Made in Germany: The Business Magazine

from the German fashion industry association, GermanFashion.DW-TV: Carolin Held joins me now from the German Fashion Association. Ms. Held, what has changed in the fashion world since the financial crisis? Are labels making money the same way they used to? ? Carolin Held: Overall, yes. We have been facing about four percent decline in 2009 and the German fashion is saying that approximately five percent increase will happen in 2010 so, after all, yes, we're making the same money. ? DW-TV: So we're making money the same way. Who has it easier today, the big chains such as H & M, Zara or the high-end names such as Escada? ? Carolin Held: In terms of sales, meeting the right collection for the right customer, all the same, but the chains have less margin to go to the retail, to go to...they earn double margin. So, all in all, they can spend more and they have more money, flexibility. ? DW-TV: Alright, so the chains are actually in a better position when it comes to making money right now. ? Carolin Held: Right. ? DW-TV: Alright, fashion is very much about production costs so I want to talk about that for a second. Germany imports about twice as much as it exports when it comes to clothing. Does this have to do with the fact that it's simply expensive to manufacture clothing here? ? Carolin Held: That is absolutely true. We're doing about three percent of the German production is done in Germany only anymore. ? DW-TV: Only three percent. ? Carolin Held: Only three percent. ? DW-TV: It's amazing then that so much is actually exported when you consider that, right. ? Carolin Held: Yeah, we have a 40 percent export as average within the German fashion industry. So, if we want to expand, it's all about growth and it's all about export. ? DW-TV: Let's talk about the feelings we get when we go shopping. Now, if I see a T-shirt on the rack for let's say three euros. Am I getting a bargain knowing that this T-shirt that was made, let's say in Thailand, was made by someone who was being underpaid? That's really what's happening, isn't it? ? Carolin Held: I hope it's not. I hope not everybody is feeling like that, but of-course there can be feelings like that. We cannot give a 100 percent guarantee that this had happened to get this price, but of-course the whole industry is trying to avoid this. We have social standards, we have a lot of new guidelines we need to respect to avoid these super, super low prices. ? DW-TV: It's a lot about feeling here. I see people, particularly women going into these boutiques spending thousands of euros on an article of clothing. I mean, it's not like a service; it's not like an item, like a machine or engineering where you're getting something really tangible for your money. With fashion, passion always wins over reason, doesn't it? ? Carolin Held: That's absolutely sure. It's all about emotion, it's about 'I have the label, I got it, I got the brand.' So this is something really important, especially for us women. ? DW-TV: I came into work today and my producer, she said, 'oh, you've got such a nice tie here. What would you say, is my tie, based on your feelings, is my tie following the trend for high fashion this year? ? Carolin Held: High fashion, no, to be honest, but it's a very, very... ? DW-TV: Too conservative? ? Carolin Held: It's a little bit too conservative for that.