By 2014, jeans will genuinely be a global fashion statement according to a new report from just-style, and the challenge for both brands and retail private labels will be to hold down a truly international market position.

In its 'Global market review of the denim and jeanswear industries - forecasts to 2014 (2008 edition),' just-style estimates that the denim and jeans market around the world will increase from US$51.6bn to US$56.2bn between 2007 and 2014.

This is a rise of US$4.6bn, which is 8.9% over the seven-year period, equivalent to a cumulative growth of 1.25% per year. In the face of historic price deflation, this is pretty good.

The market in units will increase from 1.784bn to 1.990bn. This is a rise of 206m units of jeans, 11.5% over the seven-year period. Volume growth exceeds value growth by 30%.

Consumption per person will rise very slightly from 0.27 jeans per person per year to 0.28 jeans per person per year between 2007 and 2014. Static and aging populations in Western Europe and Japan are forecast to be counterbalanced by growth in consumption per person in developing countries.

However, unit retail prices will fall from US$28.92 to US$28.23, driven downwards both by low-cost country sourcing and the shift to marketing in developing countries.

Key market drivers
The research, which is the third edition of just-style's global report on denim and jeanswear, looks at key drivers of the market, supply chain strategic alliances, and branding and investments.

By 2014, the report estimates, the developed world will have 81% of the retail value market (compared with 86% in 2004) and 13% of the population.

The rest of the world will have 19% of the retail value market (this was 14% in 2004) and 87% of the population.

In most apparel merchandise groups, brands have been losing out to retail own-labels - but in denim jeans, that seems not to be the case. Brand kudos matters. But is it top-end, upper aspirational, street or budget?

The report points out that classic or top fashion brands can still be sold through an exclusive retail network of department stores and boutiques; upper brands are now being forced to invest in their own retail outlets; and middle and lower brands are losing out to own-label merchandise.

However, it also acknowledges that the large unit volumes are inevitably at the lower price points, and that these are now the preserve of discount and budget own-label merchandise.

No fewer than 50% of jeans unit sales are calculated to be below US$20.

Strategic alliances
Strategic alliances between companies in the developed world and denim and jeans suppliers from developing countries are now the major form of investment in the sector.

The transformation of clothing and textile supply chains, which started as early as the 1960s, is now virtually complete.

This transformation has resulted in complex rather than simple supply chains in which jeans producers and denim weavers can supply designers, brands, retail own labels and sellers of anonymous merchandise at the same time and from the same production facilities.

The deals that are being done in the denim and jeans industry are mostly about investment in brands on a global stage and between strategic alliance partners.

The deals that involve weaving and retailing tend to be about the provision of capital. They are also impacted by various restrictions or the removal of restrictions to open trade and investment in the retailing country. Those deals that are about garment production are centred upon taking advantage of low labour costs.

Overall, the inevitable conclusion is that, although denim jeans will continue to be a staple product in the wardrobes of the developed world, the country of origin of both the denim and the garments is likely to be low cost.

Global market review of the denim and jeanswear industries - forecasts to 2014 (2008 edition)