Study: Evolution of clothing retail in Canada, 2004 to 2015
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Total retail sales of clothing, footwear and accessories have steadily increased since 2004, reaching $41.9 billion in 2015. Women's clothing and accessories were the leading commodity group, recording $17.0 billion in sales in 2015, followed by men's clothing and accessories ($9.4 billion), footwear ($7.1 billion), and luggage and jewellery ($4.4 billion).
From 2004 to 2015, clothing and clothing accessories stores posted annual growth in 10 of 11 years. The subsector recorded its largest annual increase in 2015, with sales of clothing, footwear and accessories up $2.0 billion (+7.6%). From 2004 to 2015, sales of clothing, footwear and accessories doubled at sporting goods, hobby, book and music stores and rose 13.5% at general merchandise stores.
Sales of clothing, footwear and accessories in volume terms grew from 2004 to 2015, while consumer prices declined. According to the Consumer Price Index, consumers paid less for clothing (-12.6%) and footwear (-3.8%) in 2015 compared with 2004. However, they paid more for clothing accessories, watches and jewellery (+34.9%).
Changes in clothing market shares
In 2015, clothing and clothing accessories stores accounted for 67.0% of total clothing sales, up from 65.5% in 2004. The increase in market share was driven by gains in women's clothing and accessories, followed by men's clothing and accessories.
Sporting goods, hobby, book and music stores also increased their market share, accounting for 6.6% of clothing sales in 2015, up from 4.4% in 2004. This was the sole subsector to post a gain in the market share of girls', boys' and infants' clothing and accessories.
In contrast, the clothing market share at general merchandise stores fell from 27.5% in 2004 to 22.8% in 2015, as a result of declines in market shares for all clothing types.
According to financial estimates from the Annual Retail Trade Survey, the operating profit margin increased 1.1 percentage points for clothing and clothing accessories stores from 2012 to 2014, while it fell 3.4 percentage points for general merchandise stores. The expansion of cost-efficient fast fashion (clothing that is quick and inexpensive to produce, and sold by retailers at low prices) at clothing and clothing accessories stores contributed to the changes in the operating profit margin.
Clothing store turnover
There were numerous exits and entries in the Canadian retail sector from 2004 to 2015, with several high-end clothing retailers entering the sector and several popular middle-class stores exiting. Despite this turnover, the clothing retail industry continued to prosper.
Sales of clothing accounted for 67.5% of total sales at clothing and clothing accessories stores in 2015, down from 71.9% in 2004. With the increasing popularity of fast fashion, proportions of sales at clothing and clothing accessories stores steadily shifted to footwear (+3.4 percentage points) and luggage and jewellery (+1.0 percentage point) over the period.
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