“See-now-buy-now” and the Changes to the Fashion Retail Industry

October 2016 | Carla Figliomeni

Earlier this year the head of French fashion’s governing body (the Fédération Française de la Couture du Prêt-à-Porter des Couturiers et des Créateurs de Mode) rejected the option being explored by the Council of Fashion Designers of America to allow fashion week runway shows to be converted into consumer events featuring runway collections that are available for purchase immediately after a show. While the French federation opted to maintain the status quo and have runway shows taking place a season before collections are sold at retail, some designers opted for the “see-now-buy-now” approach in the recent fashion season that wrapped up with fashion weeks in London, Paris, New York and Milan. Designer offerings ranged from a handful of items to the full runway collection.

The immediate availability of such collections is part of the market shift towards “instant fashion” perpetuated over the years by social media, e-commerce, “fast fashion”, and consumer demand for immediacy. The industry has changed dramatically and the shift to delivering prompt consumer products impacts all aspects of the retail industry.

With its understanding of the unique business and legal issues facing retailers, the Retail Group at Miller Thomson can help retailers navigate through the changes in the industry and can provide assistance to retailers looking to keep up with consumer demands and to adapt to this need for immediacy. The following are a few areas in which the Retail Group can provide assistance:

  • E-commerce and its changes to leases. With e-commerce presenting itself as a viable secondary retail channel, the role of “bricks and mortar” has changed. While a physical store is becoming increasingly important to a retailer’s network, the amount of sales that are identified as being made in-store has shifted. Miller Thomson can assist landlords and retailers with navigating the issues around percentage rent formulas, radius restrictions, use and operating covenants in leases and their intersection with e-commerce, show-rooming, pop-up and omni-channel sales trends.
  • Taxation of e-commerce. Tax laws and policies designed for the physical world can be difficult to apply to e-commerce that takes place in the more ethereal world of cyberspace. The taxation of e-commerce activity can include charging and remitting sales taxes and liability for corporate income tax. Miller Thomson can provide national and international retailers selling products online to Canadian consumers taxation advice to ensure a tax-efficient structure is in place, including providing an analysis of whether a “permanent establishment” is present in Canada for international tax purposes.
  • Compliance with privacy laws and regulations aimed at protecting consumers. E-commerce activity is increasingly integrated with social media, targeted and shopable advertisements, and an omni-channel presence geared at providing consumers with exactly what they are looking for. This integration enhances business and better meets customers’ needs but must be done in accordance with Canadian consumer protection and privacy legislation. In addition to other compliance matters, Miller Thomson can assist in ensuring that the information collected about consumers from various sources is compliant with regulations to protect personal information, and that the information on e-commerce websites conforms with provincial consumer protection legislation.

The Retail Group can assist national and international retailers who are thinking about new selling platforms and who are looking at ways to improve the experience for their customers.

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