The UK market for children's wear reached a value of GBP5.29bn (US$8.7bn) in 2008, according to new research out today, with prospects for the category remaining strong.

Research group Key Note said in its 'Childrenswear' report that volume sales at the younger end of the market were boosted by the rise in birth rate since the early part of the millennium.

The under-5s sector was particularly strong for character-licensed products that have potentially higher sales values, the report said.

Other trends, such as the older age of parents and smaller family sizes, have also been positive factors in increasing per capita spending on children's clothing.

However, the positive trends impacting on the children's wear market have been offset by changes in the UK clothing retail sector as a whole since the end of the 1990s, Key Note warned. 

"The rise of value retailers and the increase in the market share held by supermarkets have been marked by a reduction in price points across many products in the children's wear and general clothing market. This has promoted a focus on price rather than quality," Key Note said.

"When the economy was relatively strong, many consumers chose a mix-and-match approach, buying cheap basics and teaming them with items from higher-priced ranges. 

"However, the economic downturn put the spotlight on value retailers and supermarkets, and meant that there was little option for other retailers but to follow suit and extend their cheaper ranges," it added.

Over the period from mid-2009 to 2013, the child population (aged between 0 and 14 years) in the UK is forecast to grow by 11.3%, with the largest increase to be seen in the 0 to 4 year-old age group (15%). 

"This presents opportunities for added-value activity in areas such as character merchandising. 

"It will also benefit discount retailers and supermarkets that target these younger age groups (as older children can often be more discriminating about the source of their purchases, preferring to opt for the fashion stores)," the report said.

Key Note said that a rise in the under-10s population will be a driver to add value to the children's wear market. However, this will be balanced by the ongoing establishment of the value sector. 

"As consumer spending does begin to recover in the medium term, it is likely that consumers will continue to buy across the range of price points," it said.

"However, the upper mid-market will be a significant beneficiary."