When the Princess of Wales arrived at the industrial-chic surroundings of London’s 180 Studios earlier this month to present a fashion design award to NEWGEN fashion designer Patrick McDowell, it felt rather like the passing of a baton.
With the Queen Elizabeth II Award for Design – which recognises British designers who are leading the way in sustainable practices and making a positive impact on the environment – the Princess was promoting the future of luxury eco-conscious fashion. And what did she choose to wear to mark the occasion? Tailoring by Victoria Beckham.
Catherine’s appearance in her chic olive two-piece must have been a kick in the teeth for Stella McCartney, daughter of Sir Paul and the late Linda, whose label has been a bastion of not only British sustainable fashion but also a stalwart of Savile Row-style tailoring since the brand’s inception in 2001.
“I’m sure it didn’t go down well… That’s a space that Stella really felt she owned,” says one source close to the brand. “Her name’s been a byword for sustainable luxury and British tailoring for more than two decades. But times have changed, what was her niche is now a crowded marketplace. The thing she was reliably known for, her tailoring, has gone off the boil with bizarre proportions and crazy shapes. When you’ve got the likes of Victoria Beckham, Gabriela Hearst and Phoebe Philo all inhabiting a similar space… You need to bring something really special.”
Indeed, so far, 2025 has been something of an annus horribilis for brand Stella McCartney. In January, it was announced that minority shareholder Louis Vuitton Moet Hennessy (LVMH, the biggest luxury conglomerate in the world, who also own Celine and Dior) were selling their 49 per cent stake in the business after five years. McCartney purchased the shares back for an undisclosed sum, making the house an independent entity once again. The separation marked the second time the Stella McCartney brand has been set adrift from a group – in 2018, the brand departed from the Kering stable (owners of Gucci, amongst others) after 17 years with the shares once again bought by McCartney herself.
Moves like these leave McCartney wrestling with an upended supply chain, which needs to be rebuilt and higher costs, being that the brand no longer benefits from group discount rates on materials and services. Throw in Brexit and Covid, and it’s easy to see why all’s not well between the balance sheets either.
Accounts filed in March (almost six months after the Companies House deadline) showed sales at the house fell by almost half in 2023. Turnover was slashed from £40 million to £21.9 million, and the brand’s pre-tax loss went from £10 million to £25 million over the same period. In fact, Stella McCartney has not made a pre-tax profit since the £9 million it reported in 2017, instead accumulating a pre-tax loss of more than £143 million. Directors at the brand said this represented a “material uncertainty that may cast significant doubt on the group’s ability to continue as a going concern in the long term”.
“Sadly, since the pandemic, sustainability has taken a backseat to profits in the fashion business,” says Dana Thomas, author of Fashionopolis: The Price of Fast Fashion and the Future of Clothes and host of the pro-climate movement podcast The Green Dream.
“Maintaining your integrity can be costly – more costly than most C-suite executives and shareholders are willing to accommodate. It’s a shame, because consumers… want to patronise brands with like-minded practices. Such brands are getting harder to find in the mainstream; start-ups are the core of the sustainable fashion movement now, and they are always financially precarious, because they are still so new and unproven, and many fail.”
They say that bad news comes in threes, so perhaps, then, it’s not surprising that earlier this month, news got out that the designer was leaving her beloved flagship store on Old Bond Street, nine years before the end of the lease. Stella McCartney moved into the Grade II-listed, 18th-century townhouse in June 2018 after spending four years overseeing its renovation. The opening night was a glitzy affair, with an interior decked out in designer furniture (including a £21,000 sofa) and the likes of Kate Moss, Kylie Minogue and Idris Elba waving Union Jacks from an upstairs balcony. “Welcome to the House of Stella McCartney!” Stella told the press after cutting the shop’s big red ribbon. “I have been the architect in this process, creating this space.”
The shop had been designed “with bespoke personal experiences at its core” – a ball pit and climbing wall for kids on the ground floor and with art and sound installations throughout. Old Bond Street is “probably one of the most prestigious retail locations in the world, it’s an incredible honour for us [to be here],” The fashion designer said at the time: “This store really tells the story of the world of Stella McCartney.” And like any good story, it features the rough and the smooth – decorative rocks sourced from the McCartney family farm in Scotland and a pink faux-fur-lined lift dubbed the “Stellavator”. While the label is reportedly close to signing a new lease, they have yet to confirm where that will be (the brand did not respond to The Telegraph’s request for comment).
