“The high-end apparel brands are present in malls and are proven to be selling successfully. However, it is the mid-market where there has been, and continues to be, very strong demand for branded fashion. Brands that are known, fashionable, trendy and moderately priced are more successful than others. The Euromonitor study indicates the potential of fashion retailing when compared to disposable income. The study states that levels of disposable income are high in the Kingdom and have shown an increase of 12 percent between 2000 and 2004, and are forecast to increase a further 16 percent between 2004 and 2009 . “This is likely to prove a key driver of branded apparel sales, as shopping for clothes is seen as a hobby rather than as purely functional, increased disposable income can push up spending considerably . “This is illustrated by the breakdown of consumer expenditure by commodity. Clothing and footwear in Saudi accounts for 10 percent of consumer expenditure. This compares to 4.5 percent in France, six percent in Germany and the UK, and four percent in the United States . “Over the last three decades, Euromonitor has covered more than 205 countries worldwide during which their consultants conducted over a million research and survey covering demographic and economic aspects for varied markets and industries .Its key findings: Saudi Arabia is a major market for women and children’s clothing. The market is distinctly segmented between the high-end branded sector, the mid-market branded sector and the lower-priced market. The high-end and mid-market sectors of the apparel market are dominated by imports from Europe and the United States. The lower end of the market is characterized by imports from the Far East and South East Asia, some of which are styles copied from European and American brand names .Womenswear is the largest retail apparel segment in the Saudi market. In 2004, womenswear accounted for 54 percent of total branded retail sales and was considered the most mature segment of fashion retail. While Riyadh remains the largest market for womenswear, it is expected that further growth will be driven by smaller cities, mainly Dammam and Qassim. Footwear is the second largest sector after womenswear, accounting for almost 20 percent of apparel sales in 2004. Alhokair has a dominant position in the footwear sector, carrying the largest brands, including Aldo, Nine West and Nike. The footwear segment is well segmented with shops covering a range of prices, branded and unbranded merchandise .Spending on shoes is more buoyant. All indications are that sports wear and sports shoes have strong potential in the Saudi market. As well as being a large sector, footwear is a good growth sector. Sales of childrenswear (excluding footwear) are high in Saudi Arabia due to its significant young population and high birth rate. In 2004, childrenswear accounted for 15 percent of total sales, and growth is set to continue at around 20 percent between 2005 and 2009 .Menswear is an emerging segment in the Saudi fashion retail market accounting for around 6 percent of total apparel sales in 2004. Men still prefer to wear the national traditional clothing at home, at work, and in public. With the majority of the Saudi population at a young age, a shift in consumer tastes may be the catalyst for the future growth in this segment . “The study titled “Apparel Retail Market in Saudi Arabia” was commissioned by Fawaz Abdulaziz Alhokair & Company to Euromonitor, which has 30 years of experience in preparing reports and market studies. According to the study, the market share of branded apparel has witnessed a steady increase in the last decade due to changes in consumer tastes and converging global fashion trends . “Eyewear is, at present, underdeveloped in Saudi Arabia. In 2004, it accounted for around five percent of total apparel sales. It is a technical market and one that requires high initial investment in lab setups, recruitment of professional staff and staff training. As such, it can be difficult for a clothing specialist to shift easily into, but is thought to offer potential considerable rewards .Dr. Abdulmajeed Alhokair, chief executive officer, Fawaz Abdulaziz Alhokair & Company, said. “The company is well positioned to benefit from the industry growth. We currently enjoy a lion’s share and are market leader across product categories such as menswear, womenswear, childrenswear, eyewear and footwear. Our mid-market brand strategy has yielded handsome results and we’re confident of consolidating our number one position in future.” . “According to Euromonitor, the apparel retail industry is one of the most competitive and developed segments of retailing in Saudi Arabia. The apparel business grew rapidly over the last several years as people became more fashion-oriented. The young population (representing more than 45 percent of the total population in Saudi Arabia) in particular is highly influenced by global media, which makes apparel retailing very dynamic .Source: MENAFN.com .
Date:9/26/2006
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