Womenswear Retailing in the UK
Report description
2012 is on course to be another difficult year for womenswear retailing in the UK, though inflation will keep the sales trend positive with the market forecast to grow by 3.0%. Volumes will remain in negative territory until Q3 when they gradually start to recover. Margin pressure continues to be a key issue for players, with rising costs and high levels of discounting impacting profitability
- Provides data and insight on the market size, sales and growth rates for the UK womenswear sector, overall and at category level
- Analyses how margins will be put under pressure in 2012 and what can be done to protect profitability
- The key issues in the market are examined; the economy, margin pressures, multichannel, space expansion, discounting, and opportunities for success
- Womenswear volumes, expenditure and inflation are forecast to 2015, aiding future planning and strategising
After three years of decline, we forecast that womenswear volumes will recover in the second half of 2012. Volumes fell by 1.9% in 2011, the worst for more than 20 years, as consumers have simply been unable to afford purchases in high volumes due to inflation making items more expensive
Multichannel developments and high levels of discounting are among the factors we expect to drive the market, but growth in consumer expenditure will be hindered by low consumer confidence, limited disposable income and a more subdued value clothing market
We expect the two largest womenswear players M&S and Arcadia to have lost share in 2011 and to lose more in 2012, as the competition gets tougher and consumers make far more considered purchases. We predict that H&M and Primark will make the greatest gains in 2012 with their product offers and pricing structures resonating well with shoppers
- What margin pressures will there be in 2012, and what can I do to offset these?
- Should I be rolling out new space in an effort to drive sales, even though my space productivity is struggling to improve?
- Will the level of markdown continue in 2012 and what else can I do to drive footfall?
- What manufacturing benefits does the UK offer and should I consider it as an alternative supply base?
Table of contents
•Key findings
Womenswear expenditure to grow 3.0% in 2012 …
… as volumes return to positive territory after three years of decline;
Inflation stays present driving spend per head;
Lower margins in prospect for another year due to markdowns;
Squeezed margins will lead to alternative sourcing;
Womenswear players rethink space expansion;
Retail brands achieve multichannel seamlessness;
Arcadia and M&S lose share.
•Main conclusions
Protecting margin imperative strategy in 2012
WOMENSWEAR MARKET
•Market definition and analysis
Market drivers and inhibitors
•Clothing market spending trends
Inflation drives expenditure in 2012
Clothing market sales
•Womenswear in context of clothing market
Growth in expenditure slows in the second half of the decade despite higher inflation
•Spending trends in womenswear
Shopping attitudes shift in 2011 and 2012
Inflation continues to put pressure on margins
The pressures of inflation
Dealing with price increases …
•Low volumes force retailers to discount – leading to further pressure on margins
Retailers aim to drive footfall through markdown
•Space expansion impacts space productivity – affecting profitability
(Untitled sub-section)
Sales vs space growth
•Online reduces the need for significant growth in space
Online should be a more cost efficient channel
MARKET SHARE ANALYSIS
•Clothing market share methodology
•Clothing market shares
•Womenswear market shares
Arcadia and M&S lose out to Primark and H&M
Two biggest players lose out
John Lewis contributes to department store share growth
Opportunities slow for value players
•Winners and losers
H&M gains the most share
WOMENSWEAR OPPORTUNITIES
•Protecting profitability will be vital in 2012
Alternative sourcing
Markdowns should be proactive
Footfall drivers – not just promotional activity
Extend own label proposition
Store portfolio rationalisation
Allocate space to third party brands
Multichannel
APPENDIX
•Definitions
Current prices
Inflation
Constant prices
Total growth
Volume growth
•Further reading
•Ask the analyst
•Verdict consulting
•Disclaimer
TABLES
•Table: Womenswear market definition 2012
•Table: Summary of clothing sectors 2012e
•Table: Clothing sales and y-o-y changes 2002–12e
•Table: Womenswear sales breakdown and trends in context of clothing 2002–12e
•Table: Womenswear market value and growth drivers 2002–12e
•Table: Womenswear market inflation/deflation 2007–12e
•Table: Clothing market shares for specialists 2007–12e
•Table: Clothing market shares for non-specialists 2007–12e
•Table: Womenswear market shares 2007–12e
FIGURES
•Figure: Drivers and inhibitors of the womenswear market in 2012
•Figure: Sector shares of the clothing market 2002 and 2012e
•Figure: Womenswear market trends 2012
•Figure: Womenswear expenditure at constant 2007 prices 2000–11 and forecast to 2015
•Figure: Womenswear inflation/deflation, volume and value growth 2002–12e
•Figure: Womenswear spend per head 2008–11 and forecast to 2015
•Figure: Spend per head on total womenswear, outerwear and underwear 2002 and 2012e
•Figure: Cost of cotton Jan 2010 – Nov 2011
•Figure: Change in cotton prices % and womenswear deflation/inflation 2006–11e
•Figure: Best of British, John Lewis 2011
•Figure: Womenswear sub brands 2011
•Figure: Retailers promotional activity in the run up to Christmas 2011
•Figure: UK sales growth vs space growth 2010/11e
•Figure: Womenswear sales densities 2009/10e and 2010/11e
•Figure: Womenswear retailers operating margins % 2005/06 and 2010/11
•Figure: Retailers est space growth, sales density and operating margins 2010/11
•Figure: House of Fraser click & collect store 2011
•Figure: eBay's pop up shop 2011
•Figure: Womenswear market shares 2012e vs 2007
•Figure: Womenswear Top 11 – clothing market share winners & losers 2012e on 2011
•Figure: Womenswear Top 11 – womenswear winners and losers 2012e on 2011
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