Baby Clothing Industry Trends: Impact on the Specialist Retailer

Baby clothing is an industry on the rise. Despite the demise of several ubiquitous high street brands (Adams amongst others), the UK children’s wear industry experienced 6.5% growth from 2009 to 2010 (now valued at £5.9bn) – and baby clothing was the best performing sector in that industry. How is it that the baby clothing sector can thrive when so many others are struggling to recover from the deepest recession in recent memory? Well it helps that more babies were born in the UK last year than ever before. It also helps that parents have a tendency to put their children first.

The number of births increased 1.2% last year, this equates to a significant boost in revenues. Most parents only turn to hand-me-downs once their children are a little older, preferring instead to buy new for newborns and infants.

Additionally, the average age of parents is increasing which means greater spending power. And parents do like to spend on their babies – whilst the recession hit many areas of spending, data shows parents are far more likely to cut back on themselves before their child.

The industry has also seen a shift from independent specialist retailers to supermarkets and value retailers. The increasing price of cotton, a weak pound and increasing transport costs have all driven the price of baby clothing up with many local and national stores finding themselves struggling to compete on price

The move to less expensive stores is particularly prominent amongst parents of young children. Parents of 0-3 year olds were a third more likely to do their shopping at value stores than those with children aged 3-9. Exasperating this trend is the fact that consumers are also becoming more patient. 2010 saw many parents happy to wait for sales or special offers before spending their cash – causing further disruption on retailer’s cashflow.

This isn’t great news for the specialist retailer, only a quarter of shoppers made purchases from specialist baby stores last year. This is down from a third the previous year. Unable to compete on price, the specialist retailers have been forced to find other ways to differentiate. There is a potential upside though – over half of parents describe shopping for baby clothes as an “unpleasant experience”.

2010 saw significant growth for baby clothing as a whole, but this was in spite of a decline in specialist retail. Where does this leave the specialist retailers? I think the message is clear: differentiate and find a way to make the shopping experience more pleasurable, or risk finding yourself unable to compete. Shape up or ship out I think is what they say.

Post time: 05-14-2017