Increasingly Wealthy Chinese Consumers Spur Growth in Clothing Stores

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As the Chinese economy develops and living standards improve, demand for fashion products is growing. The Clothing Store industry in China is expected to generate $18.26 billion in revenue in 2012. Over the past five years, revenue has been growing much faster than China’s overall GDP, at an annualized rate of 14.1%, says IBISWorld. Future trends include increased competition from well-known foreign retailers and online stores. As a result, domestic retailers will be more focused on branding and promotional activities.

IBISWorld Market Research

IBISWorld Market Research

The key bases of competition for clothing stores will be store environment and product quality.

Growth in the Clothing Store industry in China was strong in the past decade due to the opening of the market in accordance with China's World Trade Organization commitments. After 2001, foreign capital streamed in, bringing with it experienced management and systems. And as the Chinese economy developed, living standards improved and demand for fashion products grew. The industry is expected to generate $18.26 billion in revenue in 2012, says IBISWorld. Over the past five years, revenue has been growing much faster than China’s overall GDP, at an annualized rate of 14.1%.

Competition among retailers is increasing due to the entry of more foreign players like Inditex, Esprit and H&M and a large increase in the number of domestic firms. Prominent foreign retailers with experienced management teams have distinct market advantages, which compels domestic players to streamline their operational processes and improve their own brand names with original designs and promotional activities. The key bases of competition over the next five years will be store environment and product quality. External competition also comes from online clothing retailers, such as VANCL, which have lower intermediate costs and are able to offer lower final prices.

Market share concentration within the Clothing Store industry is low but increasing, as major players like Metersbonwe and Bestseller Fashion, which owns Jack & Jones, Vero Moda, and Selected stores, are focusing on branded franchising to expand sales coverage and market share. IBISWorld anticipates that small retailers will lose customers or be forced to join franchised chains to stay in the industry.

For more information, visit IBISWorld’s Clothing Stores in China industry report page.

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IBISWorld industry Report Key Topics

The Clothing Store industry is part of the retail sector in China. Operators in this industry retail clothing for men, women, and children, as well as clothing accessories such as scarves, socks, belts and ties. The major sites for retailing operations are clothing specialty stores, franchised stores, and independent outlets.

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About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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Gavin Smith
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