David Pemsel Letter June 2024 – Chair/CEO

01 June 2024

Dear BFC Community,

The general election on 4th July has come at a crucial time for the fashion industry. Government engagement is much needed for our future success. As we celebrate LFW40 and prepare for June and September editions, it is a great moment to celebrate the diversity and impact of British fashion, whilst being realistic about the challenges that face the sector. 

Globally, but particularly in the UK, market conditions remain tough for fashion businesses. Here, we are feeling the challenges of our new trading relationships with suppliers and customers in Europe and we are rebuilding our businesses after the shock of the pandemic. While promoting responsible growth, we are striving to promote British independent businesses in a global market which is experiencing a great deal of uncertainty. 

The UK fashion industry has always been underestimated and underfunded by government. Whichever party forms the next government, there is an opportunity for a refresh, and we need support to design and deliver #FashionsFuture. We are world leaders culturally and creatively and can be stronger commercially. 

The British Fashion Council, (BFC) through conversations with our network, has identified five priorities for a new government to support economic and social growth, employment and opportunity in the fashion sector: 

  1. Restore the VAT Retail Export Scheme (also known as “Tax-Free Shopping”) and reform Business Rates to boost growth in the fashion retail sector.

Tax-Free Shopping 

In Q4 of 2023, retail spending in London’s West End was down 15%, despite international visitor numbers being level with the same period in 2019. Comparatively, in France and Spain, international visitor spending has nearly tripled amongst certain nationalities since 2019. 

The UK is now the only major economy in Europe not to offer tax-free shopping to overseas visitors. This places UK fashion designers, retailers and manufacturers at a significant competitive disadvantage compared to other markets. 

Whilst HM Treasury is unwilling to look beyond their own projections on the impact of reinstating the VAT RES scheme, independent research suggests that reintroducing the scheme would, in fact, deliver additional revenue of £2.3bn, rather than represent a loss to UK Plc. 

The scheme must be restored to ensure competitive parity with neighbouring nations. 

Business Rates & Taxation 

Currently, physical and omni-channel fashion retailers face significant competitive challenges against online-only retail, which is able to operate at reduced margins and with significantly fewer employees. 

An incoming government should develop a long-term, dynamic business rate and business taxation strategy that incentivises growth and employment in brick-and-mortar retail, drives activity on the high street and deepens business engagement with local communities. 

  1. Greater trade and export investment for UK fashion designers.

The BFC is calling for greater investment in the London Fashion Week (LFW) international buyers and press programme, financial support for designers to access international market weeks and trade shows, more targeted trade missions and a strategic approach to reducing trade barriers with the European market post-Brexit.  

  1. Support our world-leading fashion education sector with a commitment to STEAM, not STEM.

A global study by the Business of Fashion in 2019 showed that 6 of the top 37 undergraduate fashion design courses and 3 of the top 16 graduate fashion design courses are in the UK. 

With the right support, the cultural and creative industries could create an additional 1 million jobs by 2030. To do this, we need to ensure that the UK remains the world leader in creative education by supporting creativity in our schools and maintaining funding for arts, design, and craft subjects in higher education. In practice, this means greater investment in Arts subjects alongside Science, Technology, Engineering and Maths. 

  1. Develop a new generation of businesses and skilled workers in the fashion sector.

The fashion industry spans design, manufacturing, retail and creative services. The UK is recognised as a crucial incubator of global fashion talent, with a network of world-leading creative academic institutions and the BFC’s NEWGEN initiative developing new creative businesses. 

We are asking for support to continue our world-leading development schemes and a commitment to work with us to develop a diverse, skilled workforce to future-proof the industry from product design to consumer engagement.  

  1. Introduce legislation to activate sustainable business practices to meet decarbonisation and net-zero targets.

With the global apparel market frequently identified as the 3rd  largest polluter in the world, the UK fashion sector is acutely aware of its impact on the environment and societies worldwide. 

The BFC and Institute of Positive Fashion stand ready to work with the government to develop a practicable regulatory framework to activate better business practices addressing sustainability concerns, harmonised with international standards and regulations in other global markets, particularly the EU. 

We will present these priorities to the main political parties as part of our central election positioning. Over the coming few days, the BFC team will develop a campaign toolkit for our community to share with local candidates in your areas. 

Our ask is that you are proactive in putting fashion front of mind for your local candidates and ask them to respond to our sector needs. Please find more information here.

The BFC mission is to champion British fashion as a creative force on the world stage. We do this by continuing to bolster our pioneering world-class programmes that unlock and elevate creative talent. Our work and success is fuelled by you, an extraordinary diverse and inspiring community of creatives, advocates, icons, experts and fans. We invite you to continue to engage with our programmes and create connections, gain insight and seek advice to build an ecosystem to supports the future of the industry. 

On behalf of the BFC Board, I want to take this opportunity to thank the BFC Community – our partners, BFC Patrons and BFC Designer Members. I also want to thank the BFC team who work tirelessly to deliver our strategy. I am sharing an overview of what is coming up below.


Very best wishes.
David Pemsel 

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