Premium retailers responsible for 'greatest growth' in clothing market

Value growth in the UK clothing sector will be just 2.4 per cent this year, the survey found. Volume growth is at its lowest for nine years.

Mid-market clothing retailers are suffering as shoppers’ spending shifts towards niche and premium retailers, it said.

The value sector of the£35.6 billion UK clothing market has been driving growth over the past decade forcing prices down and volumes up, said Verdict. Shoppers have become more discerning in their purchases as they face choice saturation and shrinking disposable incomes.

As a result, spending has shifted towards niche and premium retailers, which according to Verdict are “responsible collectively for the greatest growth in the market”.

In 2003, the value sector commanded a 20.9 per cent share of the£19.4 billion womenswear market. This year it has grown to 24.6 per cent. The mid-market segment accounted for 45.7 per cent share of the womenswear market in 2008, a fall from 56.9 per cent five years ago. However, the premium and niche segment has grown£2.1 billion since 2003 to command a 29.7 per cent share – up from 22.2 per cent in 2003.

Verdict lead retail analyst Maureen Hinton said: “With shoppers having less to spend and becoming more selective in what they buy, clothing retailers will have to stand out from the crowd to win market share and it is retailers in the largest segment of the market – the middle – that are losing out.”

The low cost, low price, high volume trend of the past decade is being replaced as cost inflation leads to higher prices. Verdict highlighted niche retailers including Fat Face, Ted Baker, All Saints, Joules, Boden and Howies as beneficiaries.

Between 2008 and 2013, Verdict forecast the average five-year growth rate in UK clothing will be just 3.2 per cent in value terms and 2.9 per cent in volume terms. This compares with 3.8 per cent in value terms and 6.7 per cent in volume terms between 2002 and 2007.