“Stella McCartney is known for creating traditional luxury fashion, and traditional luxury fashion is expensive, and it needs certain codes - for example, fancy stores and amazing shows,” says sustainable fashion activist Orsola de Castro. “A lot of money goes into these endeavours. A brand that also tries to be sustainable from a traditional luxury parameter has even more expenses than traditional luxury brands… So it is also not surprising that (in 2025), when brands are selling less, it would be one of the more sustainable brands that takes a hit.”
Whether these changes symbolise a temporary setback or a more permanent problem for the brand – who are reportedly racing to cut costs citing “significant pressure” from inflation on materials and salaries, plus the end of tax-free shopping in the UK, remains to be seen. Either way, it’s a huge bump in the road for a brand that has blazed a trail within the fashion industry.
“Stella McCartney was the first designer showing in Paris to question the status quo of the luxury fashion market,” wrote The Telegraph’s Lisa Armstrong in a review of her spring/summer 2025 show in Paris last September, which she declared “notably thin on ideas”.
“She made vegan (synthetic, faux leather or whatever you want to call it) bags and shoes seem desirable. She used her hugely privileged position to champion the rights of animals when the rest of the fashion world didn’t care… Through an advantageous position at LVMH, McCartney was able to invest in innovative, environmentally-friendly fabric startups and highlight their work at her shows. It doesn’t hurt that she can always attract a stellar front row to lend glamour to her cause.”
Stella has always had star power, from Kate Moss to Olivia Colman to Mary J.Blige. But, says luxury brand marketing consultant Gabriele Hackworthy, in today’s fashion marketplace, a star-studded front row alone doesn’t guarantee sales.
“In the early 2000s, the brand defined the ‘cool girl’ look with its sharp tailoring, effortless dresses, and the iconic Falabella bag…” Hackworthy notes. “While the industry has shifted and evolved, it’s a testament to [Stella McCartney’s] creative vision that she has led the brand for over two decades – impressive in an era where top fashion houses are frequently rotating creative directors.”
While Victoria Beckham may not boast such a starry front row, she is a huge star herself, living her brand, showcasing wares as diverse as a gown costing £900 to how to use her hit £30 eyeliner across both her and husband David’s Instagram feeds (followed by over 120 million people combined) offering styling tips and glimpses into their “private” world.
Indeed, Victoria Beckham’s eyeliner and fragrances have been credited by the star herself as helping her business go into profit for the first time in 15 years in 2022, with sales soaring by 52 per cent to £89 million in 2023.
“Fashion right now is deeply tied to cultural currency – and Victoria Beckham, paradoxically, has become more relevant by becoming more restrained, focused and even humble in her approach, repositioning herself from celebrity-designer to serious fashion entrepreneur…” adds Hackworthy, noting that LVMH brands (which Stella McCartney was until very recently) “thrive by anchoring collections with hero accessories – they build worlds around their bags and shoes… Without a new must-have accessory, it’s hard to build momentum. The Stella McCartney brand hasn’t had that gravitational pull in years.”
Then there are the prices. At £2000-plus, McCartney’s off-the-peg trouser suits, renowned for being many career women’s introduction to suiting, are more expensive than something similar at Victoria Beckham (£1,450). Newcomer brands such as the classic separates in Amy Powney’s new venture Akyn will also challenge in this space.
Dr Stine Hedegaard is the course leader for fashion, marketing and sustainability at London College of Fashion, UAL and an academic researcher in sustainable fashion strategy who explains that the UK luxury fashion sector faces a “complex landscape, including evolving consumer attitudes, economic challenges and likely also consumer confusion about what constitutes sustainability”.
“From a luxury consumer perspective, research indicates there is a growing, but not dominant interest in sustainability. While awareness of sustainability issues is rising, the majority of shoppers don’t prioritise sustainable brands when shopping… (sustainability) is not the primary driver for the majority of purchasing decisions in fashion, especially when compared to factors like price and quality. As such, you don’t have an advantage from a consumer perspective if you are a luxury brand positioning yourself as sustainable, unless price and quality are key factors of your product offering.”
“For a long time, Stella proved that you could run a profit-making business while being environmentally responsible,” says Dana Thomas. “She made ‘conscious fashion’ cool, and proved, for a time, that it was smart business. I hope she can right the course, and do so without sacrificing the good things she does. Fashion needs her.”
Additional reporting by Molly Gymer