The price of clothing tested by Made in China and second hand

On the occasion of its “Fashion Reboot” day, organized in Paris on November 21, the French Fashion Institute, as usual, took stock of the past year for clothing. He also revealed his final projections for 2024, and his forecasts for 2025.

The year 2025 should, in the best case scenario, be marked by a 2% increase in consumption, or a fall of 2% in the most pessimistic scenario. The median scenario expects an increase of 0.2% over the year. “The sector is unable to return to its 2019 levels,” summarizes the director of the IFM Economic Observatory, Gildas Minvielle.

“The recovery which began at +8.1% in 2021 was immediately slowed down by inflation from 2022”, continues the specialist, pointing out that the current apparent stability of the figures hides a growing problem in customer reports at prices.

And these prices, the real common thread of this Fashion Reboot 2024, should increase on average next year by 0.1%, according to the IFM survey of around a hundred brands and retailers. In detail, 74% of respondents announce stability for the coming year, and 20% an increase of 0 to 5%. Conversely, 4% anticipate a decline in prices of 0 to 5%, while 2% anticipate a decline of 5 to 10%.

A welcome stabilization given that, over the first nine months of 2024, textile and clothing saw a contraction of 0.4% in its turnover in France: an increase of 1.7% in sales in line did not compensate for the 1% decline affecting physical networks. The Internet's share of fashion sales now stands at 23%, including 6% captured by the trio formed by Shein, Amazon and Temu.

Attendance down, prices up

In 2024, retailers found that on average 40% of their customers maintained their average basket size, while 36% increased it and 24% reduced it. A positive assessment tempered by another data: 58% report a decline in attendance, compared to 29% evoking an increase. The fact remains that the transformation rate is increasing for 40% of respondents, where 32% report a decline and 28% stability.

In terms of sales volumes compared to 2023, only 12% report stability. On the increase side, 27% of the panel speaks of an increase of 0 to 5%, 8% of an increase of 5 to 10%, and 6% of an acceleration greater than 10%. Conversely, 21% report a fall of 0 to 5%, 19% mention a decline of 5 to 10%, and 8% a fall greater than 10%. In the end, this gives a reported 48% drop for 41% increase.

According to IFM data, prices have on average only increased by 1% in 2024, which corresponds to the figure predicted a year ago in the same study. Excluding sales and promotions, 45% of retailers indicate that they have increased their prices. In detail, 43% report increases of 0 to 5%, and 2% report increases of 5 to 10%. Conversely, 16% of respondents lowered their prices by 0 to 10%, and 39% maintained last year's prices this year.

These developments take place in a context of inflation, of which 68% of consumers surveyed indicate that it has had an impact on their way of consuming clothing. No less than 46% have purchased less clothing over the last twelve months. Of which 27% also opted for parts less expensive than usual, compared to 19% opting for the same or higher prices than usual.

“If the price increase slows down, from 6% in 2022 to 3% in 2023, then 1% this year, that is not what consumers remember,” indicates Gildas Minvielle. “They simply look at the prices, which they generally judge to be higher than before Covid.”

Made in China and social issues

In addition to the lasting impact of inflation, the fashion industry fears that of low-cost Chinese sites. In the ranking of the most cited portals for fashion purchases, Shein is now cited by 19.9% ​​of respondents, which places it in third place behind Amazon (26.3%) and Decathlon (21.4%). His compatriot general practitioner Temu went from 21st to 17th in one year, being cited by 6.6% of the panel.

Asked about their relationship with Made in China, 40% of respondents indicated that they consume it, even if they prefer other origins. Furthermore, 27% systematically avoid clothing made in China, compared to 21% who do not pay attention to the origin. Furthermore, 10% of them buy Made in China, whose “quality seems comparable to that of other countries”, and 2% even favor this origin, considered to be of better quality than other sources.

The question of the perception of environmental issues therefore arises. Two distinct elements stand out, each mentioned by 40% of consumers: the use of toxic products for the skin, and the low wages and working conditions of workers. Also mentioned are pollution generated by production (33%), materials “generating suffering” (28%), non-recycling of end-of-life clothing (28%), pollution linked to transport (26% ) and the lack of respect for diversity by brands (16%).

In terms of brands and brands, only 8% of companies have not taken any particular action on materials in 2024. On the other hand, 65% have increased the use of labeled eco-responsible materials, 58% have used recycled materials, and 58% to have improved the traceability of their materials. In addition, 35% are turning to organic materials, and 13% are renouncing leather, fur, mohair or angora.

The opportunity blurs the notion of price

At the crossroads of the issues of price and sustainable use of products, second-hand products now account for 12% of the French clothing, footwear and leather goods market. On the business side, no less than 58% of brands and retailers now sell second-hand products themselves. That’s an increase of 10 points over one year. Furthermore, 25% of the companies consulted indicate that a second-hand activity is planned.

On the customer side, no less than 32% of consumers now systematically favor second hand, now judging that new products are “excessively” expensive. “After the multiplication of promotions and fast fashion, second hand is participating in a blurring of benchmarks regarding prices,” notes the director of the Observatory.

Only 13% have not changed their habits, believing that new and used products have comparable prices. On the other hand, more people point out that second hand offers access to better quality products or luxury brands (27%), or mix new or second-hand purchases even though the first remains more expensive (28% ).

The share of clothing, footwear and leather goods in household spending fell to 3.3% last year, compared to 3.7% two years earlier. This figure rose to 6.4% in 1995. This decline “is a constant phenomenon in periods of crisis as well as growth,” notes Gildas Minvielle. The latter points out that over thirty years the average growth in fashion spending is 0.2% per year in volume, and above all 0.3% per year in price, compared to +1.4% for all goods. “It is therefore false to say that clothing spending is declining: it is indeed their relative share in consumption that is reducing.”