashion risks stagnation. Innovation starts with new perspectives and ideas that ultimately filter up and drive the industry.
• Quote:

  “The emerging designers really bring so much interest to fashion… The industry…really needs a supply of design innovation to thrive.”
  — Joan Kennedy [19:48]

10. The Path Forward: Optimism and Focus

• Back to Basics:
  • The focus is shifting from hyper-growth to sustainable, profitable businesses closely aligned with customer needs.
  • Brands are “building on bricks rather than on clouds”—getting serious about products, customers, and margins.
• Opportunities:
  • Mid-market is ripe: well-designed, creative products at smart, non-exorbitant prices are likely the growth area.
• Quote:

  “…brands getting closer to their shoppers and understanding, like where their competitive advantages are, who they’re speaking to and being really sharp about that and growing at a pace that makes sense for them. No longer just growth at all costs.”
  — Joan Kennedy [22:28]

Notable Quotes & Memorable Moments

• “It makes you feel more pressure to, like, just keep producing and that you have to go faster…which can be a tough situation to manage.” — Joan Kennedy [09:02]
• “Slow and steady wins the race. I think we’re all correcting a little bit and slowing down, which makes sense.” — Sheena Butler-Young [21:59]
• “[Creativity is] so key… to fueling sales, to building good businesses. And so I think that is a source of optimism.” — Joan Kennedy [22:21]
• “Build on bricks rather than on clouds.” — Referenced from designer Nancy Dejaka [20:44, 22:12]

Timestamps for Important Segments

• 02:01–03:24 — The key structural shifts hurting emerging designers
• 03:24–06:58 — The decline of department stores and impact of payment practices
• 07:34–09:00 — Modern investor expectations & copycat problem
• 09:29–10:44 — The conversion gap on social media; false signals of success
• 11:18–13:03 — Pricing mismatches and strategies to bridge them (Aeria example)
• 13:28–14:52 — DTC and direct customer relationships, rise of trunk shows/boutiques
• 14:52–16:41 — Where small brands can win: nimbleness and creativity as competitive edges
• 19:24–20:27 — What's at stake for the industry if emerging talent can't thrive
• 20:40–23:40 — Outlook: How designers are getting smarter, closer to shoppers, and focusing on sustainability and profitability

Conclusion

The episode paints a sobering but nuanced picture: the odds for new designers are steeper than ever, with traditional supports fading while costs and speed pressures climb. Yet, the hosts find hope in those employing creativity, forging direct relationships, and deliberately choosing steady, sustainable growth over scale-at-any-cost. With fashion’s very relevance at stake, the path forward is persistence, innovation, and keeping customer connection at the center of every business model.