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According to Clothing Retailing, a new Market Update from market intelligence provider Key Note, the clothing industry is forecast to increase by 4.2% in 2012, with year-on-year growth forecast to 2016. The initial growth will be largely attributable to London 2012, with the event expected to give the industry a 'boost' in sales, notably through merchandise, while the recovering economy will continue to help the industry thereafter.
This forecast is positive for the clothing retailing industry, which has been put under strain over recent years owing to the recession. The industry experienced a decline in value in 2009; however, growth has been achieved between 2010 and 2011, with the industry able to maintain similar trends to those witnessed before the economic downturn. Furthermore, changes to the price of clothing are also believed to have boosted the total market's value, as higher prices have been evident among most retailers and brands. This increase in prices is attributable to many factors, including the global hike in the cost of cotton, a rise in the price of transportation and imports and the implementation of new laws in Asia, where the cost of labour in the region has risen. All of these factors have notably affected prices, due to the high level of clothing imports distributed within the UK.
While all of these factors are believed to have benefitted the industry in terms of value, the actual number of retailers present is not experiencing the same growth. In 2012 a number of companies are facing an uncertain future, including the Peacocks group and childrenswear retailer Pumpkin Patch, while many more have reported they have also fallen into administration. While these losses will affect the industry and the high street in terms of the number of retailers, other groups are expected to gain from the administrations, while an overall boost in consumer confidence will help the industry maintain growth.
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