Department stores are losing their grip on the UK clothing market due to the increasing popularity of supermarkets and specialised retailers as a destination to purchase clothes a new report says.

The report, undertaken by retail consultancy Verdict, reveals that clothing retailers such as Next are coming up with better ranges and more competitive prices than department stores.

Department stores' share of the non-food market has plummeted from 9.8 per cent in 1999 to 8.9 per cent in 2004 the report says. Verdict predicts this share will fall even further to 8.1 per cent in the next five years.

One of the key problems faced by department stores is their inability to secure large sites when expanding, meaning that they have to open smaller stores which offer a more limited selection of merchandise.

However, two exceptions to the trend appear to be the John Lewis and Debenhams chains, which offer a wide selection of goods instead of just relying on their clothing ranges.

Verdict adds that department stores in general drive away their key middle-aged market by introducing trendy fashion concessions instead of sticking to classic clothing ranges.

55+ consumers make up the majority of department stores' clientele and spent £5.5 billion in 2004. Verdict predicts that in the next five years they will spend approximately 50 per cent more in the non-food market than those aged under 35.