Fashion industry blues: Sector falters as it loses £750m and sales suffer deepest decline since 2009

 
Francesca Washtell
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Sales in the fashion industry have unravelled at the highest rate for more than seven years (Source: Getty)

Britain's fashion market struck a feeble pose last year, when it suffered its deepest sales decline since August 2009, according to figures from Kantar Worldpanel.

Sales fell by two per cent in the 52 weeks to 18 December compared to the year before, Kantar found, knocking nearly £750m off its total value.

In October, Kantar had already warned the fashion market was on its steepest decline for seven years, after sales declined for the fourth month in a row.

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"It's been another difficult year for British fashion as we've seen still more value driven out of the market," said Glen Tooke, consumer insight director at Kantar Worldpanel.

"A two per cent drop in sales is a serious cause for concern, particularly when you consider that the lowest point the market reached in the wake of recession was a 3.1 per cent slump in May 2009."

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There were a couple of bright spots for the industry, with online-only players posting "impressive" growth of seven per cent year-on-year and independent retailers improving their sales by 3.2 per cent.

The cold snap expected this week could be a “glimmer of hope” for the sector, Tooke said, as shoppers seek out warmer clothing.

"We’re seeing fashion retailers continue to struggle with the same issues that have dogged the market for several years now: over-buying and deep discounting," Tooke added.

These companies are stuck in a rigid, seasonal buying cycle which no longer reflects how consumers shop. Gone are the days of buying a new winter coat come rain or shine: consumers are far more flexible in their approach to shopping and many retailers have been left behind. The result is piles of leftover stock these shops then have to sell off at vastly reduced prices.

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However, Tooke added that while the collapse of BHS was a "highly symbolic blow" to high street morale, in reality its overall market performance "was actually less significant".

"Never a top ten fashion retailer, the majority of BHS's £400m in sales was reapportioned among competitors – although it was nowhere near enough to redeem a flagging performance elsewhere."

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