Consumers purchase, on average, one pair of jeans per year

Consumers purchase, on average, one pair of jeans per year

Denim jeans are a wardrobe staple for most consumers, due to their ability to offer comfort and a long lifespan compared to other items of clothing. With many purchasing, on average, one pair per year, it has become essential for brands to capitalise on this constant trend. A new report from just-style takes a closer look. 

Denim can be made in varying degrees of thickness and quality to meet the different needs of each customer. They can also be produced relatively cheaply in emerging markets such as Asia. As such, producers are keen to capitalise on consumers' fascination with denim through constant innovation in fabric, finish and shape.

Growth
According to just-style's latest 'Global market review of denim and jeanswear - forecasts to 2020' report, the world jeans market at retail prices for 2014 is worth US$56.2bn, and is composed of 2.1bn pairs of consumer purchased jeans.

Growth, however, is happening in lower priced markets, with North America flat and Europe declining. It is Asia that is predicted to be the fastest growing world region from now to 2020.

For businesses that are based in North America or Europe, if they are not truly international, they will face difficulties, the report authors noted. Both are expected to remain tough markets for the next few years.

The growth is in Asia, and to a lesser degree, South America. But, authors point out that sourcing has got to be cost effective, because the average price points overall will decline.

Capacity
Overall, the annual consumption of denim is believed to be of the order of 3.35bn linear metres. Capacity, just-style believes, is in the order of 4.3bn linear metres.

One third of this capacity is in China, the report reveals. Well over half of this is now in Asia, proving that the old hegemony of US is completely broken, and Europe's share is fading.

Globally, there are around 500 substantial denim mills, with 300 of those believed to be in China. Around 100 are thought to be in the rest of Asia, primarily India and Pakistan.

The success of the global denim and jeanswear industry, however, will be influenced by a number of long-term trends and industry influences. These can range from commercial and geographic issues, to technology and environmental, and social and environmental issues.

Supply chain questions
The main questions, however, which the denim and jeans supply chain should ponder with concern, are whether there any serious alternatives to cotton, where in the world new weaving capacity will be installed, whether low cost countries will lose their competitive advantage, and whether there is anything new that hasn't yet been developed?

The supply chain model is changing. At present, the jeans supply chain operates primarily on two models: Retailer buys brand, which then outsources the manufacturing of the garment. Brand buys fabric; and second, retailer designs its own-label garment. Retailer buys garment directly from a manufacturer. Retailer chooses the fabric and instructs the manufacturer from where to get it.

Indeed, the supply chain is transforming into a model where parts of it "jump over" others and bypass them, the report authors noted. Manufacturers still work for brands, but, more and more, they are by-passing the brand to make directly for own label fashion retailers.

Retail itself is doing the same thing, and so the question for international retailers is whether the developing world will follow the same path. For them it could be a case of never setting up and expanding large chains of shops, but of using shops as a physical space for collecting and returning merchandise, which was bought on the net in the first place.

A safe bet
One thing is for sure, consumers are unlikely to fall out of love with denim, leaving the industry pretty secure for the long term.

Whatever happens to the various elements of the supply chain, in whatever part of the world, manufacturers and retailers will be confident consumers will continue purchasing this iconic garment. Jeans are certainly a safe bet for fibre producers, fabric weavers, garment manufacturers, brands and retailers.

Click here to view the full report.