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UK clothing market to rebound in 2017

The UK clothing market is set to grow 2% next year, up from a more subdued 1% this year, according to new research from retail analyst Fung Global Retail & Technology.

It found that the market, worth £60.2bn in 2015, grew at a compound annual growth rate of 4.3% during the previous five years but saw a major slowdown in late 2015.

This year has been “exceptionally weak”, with average monthly clothing and footwear sales up 1% for the 10 months ended October 2016.

It pointed to a trend towards consumers shifting spend from retail to leisure, as well as ongoing political and macroeconomic uncertainty regarding Brexit negotiations that could dent willingness to make discretionary purchases.

Fung said it expects online sales to outperform the market, with growth of 9-10% in 2017.

For the period ended 31 July 2016, online fashion sales grew by 7.5% year-on-year, while store sales declined by 3%, according to Kantar Worldpanel.

It forecasts that pureplay clothing retailers such as Zalando, Asos, Boohoo and Amazon, and lifestyle brands and retailers such as Ted Baker and SuperGroup to continue to gain sales in the UK market, at the expense of discounters, department stores and weakly-positioned specialist apparel retailers.

M&S is the only big retailer that is expected to suffer a decline in sales in 2017, it said.

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