LONDON, United Kingdom —For Farfetch Founder and Chief Executive José Neves, the last six months have not only been about protecting his own business from the fallout of Covid-19, but also supporting the hundreds of boutiques around the world — from China, Japan and Korea to the Middle East and Europe — that sell their goods online through the luxury marketplace.
“We've been able to support the boutiques and the brands on the platform at crucial time where online is, for many, the main channel and for some... the only channel,” Neves told BoF Editor-in-Chief Imran Amed in the latest episode of The BoF Podcast.
But as Neves explained, more challenges lie ahead for Farfetch and the global fashion industry at large.

Neves described the platform’s performance as “very solid,” and expects to see an acceleration in its second quarter. Part of this success can be attributed to the business shifting its focus to markets where consumer sentiment has started to recover, according to Neves. For example, as certain areas went under lockdown, Farfetch would ship orders from other stockpoints to limit disruption to its customer service.
In the wake of the Covid-19 outbreak, businesses have filed for bankruptcies and many have suffered severe financial losses. However, Neves said he remains “confident” that Farfetch will continue on its path to achieve profitability by 2021 — a goal it outlined last year.
The luxury industry has been bracing for what has been called “the mother of all sales,” as retailers are forced to drastically discount their surplus of spring merchandise. In certain regions, including the US, where sales are more commonplace, that discounting is already going deep. “When retailers build up inventory there is going to be an incentive to discount and when discounts are pervasive to the whole industry of course those retailers are losing competitivity and they tend to follow,” he said. “And of course we see that behaviour on the platform.”
Looking ahead, Neves believes the fashion industry will finally reckon with its wasteful and unsustainable business practises. “I do think the industry had an oversupply problem, which is an environmental problem as well," he said. “Platforms have a responsibility to… incentivise customers to shop consciously. By doing that you create an incentive for brands to be more conscious or to be totally ethical and sustainable if they can.”

 
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