Editor’s Note
This article highlights the fashion industry’s shift from general uncertainty to persistent structural challenges, as detailed in the latest “State of Fashion” report. The call for constant resilience underscores a sector adapting to a new, more demanding reality.
Uncertainty has given way to persistent challenges for fashion industry leaders. According to the latest “The State of Fashion 2026” report by McKinsey and The Business of Fashion—an annual study analyzing the transformations of this industry—constant resilience seems to be the new mantra for the textile segment.
While the word “challenge” is part of the daily vocabulary of fashion companies, leaders are not serene about the future: 46% of them anticipate a deterioration of the situation in 2026, compared to 39% last year. For 36% of the panel, North America appears to be slightly or very unpromising next year, double the figure from the 2025 study. Tariff turbulence is at the heart of the debates, as 76% of these executives state that customs duties will be the main challenge of 2026. Conversely, 25% of respondents anticipate an improvement in the sector, compared to 20% in the previous period. China is regaining favor among leaders, who are more optimistic about its evolution.
In the luxury sector, which is gradually recovering from a drop in revenue, growth through price increases seems outdated. Brands are encouraged to refocus on creativity and craftsmanship to regain buyer trust by integrating storytelling and a high-quality customer experience into products, which could further stimulate sales.
For leaders, artificial intelligence is the greatest opportunity for the fashion industry, surpassing the themes of sustainability and product differentiation. And this technology affects HR departments as much as growth strategies and consumers. Some positions will need to upskill in AI, and new roles will emerge. Alongside this optimized workforce, artificial intelligence must be at the heart of economic models—traditional economies of scale and low-cost sourcing no longer rhyme with widespread growth.
Efficiency will therefore come from the use of new technologies to boost productivity.
At the end of the chain, the customer relationship is also being rethought. Consumption is being disrupted by AI models that track price evolution and constantly boost suggestions.
explains the report. Not forgetting the product. Operating in a dynamic sector rich with future launches, smart glasses are a testament to this digital trend, with a market estimated at over $30 billion by 2030.
Two markets are particularly standing out in 2026. On one hand, the jewelry sector is expected to experience a prosperous period, driven by a growing clientele seeking investments, pleasure, and personal expression. Fashion players will thus seek to capture this segment to boost their overall sales. On the other hand, buyers want more sensoriality and well-being. This universe
A more holistic integration of this need could be one of the keys to customer loyalty.
Finally, and facing the continuous price increases in the new goods industry, the second-hand fashion market is generating ever more revenue. Brands must avoid leaving their market share to third-party sales platforms and define their own resale strategy. Further exploiting this world of pre-owned goods would allow them to consolidate their business models and improve their image.
The full “The State of Fashion 2026” report is available here.