Daily Links

1. LVMH Is Unlikely to Score on Rebound From Tiffany: “It may cost them several hundred millions to settle out of court,” says Mark Clyman, partner at law firm Wilk Auslander. “But they will weigh that against closing the deal at the current price.” – Read More on the Wall Street Journal

2. Zara Thinks You Can’t Work in Sweatpants Forever: As people’s social lives pick up, they are more eager to get out to splurge and dress up again. Just glance at people walking in parks and promenading along seafronts. It may be a case that with so much time spent working in sweatpants, leaving home is now an excuse to put on a floaty dress. – Read More on Bloomberg

3. MPs urge government to fix ‘throwaway’ fast-fashion trend: The government is being urged by a cross-party group of MPs to take urgent steps to fix throwaway ‘‘fast fashion’’ by supporting the development of fabrics with a lower environmental impact and boosting clothing recycling facilities. – Read More on the Guardian

4. Why Everything Is Sold Out: Since millions of Americans started spending a lot more time at home, many of them have been making very similar decisions about how to do so comfortably. That has helped create supply issues in all sorts of categories: food, cleaning products, medication, exercise equipment, outdoor gear, furniture and home decor, renovation supplies, home electronics, office supplies, loungewear, and beyond. – Read More on the Atlantic

5. Louis Vuitton’s new face shield doesn’t just protect you from COVID-19: With face masks and face shields here for the long term, designers are increasingly creating PPE that better integrates with our everyday needs and wardrobes. One such example? Louis Vuitton just announced a new luxury face shield complete with a $1,000 price tag. – Read More on Fast Co. 

6. Events in a box: Large corporations are taking a slice of the money they would have spent on elaborate events and diverting it into the humble mailer—a package that gets sent to influential people to court favor online and offline. The 2020 gift box goes beyond pre-pandemic corporate swag and attempts to shrink what would have been a multimillion-dollar live experience into an easily delivered package—one that will ideally elicit an “unboxing” performance on social media. – Read More on the Wall Street Journal

1. Forever 21’s Bankrupt Shell May Stiff Creditors of $200 Million: The U.S. Department of Justice’s bankruptcy watchdog is urging the judge overseeing the shell company’s case to convert it to a Chapter 7 liquidation from a Chapter 11 reorganization, estimating that high-ranking creditors owed some $250 million will likely only get 17% of that money back, or less than $50 million, according to court papers. – Read More on Bloomberg

2. Fewer retailers are seeking US IPOs in 2020. Those that do are raising less amid coronavirus pandemic: A total of seven retail companies have gone public in 2020 during the coronavirus pandemic as of Sept. 4, raising $987.78 million in gross proceeds. In comparison, 10 retailers fetched a combined $3.13 billion in their public debuts during the same period in 2019. – Read More on S&P Global

3. B Corps May Be Fashion’s Next A-list: While B Corps haven’t long carried cachet for brands, interest in the designation is ramping up as sustainability becomes fashion’s “It” item.  “We saw a 60 percent increase in B Corp. certifications from 2018 to 2019, and we’re expecting that to be even larger in 2020.” – Read More on WWD

4. U.S. Retail Spending Grew at Slower Pace in August: U.S. consumers increased retail spending in August for the fourth straight month but at a slower pace than earlier in the summer as the economy tried to recover with the coronavirus pandemic still under way. Clothing purchases rose 2.9 percent, while furniture spending increased 2.1 percent from July. – Read More on the Wall Street Journal

5. Why Retailers are battling over business interruption insurance: When Century 21 filed for bankruptcy last week, the New York City-based department store chain blamed its demise on failing to receive payouts from its business interruption insurance. International chains like Ralph Lauren, as well as popular local clothing brands like Oaklandish, have gone to court, claiming that their insurance providers are not paying out what their businesses are owed under their business interruption policies. – Read More on Modern Retail

1. Smaller Watches Show China’s Growing Hold on Luxury Industry: Luxury good makers are retooling themselves to suit Chinese tastes. This process is being accelerated by the Asian nation’s rebound as the rest of the world still reels from the economic devastation of the coronavirus pandemic. “China, for the first time in the history of the brand, will become our No.1 country this year,” said Jean-Marc Pontroué, CEO of Panerai, a unit of Swiss luxury group Richemont. – Read More on Bloomberg

2. Fashion conversations grow louder on social as consumers return to work and school: Business fashion, nail polish and male fashion advice are just three of the interest areas on Reddit that saw huge spikes last week. Despite altered work and school schedules across the globe, people are now pulling themselves – and their outfits – together. “There has been a dramatic shift,” says Reddit’s head of partner insights and research, Dan Gould. “Conversations have moved from dressing up a Zoom background to actually dressing up.”Read More on the Drum

3. The rise of fractional ownership in luxury assets: During the pandemic, a niche investment avenue whereby individuals buy a portion of a luxury assets, such as a painting or a vintage car, has enjoyed a spike in popularity. – Read More on European CEO

4. RELATED READ: Are Birkin Bags Really a Better Investment than Stocks and Gold? One Company is Actively Testing That Theory. Rally is letting consumers invest in rare assets, including certain hard-to-get Hermès Birkin bags, in much the same way as they can buy stock in publicly-traded companies. – Read More on TFL

