Skyrocketing unemployment and plummeting disposable income harmed demand for apparel
New York, NY (PRWEB) May 21, 2014
The Men's Clothing Stores industry has proven particularly sensitive to economic fluctuations over the past five years. At the peak of the recession, sinking consumer sentiment, brought about by skyrocketing unemployment and a slowdown in per capita disposable income growth, limited downstream demand for apparel. However, as economic conditions continue to improve, IBISWorld expects revenue to rebound, with expected annualized growth of 2.1% to $9.6 billion during the five years to 2014, including 0.5% growth in 2014.
According to IBISWorld Industry Analyst Vanessa Giraldo, “Increasing merger and acquisition activity has also characterized the industry during the past five years, and is expected to continue in the five years to 2019.” The number of operators has remained flat, with an average annual rate of 0.0% since 2009, totaling an estimated 8,454 businesses in 2014. Industry major player PVH Corp. finished its acquisition of Tommy Hilfiger in 2010 and The Men's Wearhouse Inc. acquired previous major player Jos. A. Bank Clothiers Inc. in March of 2014. These changes, coupled with similar ones earlier in the decade, indicate a more highly concentrated industry where companies are fewer but larger. IBISWorld forecasts this trend will continue, with enterprise numbers growing over the next five years.
As the postrecessionary economic climate continues to grow and the industry continues to rebound, employment and wages are back on the rise. In an effort to help meet higher demand, employers have increased their workforce at an average annual rate of 0.7% during the five-year period to reach 58,211 employees in 2014.
The future looms somewhat brighter for industry operators, as revenue is expected to continue its upward trend during the five years to 2019. “As consumers regain purchasing power and unemployment returns to near-normal levels, discretionary spending on apparel will continue to grow,” says Giraldo. Input costs are expected to fall as a result of the rise of offshoring and importing in the upstream apparel manufacturing industry. In turn, this will allow for low-cost purchases for apparel retailers and consumers. Because clothing is an essential part of daily life, industry revenue is expected to return to even higher growth once the economy fully recovers.
For more information, visit IBISWorld’s Men's Clothing Stores in the US industry report page.
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IBISWorld industry Report Key Topics
Operators in the Men's Clothing Stores industry retail a variety of men's and boys' suits, formal wear, shirts, t-shirts, casual slacks, jeans, sport coats, blazers, sports apparel, sweaters, overcoats, raincoats and accessories. Services may also include basic alterations such as hemming, taking in or letting out seams and lengthening or shortening sleeves.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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