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
Impact of the economic crisis
The global economic crisis started to have an impact on consumer demand in the
Turkish market in the fourth quarter of 2008. By the end of the year, some
major manufacturers ceased production and started to reduce their labour
forces in order to survive the crisis. Most retailers undertook promotions and
discount sales to offload the previous year' s stocks. Their sales through
outlet centres also experienced notable increases. The effect of the crisis
showed itself in the decline of unit prices, but its main impact is expected
to be seen during 2009, which is considered as a lost year in the industry.
Experts are hopeful that 2010 will be a brighter year, in terms of both
production and retail sales.
Development of shopping centres
The shopping centre market in Turkey has seen significant development during
2007--2008. The number of centres increased, as Istanbul led the way with 61,
while the number is expected to reach 139 by the end of 2012. While the
development of shopping centres is still focused on Istanbul, they are now
opening in other cities as well. Ankara, Izmir, Bursa and Antalya all have
significant numbers of shopping centres.
Shopping centres are now seen not only as places to buy goods but also as
places to socialise. People make their weekend plans around shopping malls,
where they can do their shopping, go to a cinema and have lunch in the same
place.
Asian products on the market
Asian products, especially those from China, found a place in both the
clothing and footwear markets. Even though Asian clothing and footwear
products are of lower quality than others, they are popular on account of
their competitive prices. Textile quotas imposed on Chinese products by the
Turkish government were abandoned in February 2009. In order to limit the
market penetration of Chinese products, the Turkish government launched a
procedure that required them to apply for certification.
Dashing retail landscape
The entry of new international brands to the Turkish market has been a key
feature of the period 2007--2008. Foreign investors' interest in the Turkish
market remains strong. Apart from the brands such as Bershka, The Gap and
Banana Republic, international luxury brands have entered the Turkish market
as well.
The trend began with the appearance of Harvey Nichols at the Kanyon Shopping
Centre in 2006, which was followed by the opening of Dolce & Gabbana, Fendi
and Yves Saint Laurent, among others, in 2007. In 2008, Berluti, Marni,
Dsquared2, Lanvin and Sergio Rossi opened their stores in Turkey' s first high
street renovation project in Akaretler, Istanbul. In order to survive in this
more competitive market, domestic players increased their focus on design,
advertising and enhancing awareness of their brands. Domestic brands started
to produce more modern designs than in previous years in order to target the
country' s young population.
Future of clothing and footwear
The textiles industry forms a major resource and plays a substantial role in
generating employment in the Turkish economy. Following the financial crisis
that hit the country at the end of 2008, the sector faced a significant
decline, especially on the production side. The Turkish government has
prepared an action plan to provide support for the textiles, ready-to-wear and
leather sectors. Manufacturers with 30 employees or more benefit from 50%
energy support, exemptions from value added tax (VAT) and customs duties,
interest rate subsidies, discounts on social security payments, etc. This
package of incentives, which is expected to support the whole of the clothing
and footwear industry in terms of production, export and domestic sales, will
be available throughout the forecast period.
Clothing and footwear are both among the last sectors to be affected by
economic crises, since they provide essential items for everyday life. Both
sectors are therefore strongly expected to recover more quickly than many
others within Turkey.
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