5. Sales of Luxury Goods in China to End the Year Above 2019: Players with a distinctive premium fashion offering will do better than others. For example, Louis Vuitton’s biggest store in Shanghai is hitting a record-high $22 million monthly sales in August. At the same time, “Brands with a clear point of view, including those putting sustainability at the forefront of their brands and communications, are driving consumer affinity and performing well.”Read More on Yahoo

6. Case in point: Prada says China sales to date well above 2019 levels. CEO Patrizio Bertelli said the appetite of Chinese customers for luxury goods remained very strong despite the coronavirus pandemic. – Read More on CNBC

1. How Has the Pandemic Changed Your Spending Habits? “’Fast fashion’ clothing from the likes of Zara and H&M will no longer be my go-to picks. I’ve realized that a closet full of clothing is useless. Instead, I plan to invest more in a high-quality, capsule wardrobe – one that’s heavy on the tops. Spending more on individual items today can mean saving more money in the long run.” – Read More on Bloomberg

2. Deals Are Being Dropped as Buyers Turn Wary During the Pandemic: U.S. companies this year have canceled 82 deals through Wednesday, up 41% from 2019. Material adverse clauses are a core ingredient in merger agreements and permit buyers to back out of a transaction in case of an event that harms the target company before closing. In some cases, deal makers now exclude the pandemic from what counts as a material adverse event to prevent a buyer from citing Covid-19 as a reason to terminate the transaction. – Read More on the Wall Street Journal

3. RELATED READA Key Concept in the Age of COVID-19 Dealmaking: The “Material Adverse Effect” Clause. One component of these evaluations will certainly be whether a public health crisis, such as COVID-19, is sufficient to trigger a material adverse effect clause and permit a buyer to terminate a transaction in anticipation of deterioration of the target’s business and financial performance due to the pandemic. – Read More on TFL

4. DTC brands are rethinking their ‘never-go-on-sale’ rule: While some direct-to-consumer startups have reported that their online sales have tripled or doubled since the start of the pandemic, not every retail company is benefitting from the e-commerce gold rush, and as a result, some are doing something they swore they never would before: offer a sale. – Read More on Modern Retail

5. On the Eve of New York Fashion Week, What’s Next? “There will probably be a separation between the brands that are really well-funded and use those shows as an amazing marketing moment and theater, and smaller brands like mine, which will continue to focus on creating a connection with product through a cultural moment. And I think it’s good. It forces all brands, big and small, to get more creative about how to reach the customer.” – Read More on the New York Times

6. Name Your Brand with a Global Audience in Mind: The longer you expect the brand name to stay in global circulation, the more careful you’ll need to be with selecting a name that takes international considerations into account. Are international customers contributing a significant percentage of revenue today? Do you expect that percentage to increase in the future? If so, you’ll definitely want to consider other markets in your decision-making process. – Read More on HBR

7. How to Make Political Merch as Buzzy as a Fashion Drop: Working with designers like Prabal Gurung, Proenza Schouler and Thom Browne, the Biden/Harris campaign has created a way for voters to acquire “a piece of the campaign.” It is “a way to attract different voters,” said Meaghan Burdick, senior advisor for the Biden campaign, which worked with 19 American designers to create a collection of shirts, hoodies, hats, totes, one very stylish face mask, and more. – Read More on Harper’s Bazaar

1. Tiffany Has Other Would-Be Buyers But Doesn’t Really Need Them: “Tiffany is quite a solid company on its own with relatively low debt levels and the possibility to both weather the crisis and finance its growth,” said Jelena Sokolova, an analyst at Morningstar. “It is also one of the few established global luxury jewelry names.” – Read More on Bloomberg

2. A California Law Was Supposed to Give Uber Drivers New Protections. Instead, Comedians (and Journalists) Lost Work: When California legislators passed the high-profile labor law last year, they said it would increase protections for laborers by classifying certain freelancers as employees, instead of independent contractors, the law, known as AB-5, would make these workers eligible for health insurance, paid time off and other benefits—if their roles included tasks that are part of the normal course of a company’s business, among other requirements. – Read More on the Wall Street Journal

3. RELATED READ: What Does California’s “Gig Worker” Law Mean for the Fashion Industry? While most fashion brands maintain staffs of traditionally-classified employees, many brands “lean on freelancers to get products designed, made, and sold. Many brands and companies bring in freelancers in a permalance scenario,” essentially treating these individuals “as employees but without benefits, or job security.” – Read More on TFL

4. The World’s Most Esteemed Fashion Houses Now Have Workshops That Will Repair Your Stuff: “We like to think that this is a sort of lifetime guarantee for our clients,” Cucinelli says. While the service has been available for decades, he says the past few years have seen notable growth. In 2019, the company estimates it performed 5,000 repairs for its global clientele. – Read More on Robb Report

5. Le Drian within his rights to intervene in LVMH-Tiffany deal: French Finance Minister Bruno Le Maire said Foreign Minister Jean-Yves Le Drian was within his rights to intervene in LVMH’s plans to back out of a takeover of U.S. jeweller Tiffany. Others are slamming LVMH for “hiding behind the French government” in an attempt to potentially “see if they can get Tiffany at a lower price.” – Read More on Reuters

6. The luxury sector is going to be hard hit for years, says former LVMH exec: The lack of global tourism is “the biggest issue which doesn’t get talked about enough as a huge portion of luxury, especially in the U.S. and in Europe,” Brown explains. “The tourism industry has decimated [it]. The Tiffany flagship on 57th Street alone accounted for 10% of their total global sales, and you know that store is closed.” – Read More on Yahoo