Pre-final figures for 2023: world trade of the Fashion industry declining, but with differentiated performances in terms of price ranges
An overall decline is estimated at the end of the year, but with significant increases in sales in the mid-price range (and, to a lesser extent, in the premium ranges), compared to a sharp decline in the lower ranges
Published by Marcello Antonioni. .
Premium price Slowdown Fashion Conjuncture Consumption pattern Uncertainty International marketing
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After a two-year period 2021-2022 of strong recovery from the difficulties of the pandemic year1, during 2023 the world trade of the Fashion industry2 has overall experienced a sharp slowdown, estimated at the end of the year at around 5 percentage points in euro values (-5.4% constant prices).
In 2023 world sales of fashion products in the medium/high price ranges were able to grow (even significantly)...
The resilience of global flows of premium-price segments
As highlighted in the table below, the holding of flows attributable to the highest price ranges should be noted, which - as a consequence of a growth close to 3 percentage points in euro values (+8.3% at constant prices) - have shown an improvement in their world trade shares of the Fashion industry.
These are certainly the relatively less exposed market segments to the cost of living associated with the rise of inflation in the main developed economies3.
World trade of Fashion products by Price Ranges
(shares at current prices)
| 2019 | 2020 | 2021 | 2022 | 2023E | |
| High/Medium-High ranges | 30.4% | 34.2% | 30.4% | 26.0% | 27.9% |
|---|---|---|---|---|---|
| Medium range | 27.5% | 27.8% | 27.0% | 26.6% | 30.0% |
| Low/Medium-Low ranges | 42.1% | 38.1% | 42.6% | 47.4% | 42.1% |
| TOTAL | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% |
Source: ExportPlanning - Data - Annual Trade Data, Ulisse Datamart
The significant growth in global flows in the medium price range
Year 2023 saw, above all, a significant strengthening of the role of flows in the mid-price range, which - thanks to growth close to 8 percentage points in euro values and almost 20 percent when measured at constant prices - they have come to represent 30 percent of the entire world trade in the sector (from 26.6 percent in 2022).
The strengthening of the medium price range has affected almost all sectors of the personal fashion industry: in 2023, in fact, significant increases in global flows of the medium range are expected in the bags and suitcases (+13 billion euros compared to 2022, with a doubling of values and relative share) and, to a lesser extent, outerwear (+5.4 billion euros), jewellery, watches and costume jewellery (+3.6 billion €), lenses and glasses (+2.4 billion €), perfumes and cosmetics (+2.3 billion €), clothing accessories (+2 billion €) and footwear (+1.5 billion €).
.. in the face of the marked drop in sales
in the lower price ranges.
The fall in global flows in the lowest price ranges
On the other hand, we must recognize the marked reduction in flows attributable to the lowest price ranges, which - as a consequence of a near decline to 15 percentage points in euro values - they lost over 5 points in world trade shares of the Fashion-Personal industry. These are probably the market segments most vulnerable to the high cost of living associated with the rise of inflation in the main developed economies.
The sectors that showed the greatest declines in the medium-low price segments were, above all, outerwear (-26.6 billion euros in the preliminary balance of 2023 compared to 2022), footwear (-20.5 billion euros), jewellery, watches and costume jewellery (-18.1 billion €) and underwear and hosiery (-10.6 billion €).
Conclusions
The weakening of global demand for products from the Fashion industry during 2023 has seen differentiated patterns in consumer choices, with a strong reduction in the ranges of lower prices (more exposed to the effects of the cost of living produced by the inflationary increases experienced in the main world markets), to the advantage - instead - of sales in the medium/high ranges, which in almost all sectors of the Fashion industry have experienced trends positive.
This phenomenon appears, in some ways, similar to what happened during the previous crisis (Great Lockdown) in 2020, when - in the face of an overall reduction in global demand for Fashion products (-12.5% at constant prices) - the sector's sales in the higher price segments recorded substantial stability (-0.9% at constant prices), with a significant increase in its relative share of world trade.
1) After the fall in 2020 (-12.4% at constant prices), in the following two years the world trade of the Fashion industry was able to highlight a very intense rebound, with a cumulative increase of around 33 percentage points when measured at constant prices ( net, that is, of the inflationary phenomena that have significantly characterized the supply chain [+12.2% the estimated increase in sales prices for the overall two-year period 2021-2022]).
2) For a description of the sectors included in the aggregate considered, please refer to the relevant industry profile.
3) In 2023, consumer prices in the EU area showed an average increase estimated at the end of the year at 5.6 percentage points; in the United States the increase, albeit more limited, is estimated to be in the order of +4.3% at the end of the year (source: PricePedia Forecasts).
