Decline continues for Japanese apparel, but at a lesser rate
Clothing and apparel in Japan had a difficult year in 2011 due to the prolonged economic downturn and the decline in consumer expenditure on apparel and footwear. However, it managed to slow down the overall decline in value terms in 2011 as consumers shifted towards value for money with garments that have a lasting quality. This was especially evident after the 2011 earthquake. Furthermore, value sales were boosted by increasing unit price of garments as a result of increasing production and labour costs in China.
The introduction of the Cool Biz campaign in Japan was a significant boost to apparel sales. The governmental campaign was aimed at promoting further casual and cooler attire in response to the reduced energy supply from the 2011 earthquake disaster and subsequent aftermath. This led to a significant increase in sales of underwear and men’s outerwear, for example, shirts using functional textiles such as cool contact, sweat-absorbing, quick-drying, heat-shielding and heat insulation. The campaign was well received by office workers looking for ways to deal with hotter office conditions as companies scaled back on the amount of air conditioning used during the summer months.
Value key as economy brands lead sales
The two leading companies for apparel in Japan are Fast Retailing Co Ltd and Shimamura Co Ltd. These are established domestic firms that offer a wide variety of casual clothing options. These companies offer economic and sensibly priced brands which resonate well with Japanese consumers that value affordable and high value clothing options. These firms also offered a variety of Cool Biz clothing options which was an enormous successful trend due to Japan’s energy situation following the earthquake.
Strong growth in Internet retailing
Distribution patterns in Japanese apparel remained consistent in 2011, with mass merchandisers losing some ground to apparel specialist retailers due to the increased mass-market store openings by the specialist retailers with price competitiveness. The major story remained the growth of Internet retailing of apparel and footwear, with further gains expected over the forecast period.
Outlook negative for Japanese apparel
Apparel is expected to show a milder decline over the forecast period than seen over the review period as the earthquake concerns fade and consumers regain confidence in spending. However, in the medium-long term, there remains uncertainty over many drivers including increasing production costs, potential for income tax increases, the ageing population and lower birth rate together with slow economic recovery. These factors will put downward pressure on the market as a whole and thus will be negative in the forecast period.
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