Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Executive summary
2007 Spending on Clothing Stagnates While Sales Decline in 2008
According to Fedis (Belgian Federation of Distribution) and Creamoda (Belgian
Association of the Clothing Industry) by the end of 2007, Belgian consumer
spending on clothing remained fairly stable. The share of clothing in consumer
spending remains high in Belgium despite the economic conjuncture. A survey of
Fedis reveals a decline of 5% of the turnover during the summer sales of 2008.
Moreover, at the end of the summer 2008 the turnover of the clothing and
footwear sector registers a retrenchment of 4%. In comparison with 2007, Fedis
notes a decrease of 2% in the sales of clothing and 3% for footwear.
Competition From Asia Hitting Hard Belgian Manufacturers
According to the Belgian Textile Federation, Belgian textile manufacturers can
expect lacklustre performances in the years to come. Asian manufacturers,
especially China, offer fabrics that are cheaper than those produced by
Belgian companies. As a result, domestic production is suffering and "made in
Asia" (China, Hong Kong, Taiwan) label is appearing on most of the clothing
available on the Belgian market. The system of production and distribution
being more effective in these countries, the cost of the fabrics is decreasing
and Belgian producers cannot compete with the new prices. The most important
effect of this situation is the stagnation of value sales while the volume of
sales is increasing.
Women' s Clothing Higgest Growth Rate of Market
Unsurprisingly, the sales of the sector are driven by women' s clothing.
According to the trade press, in 2006, 48% of the clothing sold the same year
was women' s clothing. This represents a steady increase of around 5% per year
since 2006. Although men' s outerwear has the same growth rate during this
period, sales of men' s clothing represents 30% of the market while children' s
clothing only account for 22%. This trend is set to continue in the forecast
period fuelled by a new type of fashion, the "BOBO style"
("bourgeois-bohême"), a style that happily mixes expensive designer clothes
with cheap private brands items from outlets such as H&M, Zara, Promod or
Mango.
Private Labels Dominate Market
In the sector of clothing, private labels are the high-street' s most important
players. Nowadays, basic apparel coming from private labels is worn by Belgian
consumers in combination with branded clothing. Brand loyalty is diminishing
and private labels such as H&M or Mango provide a variety of trendy items and
accessories that can be combined with branded clothes. Zara, the company of
the Spanish giant Inditex is one of the leaders of this trend by using the
marketing strategy called ' fast-fashion' . By designing and manufacturing all
the products in Spain, Zara is able to keep a fast pace by changing the
collection every two weeks and dispatching them as quickly outside Spain.
Private labels are definitely the high street players of tomorrow.
Financial Crisis Impacts Clothing Spend
The turnover of the sector is expected to stagnate and even go down by 2009
and 2010 due to the economic crisis. The decline was already noticeable by
summer 2008 when the organic growth of the sector contracted by 4%. Most of
Belgian' s consumers (48%) interviewed by the group City Bank, declare that in
the prospect of an economic downturn, clothing would be the first sector where
they would cut their spending. Accordingly, foreign manufacturers are able to
offer cheap textiles leading the industry of textile to register bigger volume
sales while value remains the same. According to sources quoting Unizo, the
organisation of self-employed Flemish, 2009 will be lacklustre in the sector
of clothing. Fedis confirms this trend by underlining the contraction of the
clothing market by 2% at the end of 2008 and -3% for footwear during the same
period.
| 
View Cart
