Recent developments in the fashion market

Consumer demand for clothing is now more fragmented and discerning. Retailers are wary of carrying high levels of stock, major demographic changes are occurring, and many different styles and fabrics are available. These have all resulted in the mass market for clothing being fragmented and are eroding the advantages of long-run manufacture.

Previously the UK textile industry had a reputation for being dictatorial and short on choice. This was blamed on the nature of the relationship between retailers and manufacturers. Clothing retailing was dominated by a few large groups who exercised enormous power in the wholesale market for garments and fabrics. Retailers emphasized basic garments with very little fashion content, and Marks and Spencer in particular set very detailed specifications for fabrics, making-up and quality. Manufacturers such as Courtaulds and Carrington Viyella geared their production to large volumes of basic fabrics for a few major customers. It became uneconomic to deal with orders that either were small or required much design detail. Competition among retail chains was over the price and quality of garments.

Since then the market share of the multiple retailers (such as Bhs, Debenhams and Marks and Spencer) has been affected firstly by the emergence of smaller specialist chains (Benetton, Next) then grocery supermarkets ('George' at Asda and Tesco). Mintel 2005 estimates that 'George' sales in 2004 (excluding VAT) were £1.07 billion and that non-specialist retailers of this type enjoyed an increase in sales of 13% from 2003 to 2004, with this rising trend continuing. Further European retailers (Zara, H&M) have also gained market share in the UK by importing low-cost garments. To avoid competing with the abundance of low-cost imports, the big retailers have responded by increasing the speed with which they introduce fashion and style changes. This, in turn, has forced suppliers to manufacture shorter runs of garments with higher design and fashion content. In some parts of the market there has been a distinct shift in retail competition away from an emphasis on garment price to non-price factors, such as design, quality and fashion. However, this non-price competition has had only a limited success with even Marks and Spencer and its strong 'British Made' slogan, turning to importing more cheaply from overseas. Value retailers such as Matalan, Primark and TK Maxx, who have attracted the more price conscious shopper, have enjoyed considerable success in other sectors of the market (Table 2.1).

Table 2.1 UK trade in clothing (£ million), 2001-2005

2001

2002

2003

2004

2005

Imports

9 160

9 806

10 341

10 884

11543

Exports

2 592

2 506

2 713

2 729

2 679

Balance of trade

-6 568

-7 300

-7 628

-8 155

-8 864

% change year on

11.1

4.5

6.9

Source: HM Customs and Excise. © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen's Printer for Scotland).

year

Source: HM Customs and Excise. © Crown copyright material is reproduced with the permission of the Controller of HMSO (and the Queen's Printer for Scotland).

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