The expansion of non-food – clothing, electrical goods, home furnishings etc – is threatening many of the most successful multiples on the British retail map: Boots, Sainsbury’s, Woolworths and WH Smith, to name but a few. Low prices combined with convenience give Tesco and Asda advantages that are difficult, if not impossible for the others to emulate.
In all, this report attempts to demonstrate that retailing remains an important and dynamic activity among consumers in the UK, a changing landscape, and a vital and continuing aspect of the national economy.
Increasing concern over levels of consumer debt, now over £1 trillion, prompted the government and the financial institutions to apply cautionary measures to moderate spending in 2004.
Despite the increasing debt levels, retail spending continues to rise in 2004, and only unemployment fears may destabilise the high levels of consumer confidence apparent in the UK at the present time.
Longer term, slowing growth within a context of low inflation and pressure on prices looks the likely outlook for retail sales. The Morrison’s/Safeway takeover will put further pressure on the food retailing environment. Both retailers are noted for their good value fresh food slant, and the combined buying power of these two huge chains will discourage hikes in the value of basic commodities such as bread and fresh vegetables. Value increases will continue to be achieved through an emphasis on convenience: takeaway food, higher quality gourmet ingredients, organic and locally-sourced produce, as well as premium snack items.
The infants wear market is calculated as sales of garments for children between the ages of 0-2 years. The values for each country are segmented into dresses, sets, pants and shorts, play clothing and nightwear.
Market value is calculated at retail selling price (RSP), and includes all taxes and levies. Any currency conversions used within this report have been calculated using constant 2004 annual average exchange rates.
With steadily declining birth rates depressing demand, combined with stiffening competition, UK infantswear retailing is expected to see only modest growth in the near future.
Lower priced baby clothing is much in demand with the discount sector experiencing significant growth of late.
Higher per capita expenditure has resulted in good sales of luxury clothing, while the phasing out of the Multi-Fibre Agreement has opened up the UK market to even more Low priced imports.
The UK infantswear market generated total revenues of $4.7 billion in 2004, representing a compound annual growth rate (CAGR) of 3.6% for the five-year period spanning 2000-2004. The sector has grown steadily year-on-year and currently accounts for 12.8% of European market share. The largest regional market lies in Germany, which generated total revenues of $8.2 billion in 2004, but it is the Central and Eastern European markets that have been grabbing the attention of infantswear manufacturers in recent years. The market in counties such as Poland and Russia has experienced massive growth in excess of 30% in 2000-2004.
Table
The UK menswear market reached a value of $12.9 billion in 2004, having grown with a compound annual growth rate (CAGR) of 3.6% in the 2000-2004 periods. This growth was stronger than that of the European market itself, leading to the UK market’s regional share increasing by 2 percentage points between 2000-2004, account
-ting for 15.5% of the regional market by the end of this period.
The leading revenue source for the UK menswear market in 2004 was the trousers sector, which accounted for 46.5% of the market’s value. In value terms this sector was worth $6 billion in 2004. The shirts sector generated the second largest revenues
in 2004, reaching a value of $4.2 billion, equivalent to 32.4% of the market’s value.
Going forward, the market is expected to continue expanding at similar growth rates.
By 2009, the market is forecast to reach a value of $15.3 billion, which equates to a
CAGR of 3.5% in the 2004-2009 periods, higher than the European market. The
European figure will be bolstered by the likes of Russia and Poland (expected to grow with CAGRs of 8.5% and 8.1%) but hindered by many of the UK’s western Counterparts, recovering from recent declines.