Growth in value clothing expenditure will slow substantially in the five year period to 2012, with limited household disposable income restricting discretionary purchases. However, 27.6% growth is a resilient performance, with the key contributors – Primark, Sainsbury's and H&M – increasing their store presence and improving ranges encouraging consumers to spend despite tight purse strings.
For the first time, from 2014, we forecast growth in value clothing expenditure to underperform the overall clothing market. A gradual shift in shopping habits of consumers making more considered purchases and wanting better value for money through quality and product design will result in a proportion of consumers trading up to midmarket players
Despite the lower costs associated with OOT, high street locations are much more desirable for attracting younger shoppers. While OOT stores remain important for catering to families, value players need to have a presence in high footfall locations to build retail brand awareness – particularly those with a high fashion offer which target 16–24s
Logistically, Europe offers more convenient expansion than in regions further afield due its closer proximity to the UK, similar seasons and westernised consumers wanting fashions similar to the UK's. European competitors would include C&A, H&M, Kiabi and TK Maxx so UK players must identify gaps in the markets to ensure successful launches.