CeeCee retail fashion case study
Industry overview
Over the last decade, the European clothing market has grown by almost 20% (as measured by sales revenue). However, this headline sales figure hides many of the underlying tensions involved when competing in this market sector. The clothing market has suffered from strong deflationary pressures due to the influx of `value’ retailers and intense competition. `Value’ retailers are defined as low price retailers which import low cost clothing manufactured principally in Asia. These `value’ retailers include some high street chains as well as supermarket chains that sell clothing. Generally, it is accepted that there are three tiers of clothing retailers, which are: couture houses and top designer labels high street retailers of fashion clothing `value’ retailers (as defined above) which retail at the inexpensive end of the market. There are a wide variety of retailers which compete in high street and shopping centres all over Europe (and some globally) whose prices, quality and branding varies greatly. Historically, clothing-only retailers dominated the market, taking nearly two thirds of all sales, with large department stores coming second. More recently large supermarket retailers, known principally for their grocery lines, have gained market share with a major push into non-food sales. Furthermore, in an increasingly competitive market, `value’ retailers are also growing quickly. The major force for change in the clothing retail market came from the `value’ retailers which began to offer clothing at extremely low prices. This sector caused traditional retailers to question all aspects of their business models. The sometimes breathtakingly low prices offered by the ‘value’ retailers changed shoppers’ attitudes. Branding and differentiation were considered to be critical for retailers operating outside the ‘value’