Increasing Garment Prices Requiring Retailers To Up Their Games
2011 does not hold the promise of an optimistic new year for clothing retailers
, who are already struggling at unprecedented levels to match year on year sales figures amidst high levels of competition in a market place lacking consumer confidence due to recent economic fragility. In addition to financial uncertainty, they are facing the further unwelcome obstacles of at VAT increase to 20% from the current 17.5% and also an increase in the price of cotton, both of which will have to be passed on to consumers. These factors will resultantly mean up to an 8% increase in the cost of clothing to shoppers.
The price hike for one of the most important raw materials used in the rag trade is due to excessive flooding in China and Pakistan wiping out their crops and reducing the availability of cotton supplies dramatically, to such an extent that cotton exports from India have been rationed. With cotton prices at their highest premium in the past fifteen years, plus the VAT increase, it is expected by retailers that clothing prices will go up between 5% to 8% during January March 2011. On average, this may equate to approximately 1.00 per lingerie item and 10.00 per coat.
Such predictions do not bode well for retailers currently competing to offer the lowest possible prices to shoppers and bringing in to play sales promotions such as three for two, buy one get one free and offering complimentary additional items alongside purchases at dramatically reduced prices or for free.
We, at Morplan, understand the challenges facing clothing retailers during uncertain economic times and are expert at assisting our customers to employ other tactics in relation to their store layouts and displays alongside other parts of their sales strategies. We supply clothing retailers of all sizes with mannequins, carrier bags and shop fittings to do this in order to continue to entice shoppers in to their stores by appealing to them aesthetically.
by: Wilkinson Smith
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