Global Perspective: Analysis On The Development And Trend Of Global Pandemic Textile And Clothing Retail Market

On March 11, 2020, the World Health Organization officially announced the new epidemic situation of global pandemic. Since then, countries around the world embarked on a two-year struggle against the new coronavirus. As of March 21, 2022, there are more than 470 million confirmed cases of new coronal pneumonia in the world. The virus has not been effectively curbed in the global scope. It is still difficult to completely stop the spread of the epidemic in the world in a short time. During the two years of coexistence with the epidemic situation, the world political and economic pattern and development have been impacted unprecedentedly, and the global major textile and clothing retail markets have also experienced ups and downs.

In order to understand the development of major global textile and garment retail markets and look forward to the future development trend of each major market, the Secretariat of China textile international production capacity cooperation enterprise alliance sorted and analyzed the development track of textile and clothing retail in the United States, European Union, Japan and domestic markets in the past two years, hoping to provide information and reference for international development and cooperation of industry enterprises.

The United States: ups and downs, strong recovery

Looking back over the past two years, the epidemic prevention and control measures of countries around the world have been constantly adjusted and changed. With the changes of the epidemic situation, policies such as home isolation and social distance have been intermittently changed. After the "ice age" at the beginning of the epidemic, commodity retail in major markets in the world has recovered slowly, but the development is extremely unbalanced. The U.S. retail market has recovered strongly with the help of many parties, and has experienced 24 months of ups and downs.

"Two pronged" stimulus policy

Help us stabilize domestic retail market quickly

The continuous spread of new crown pneumonia has brought unprecedented pressure on the U.S. economy. In order to stabilize the development, the U.S. government has adopted a variety of response measures and a number of rounds of economic stimulus plans. The monetary policy and fiscal policy are "two pronged" to effectively stabilize the market. In 2020, the U.S. retail market experienced a great decline. By the end of the year, the total sales volume of the whole year increased slightly by 0.6% compared with that in 2019, which was basically the same as before the epidemic.

In 2021, the U.S. economy will continue to improve. In March of that year, the new president signed and entered into force a $1.9 trillion economic stimulus bill, which includes about $1 trillion of direct subsidies (including subsidies and unemployment insurance) for American individuals and families, which plays a significant role in accelerating the recovery of the national retail market. In 2021, the total retail sales of the United States will be close to $7.42 trillion, with a year-on-year increase of 19.3%, even far exceeding the pre epidemic level (US $6.19 trillion, 2019). The sharp increase of consumption in the United States has also stimulated the development of its domestic economy. According to the data of the Bureau of economic analysis, the annual GDP growth rate of the United States in 2021 is 5.7%, which is the best performance in recent years, and the total GDP also reaches 22.99 trillion US dollars.

The epidemic has led to a stable retail market in the United States

Suffer the biggest decline in history

Before the epidemic, clothing as a non necessity accounted for 2-2.5% of personal consumption expenditure in the United States. After the outbreak of the epidemic, consumers are more cautious about the consumption of clothing products, and the recovery and development of clothing consumption market has experienced a long time cycle. According to the data released by the Bureau of economic analysis, the proportion of clothing products in personal consumption expenditure in the United States will drop to 1.99% in 2020, and it will fall below 2% for the first time in recent ten years.

From the monthly data, the U.S. retail market, especially the retail of clothing products, has experienced a historic slump. Since March 2020, the United States began to take strict measures for epidemic prevention and control, and the implementation of home isolation policy has brought the offline retail market in the United States to a freezing point. In March, the total retail sales of the United States decreased by 5.9% year-on-year, and the retail sales of clothing and apparel (including shoes) decreased by 49%, far more than that of other consumer products. U.S. retail sales fell 16.4% month on month in April, 20% lower than the same period last year. The sales of clothing consumer goods fell 87% year-on-year, ranking the first among all categories. In the next eight months of 2020, the U.S. retail market is struggling. But thanks to the hot sales of food, home furnishings, sports and building materials, the overall sales are still climbing slowly. By the end of 2020, the total retail sales in the United States have been basically the same as that in 2019. However, the sales of clothing products are still in a dilemma and have been in a negative growth trend. The annual sales volume decreased by 26.4% year-on-year.

"Revenge" consumption

Helping us retail clothing products to surpass the pre epidemic level

In 2021, under the multiple influences of the loosening of epidemic prevention and control, the stimulus of fiscal subsidies, and the rebound of consumer confidence, the total retail sales of the United States increased month by month and stabilized at a high level. Consumer's "revenge" consumption of clothing products also began to show signs. In the month when the $1.9 trillion economic stimulus bill came into effect (March 2021), the sales of us clothing products returned to US $25 billion, up 115.4% year-on-year, and 12% higher than the same period in 2019 before the outbreak. In April, this kind of products increased by 764.6% year on year, 10.8% higher than that of the same period before the epidemic. Since then, the retail sales of clothing (including footwear) products in the United States have been playing a triumphant song all the way, and the high growth has been maintained until the end of the year. In 2021, the sales of the above-mentioned products in the United States exceeded $303.1 billion, a year-on-year increase of 48.8%, and a 12.9% increase compared with that in 2019. Textile and clothing consumption basically entered the normal development track.

