Fashion Economic Influences Economics

Fashion’s Impact on the Economy 1.3 million workers in 2005 producing more than $50 Billion in products 100,000 jobs in Georgia

How does the economy influence trends or decisions made in the fashion industry?

Objectives  Discuss how the fashion industry impacts the national economy and how outside economic factors affect the fashion industry  Define discretionary income, inflation rate and gross domestic product  Discuss the economic effects of Legislation, Labor and Piracy on the fashion industry  Identify the four pieces of information required by US apparel label laws  Differentiate between pirated goods, counterfeit goods and knockoffs

Discretionary Income:  The money left over after paying for basic living necessities such as food, shelter and clothing.

Inflation Rate  Refers to rising prices  Measures the change in price over a period of time for over 400,000 household goods.

Gross Domestic Product (GDP) The amount of goods and services produced using labor and property located in this country

Other Economic Issues Affecting Fashion and the Apparel Industry  Legislation  Labor  Piracy

Legislation  Trade Laws Tariffs Quotas

Legislation  Label Requirements – Apparel labels are required by law to have four pieces of information  Fiber Content  Country of Origin  Care Instructions  Business Name

Labor  Labor Laws Sweatshops Unions- A collaboration of workers to effect change The Triangle Fire Child Labor Laws

The Triangle Fire  March 25, 1911  10-story building  Triangle Shirt-Waist Co.  145 died (mostly women)  Exit doors blocked  Deter employee theft

The Triangle Fire Inside the factory after the fire

Piracy  Piracy: The creation of illegal copies of apparel that are sold at a lower price. May not be of the same quality as the original.  Counterfeit goods: Exact copies of items that are registered with the U.S. Patent and Trademark Office sold illegally.  Knockoffs: Copies of designer garments available at a reasonable price. These copies are not marketed or tagged as the original.

Piracy The costs of Piracy or Counterfeit goods:  The manufacturer does not get the benefit of the sale  The consumer may not get the same quality  The consumer pays a higher price for goods in order to combat piracy and make-up for lost revenue

Review  What role does the textile and apparel industry play in our economy?  What are some factors that affect the apparel and fashion industry?  What is discretionary income?  What is the inflationary rate?