The values of the worldwide fashion business

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The values of the worldwide fashion business

Brandon Gaille Fashion BloggerFashion Blogger Brandon Gaille has made some reflections on the worldwide fashion business and he came up with some interesting findings TextileFuture wants to make known among our readers, because it provides an interesting perspective of the worldwide fashion business

“Everyone in some way thinks about fashion from time to time. When you are deciding what to wear on any given day, you are thinking about what fashion you wish to represent. By understanding personal fashion demographics, it becomes possible to understand other personal preferences for marketing purposes as well.

Fashion is a USD 1.2 trillion global industry, of which USD 250 billion originates annually from the United States.

Fashion provides more than a positive personal impact. It is an industry, which employs nearly two million people every year. It is also an industry, which suffers a tremendous trade gap for US consumers because of the lower costs of labour that can be found around the world. The US exports about USD 6 billion in apparel each year, but imports more than USD 82 billion.

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Fashion from a Global Perspective

  • About 75% of the people who are garment workers in the fashion industry worldwide are women.
  • Up to 75 million people are employed by the fashion industry globally right now. In 2000, only 20 million people were believed to be employed by the industry.
  • In the US, cotton pickers make an average of USD 40000 per year. In India, the average employee makes USD 730 per year. In Uzbekistan, workers may not earn anything at all.
  • In 2004, it was estimated that the informal economy within the fashion industry generated 35 % of global GDP; the figure is likely higher now.
  • 6.9 million women in the US alone shop for apparel online on a regular basis.
  • 58 % of women who do shop for apparel online around the world are in the 25-45 age demographic.

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Few industries can truly say that they are global in nature, but the fashion industry is one of them. Although a majority of the manufacturing occurs outside of the US and Europe while a majority of sales occur inside the US and Europe, economies everywhere are able to benefit from what this industry contributes. Whether there is ethnic, cultural, or national fashion trends that are emphasised, there is always a niche available for designers, manufacturers, and retailers. Although the US often dominates the fashion industry in terms of imports and influence, there really is something for every demographic if you are willing to look hard enough.

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What fashion looks like in the United States

  • 36 % of fashion imports to the United States originate from China. Another 11 % comes from Vietnam and both Bangladesh and Indonesia contribute 6% each.
  • Despite rhetoric, which states otherwise, just 5% of fashion imports to the US originate from Mexico.
  • 30 % of the manufacturing jobs which are available in New York City are due to the fashion industry.
  • In Los Angeles, just under 20% of the manufacturing firms conducting daily business are in the fashion industry.
  • The number of people working as fashion designers in the United States has grown by over 50 percent in the past 10 years to over 17000.
  • Across all industries, fashion designers earn an average of USD 73600 annually in the US.
  • Apparel manufacturing on its own employs more than 144000 workers who earn a median HHI (Herfindahl-Hirschman Index – it is calculated by squaring the market share of each firm competing in a market, and then summing the resulting numbers) of USD 59750.
  • Fabric and apparel patternmakers earn an average HHI of USD 53800.
  • The majority of fashion and apparel jobs are in the retail sector, with nearly 1.5 million individuals employed throughout the country in retail establishments.
  • In Nashville, Tennessee, more than 275 fashion designers earn an average of USD 30 an hour, close to the prevailing wages for designers in New York and Los Angeles.
  • More than 200 schools across the country offer fashion-related programs and prepare students for high-wage jobs in the fashion industry.
  • Five percent of fashion designers worked in the motion picture and video industries in the last year.
  • US teens spend 40 % of their available money on items made available from the fashion industry.
  • Men, women and children’s apparel increased by 4 %, 3 %, and 6 % respectively. Stores owned by fashion manufacturers saw the highest growth rates, however, at 15 %.

As you can see, fashion is more than just what you decide to add to your wardrobe. It is an industry, which provides manufacturing jobs, accounting jobs, and even entry-level retail jobs so that everyone has a chance to get involved. Specialist positions, like an accountant, earn an average HHI of USD 83000. When there are skills involved, then people can earn an income in the US that is at or above the average annual HHI and that helps to grow economies, provide for the needs families have, and contribute to the growth of other industries.

