Forecasts suggest that COVID-19 will wipe off US$297bn from the global apparel market in 2020, a 15.2 percent decline on 2019. The US (largest apparel market) will account for 42 percent of all lost spend, which will contribute to more major chains filing for Chapter 11 over the next few months.
APAC markets, on the other hand, are expected to be in a better position to counter the COVID-19 impact compared to their American and European counterparts driven by the growth in domestic demand. We expect the developing APAC markets including China, India and South Korea to increase their position in the Top 10 global apparel markets by 2023, as mature Western markets lose out. China is expected to pip the US as the largest apparel market by 2023, says GlobalData, a leading data and analytics company.
The 10 worst impacted markets, in terms of value, will represent 85.0 percent of this total loss with mature markets suffering the hardest.
Vijay Bhupathiraju, Retail Analyst at GlobalData, comments: “Though the recovery has already started across the APAC markets, apparel sales will take some time to rebound amid dampened consumer confidence, the slump in tourism, the threat of an impending global recession and high unemployment rates.
“However, some of the lost sales will be compensated by the level of ‘revenge buying’ (sudden release of pent up demand from those willing and able to spend). Some brands across China for instance are seeing store sales return to 80-100 percent of pre-COVID-19 trading levels as the country relaxes lockdown measures.”