Wednesday, January 07, 2009

Cheap Imports Claim Another Retail Victim

Cheap Chinese imports and City greed have forced another High Street casualty as fashion brand Viyella is the latest to bite the dust. Analysts are quick to blame the biting recession for the casualties but with a flood of cheap imports on the market and business models based on borrowing, it's no wonder retail firms are going bust. 

The womenswear company Viyella has become the latest long-established company to call in the administrators. Viyella, which employs about 450 people, follows hard on the heels of Adams Kids and Waterford Wedgwood pottery, not forgetting tired old Woolies.

The closures highlight too well the plight of UK manufacturing which has been decimated over the years as the New Labour government ruthlessly encouraged cheap imported goods to boost the false feel-good factor. 

Brands, once a mainstay of the UK economy, were swallowed up in obscure take-overs, as new owners simply traded off the once respected names. 

A girl can't get enough tops for sure but the amount of clothing, leisurewear, soft furnishings and household goods now on sale on the High Street is staggering. That's apart from the fierce competition from supermarkets and superstores, all chasing dwindling customers.

For years the City fat cats have reaped the profits and diversified. Now sympathetic words from directors are no comfort to the thousands who face losing their jobs as once iconic brands go to the wall.  

Any pretence of ploughing profits back into the business disappeared as time and again the brands expanded on the back of cheap imports, propped up by a borrowing binge. 

Clothing jobs were once crucial to UK manufacturing. Then, with an eye on boosting profits, they slowly switched to using slave labour in China and the Far East. With manufacturing gone it would not be long before the retail side followed.

The jobs at Viyella are the latest on what has been a bad day all around for UK retail  jobs. Marks and Spencer announced it was closing 27 stores and cutting back at head office, with the loss of 1,230 jobs and with plunging sales is Debenhams and Next next?

The Orange Party has said time and again that the key to economic revival lies in UK manufacturing. 

Sadly even with a change in political will, it would take years to rebuild a manufacturing base. And even that stands little chance of success, while shops chase the same customers with an eye on shareholders profits and simply import the same cheap tat from China, then desperately try to out compete each other. 

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