The global fashion sector is heading into what many executives describe as a difficult year, with most expecting business conditions to worsen in 2026.
The latest BoF-McKinsey State of Fashion 2026 assessment, as reported by ANI, notes that 46 per cent of industry leaders now foresee deterioration, reflecting a shift from earlier years when uncertainty, rather than outright pessimism, was the dominant mood.
The report highlights that consumer sentiment remains the most significant threat to performance. Nearly eight in ten executives cite weak spending appetite as their primary concern.
This is closely linked to geopolitics and inflation, both of which continue to pressure household budgets. The United States is seeing particularly subdued demand, with its consumer confidence index at its lowest point since 2020.
Trade disruptions are another major source of anxiety. Around 40 per cent of respondents identify deglobalisation, tariff exposure and shifting trade policies as key risks. North America is viewed as the least promising region, with 36 per cent describing it as unpromising or very unpromising.
Growth is expected to remain in the low single digits in 2026, weighed down by volatile macroeconomic forces. As operational costs rise, nearly three-quarters of companies plan to increase prices, with 45 per cent of North American firms considering hikes exceeding 5 per cent.
At the same time, executives are placing greater emphasis on efficiency rather than outright expansion. While sales growth remains a priority for 69 per cent of leaders, this marks a decline from 73 per cent the year before.
Scaling artificial intelligence is viewed as the most important opportunity for the coming year, as noted by ANI.
Companies are now aiming to embed AI across design, supply chain and commercial operations. Sustainability, circular models and brand differentiation also feature prominently, with mid-tier brands expected to maintain stronger momentum than luxury labels.
