Apparel, Footwear, & Accessories – January 2021

Businesses Expand E-Commerce, D2C Channels as Pandemic Reshapes Retail

Capstone’s January 2021 Apparel, Footwear, & Accessories Coverage Report is now available, highlighting how companies in the space have been forced to rapidly adapt their business models amid the COVID-19 pandemic, as state-mandated lockdowns restricted in-store sales and consumer spending retracted due to job losses and economic uncertainty.  The technology changes that were accelerated and the possibilities that were illuminated during this era will undoubtedly reshape much of the Retail industry going forward as winners and losers are assessed in the aftermath of the pandemic and their business models replicated.

Through our ongoing conversations with active industry players and analysis of trends during COVID-19, we have identified key industry takeaways, including:

• The rise of digitally native brands continues to disrupt the industry as the shift from brick-and-mortar to e-commerce has been intensified.
• Product category nimbleness will continue to pay off as companies adapt to evolving consumer preferences.
• Armed with $1.3 trillion in dry powder, private equity buyers are on the hunt for companies with strong brands and well-defined growth opportunities.
• In 2021, we expect M&A activity in the sector to heat up as the year progresses, driven by widespread vaccine roll-out, rising consumer confidence, and the continued reopening of the economy.