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How much is spent on fashion every year around the world?

  • In the US, the average household spends about USD 1700 per year on fashion items, including apparel, footwear, and related accessories.
  • The average number of garments purchased in a given year per person: 64.
  • In the UK, there is an estimated USD 46 billion worth of fashion items that remain unworn in household closets across the country.
  • Even in Tucson, AZ where the least amount is spent on apparel per household in the US, more than USD 130 is spent every month.
  • China’s textile industry processes more than 41 million tons of fibre for the fashion industry every year, which accounts for more than half of the world’s total production each year.
  • The average fashion week in one of the global hubs for this industry typically generates a minimum of USD 20 million for the local economy.
  • Louis Vuitton is the top revenue generating brand in the fashion industry, with more than USD 37 billion in total annual revenues. That is 2x higher than H&M, which is its nearest competitor.

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Many times, we often purchase apparel and other fashion items without thinking about what we are doing. At other times, such as for a wedding or a job interview, we purchase specific fashion items so that we can accomplish our personal goals. As income levels continue to rise, especially within the USD 100000 + demographics, you will find that the latest trends in fashion will target these high income earners more aggressively with new styles and innovative technologies, no matter what other demographics may also be in play.

Fashion from an Islamic perspective

  • Muslims generate more than USD 224 billion in clothing and footwear sales on an annual basis, which accounts for more than 10% of global expenditures.
  • By 2018, countries like Iran, Egypt, Qatar, and Iraq are all expected to see more than 55 % growth in the fashion industry by 2018.
  • OIC exports total USD 59 billion, which is 9.5 % of the global clothing exports which occur annually.
  • At USD 24.9 billion, Turkey is the top consumption market for Muslim clothing, followed by Iran, Indonesia, Egypt, and Saudi Arabia, which are all above USD 15 billion annually.
  • By 2018, this specific demographic is expected to contribute USD 322 billion in revenues to the fashion industry.

Fashion really is a global concept. We often think of fashion as being something that only occurs within our own sphere of influence or within our comfort zones, but everyone has those sphere and zones. As a global market, Muslim fashion is about 50 % of the US market in total sales, but exceeds Chinese purchases on the average year and is 2x greater than the revenues generated in countries like Germany and Japan. Ignoring the Muslim demographic in the fashion industry is therefore at your own risk.

The value of targeting a specific fashion demographic

  • Children’s fashion is expected to exceed USD 200 billion in total sales annually, which marks a 15 % increase in the past five years.
  • Bridalwear is a fashion market, which generates more than USD 55 billion annually.
  • Menswear is an industry, which generates more than USD 400 billion each year around the world.
  • Womenswear contributes more than USD 620 billion in sales to the fashion industry annually.
  • 40 % of the apparel which is sold in the United States has been imported from China.
  • The UK fashion industry has seen a 22 % increase in direct value increases since 2009, contributing nearly 800000 jobs to the economy.
  • Fashion represents about 2 % of the global GDP, yet 75 % of the market is concentrated in the US, Europe, China, Japan, and the United States.

Fashion becomes a priority for consumers, when other basic needs can be met, and there is money left over. No one is going to spend USD 300 on leather shoes when they need to put food on their table, pay their rent or mortgage, and have a way to get to work. Yet for this industry being a secondary priority, the total amount of sales that it achieves annually are quite impressive. If you can find the right niche within this industry, then you can become instantly competitive. That is why jobs continue to be created, often high paying, and why so many are pursuing an education in this field right now. Today is a great day to consider where you fit in with the fashion demographics.”

Brandon  Gaille is one of the top business bloggers in the world, and he has founded several multi-million dollar companies. Read Brandon’s inspiring comeback story, “From Brain Tumour to one Million Monthly Visitors.” Feel free to send Brandon a message here

www.barndongaille.com

 

   


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