Home / Knowledge / News / Apparel/Garments / US apparel wholesalers witness recovery - IBIS
US apparel wholesalers witness recovery - IBIS
13
Apr '13
The economic recession has had a dismal effect on men's and boys' apparel wholesalers; however, revenue will rebound as the economy recovers.

The Great Recession had a dismal effect on the US economy, including the Men's and Boys' Apparel wholesaling industry. With decreased discretionary spending in 2008 and 2009, retailers offered deep discounts to consumers to retain sales. Due to weak downstream demand, wholesalers were left with excess inventories and slashed their own prices to move stock. In their ongoing quest to cut expenditures and sustain profit margins, powerful retailers set low prices, causing wholesalers to engage in fierce competition with each other.

“While industry revenue fell during the recession, it has been slowly recovering since 2010,” says IBISWorld industry analyst Caitlin Newsom. Steadily increasing downstream demand from men's clothing stores and department stores has contributed to limited industry growth. Per capita disposable income and consumer sentiment have been growing since 2010, bolstering downstream demand.

IBISWorld expects revenue will slightly increase at an average annual rate of 0.9% over the five years to 2013. Imports accounting for an increasing share of domestic demand for upstream manufacturers hampered industry growth. Because these imports are made with cheap labor, they cost less and so retailers prefer them. As a result, wholesalers are left with lower demand.

Due to limited growth some participants have exited the industry, unable to sustain operations in light of the declining market. The number of companies has fallen during the past five years, averaging 1.4% per year to 8,656 wholesalers by 2013. Mergers and acquisitions have been common as well. Major player VF Corporation picked up premium brands Rock and Republic and Timberland, while industry operator Phillips-Van Heusen purchased Tommy Hilfiger in early 2010.

Other operators have left the industry because of poor returns. As consumers regain confidence and purchasing power, demand for men's and boys' apparel will climb, boosting revenue 5.6% to reach $43.5 billion during 2013. According to Newsom the industry is expected to grow steadily through 2018. However, internal competition will continue and imports in the upstream manufacturing industry are also projected to increase, limiting industry revenue growth over the next five years. IBISWorld anticipates companies will continue to exit the industry through 2018, due to increased mergers and acquisitions and decreasing profit margins.

The Men's and Boys' Apparel Wholesaling industry has a low market share concentration, defined as the top four players accounting for less than 40.0% of industry revenue. This low concentration reflects the fragmented market that has a mix of small and medium participants. The highly competitive nature of this industry will continue to place pressure on participants to close operations or to merge to maintain profitability.

Over the past five years, concentration has slightly increased, from about 10.9% in 2008. This growth is primarily due to Phillips-Van Heusen's acquisition of Tommy Hilfiger in 2010, which nearly doubled its market share. Despite recent mergers and acquisitions within the industry, concentration levels are only expected to increase by a small amount over the next five years. 

IBISWorld


Must ReadView All

Textiles | On 19th Sep 2017

Karl Mayer expands service operations in Asia

Karl Mayer, a world leader in the production of warp knitting and...

Textiles | On 19th Sep 2017

Welspun bags Made in Green label by Oeko-Tex

Welspun, a leading home textiles manufacturer, has been awarded Made...

Courtesy: SGS

Textiles | On 19th Sep 2017

SGS expands testing facilities in Naucalpan, Mexico

SGS has expanded testing facilities in Naucalpan, Mexico, creating a...

Interviews View All

Jim Desai
Blaiva Fabricaa

Fashion industry likely to remain labour-intensive in coming years

Headhonchos
Indian fashion industry

Cotton consumption will keep growing in the Indian fashion industry

Giovanni Pizzamiglio, Paolo Crespi & Riccardo Robustelli
Epson, For.Tex & F.lli Robustelli

‘The percentage share of printing in the global textile market is pretty...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Kerem Durdag
Biovation II LLC

Kerem Durdag, CEO, Biovation II LLC, provides an insight into future...

Lynda Kelly
Suominen Corporation

Suominen Corporation is a manufacturer of nonwovens as roll goods for...

Madhu Jain
Madhu Jain

She grew up in the walled city of Old Delhi, completed her studies, and...

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

Anisha Chaudhari
Threads & Shirts

Threads & Shirts is a freshly-tailored concept providing men/women a...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

September 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
74.5%
No
12.8%
Skip
12.8%

Total Votes: 47

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
61.7%
No
25.5%
Skip
12.8%

Total Votes: 47

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.2%
No
6.4%
Skip
6.4%

Total Votes: 47

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
70.2%
No
10.6%
Skip
19.1%

Total Votes: 47


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search