EU: weight bearing and slow recovery

In January 2020, Britain officially left the European Union, and the 27 countries of the European Union began a new road of development. The outbreak of new crown pneumonia has brought great influence and variables to the new journey of 27 countries. In the early stage of the epidemic development, various factors that were beneficial to economic development, such as highly integrated economy, smooth and developed transportation network, and high frequency of personnel flow, have caused certain difficulties for EU countries to build up anti epidemic barriers in the early stage of the epidemic development. EU countries have begun to introduce measures to prevent and control the epidemic, and stabilize their economic development through fiscal policies. In the middle of the year, the European Commission also proposed an outbreak related economic stimulus plan totalling about 750 billion euros.

EU retail market is in turmoil

In 2020, wave after wave of anti epidemic attacks lead to the loose epidemic prevention policies of EU countries, and the overall retail market performance of EU-27 countries is also constantly fluctuating.

Before the outbreak, the EU retail market has maintained a stable and small growth rate of about 2% to 3%. After the outbreak of the new crown epidemic in 2020, with the strict implementation of the epidemic prevention policies such as home isolation, the retail sales of EU have declined significantly. In March, due to the upgrading of social distance control and prevention and control measures, the EU retail market began to decline. The total retail sales in the month fell by 6.8% year-on-year, and the decline rate reached 17.6% in April. Since May, it has slowly climbed and gradually stabilized.

Compared with the tenacity of the US market, the EU consumption recovery is slightly weak. At the end of October and the beginning of November, the European Union was once again trapped by the impact of the second wave of violent epidemic. Spain, the United Kingdom, France, Germany and other countries have announced that they will continue to take more stringent blockade measures. The strict control and closure of "non key commercial institutions" undoubtedly pour cold water on the newly rising retail market, and the retail market continues to fluctuate violently. Compared with the first half of the year, although the decline in retail sales was reduced, the duration was significantly longer.

After several rounds of epidemic impact, the overall retail sales of 27 EU countries basically recovered to the pre epidemic level in May 2021, and began to maintain a small steady growth, slightly higher than the same period in 2019.

In the absence of strong external stimulus, the recovery of EU clothing retail is slow

Compared with the stable overall retail market, the retail market of textile and clothing products in EU is still not optimistic until the end of 2021. In the absence of continuous large-scale financial subsidies, especially cash subsidies, EU consumers are obviously lack of enthusiasm for "non rigid" clothing and footwear products.

It has been two years since the outbreak, but the retail of textiles, clothing and footwear leather products in EU is still in a difficult development period. According to the statistics released by Eurostat, if the retail sales of textiles, clothing and footwear leather products in each month of the 27 EU countries in 2019 are taken as the index, the comparison between 2020 and 2021 shows that the retail sales of the above-mentioned products in the EU in 2020 are similar to those in the United States, and have experienced a great ups and downs. However, different from the strong rebound trend of American clothing products under the stimulation of multiple external factors such as cash subsidies and retaliatory consumption, in 2020, the retail sales of related products in the EU will fluctuate sharply again in November of that year, except for a cliff fall in the early stage of the epidemic. As of December 2020, compared with the same period in 2019, the retail sales of textiles, clothing and footwear leather products in the EU have decreased significantly by 22%.

After a short rest period, in April 2021, the epidemic situation in the European Union began to fight back again. Many European countries announced the implementation of home isolation, border control, student suspension, night curfew and other measures on the eve of Easter. As a result, the sales of EU clothing products fell again in a "V" shape, and it was not until May that they recovered. As of December 2021, compared with the same period in 2019, the retail sales of textiles, clothing and footwear leather products in EU still decreased by about 15%. However, on the whole, the retail sales of the above-mentioned products in the EU in 2021 are basically slightly better than those in 2020, with an increase of about 9%, showing a slow recovery trend.

Japan: weak and stagnant demand

Weak domestic demand and weak consumption

Restricting the development of clothing retail in Japan

Japan's textile and clothing consumption is depressed due to the superposition of various factors. Japan is one of the most important traditional retail markets of textiles and clothing in the world. However, compared with the United States, the European Union, China and other regions, its retail market is highly dependent on foreign countries, and its own market volume is relatively limited. In addition, after the collapse of the bubble economy, it has been suffering from the constraint of consumption for a long time, and the Japanese market has been in a state of weak demand after the outbreak of the epidemic, The development of textile and clothing consumption is stagnant. Although the Japanese government is also trying to provide cash subsidies in the form of supplementary budget to stimulate economic development and boost consumption, the main areas of benefit are machinery and equipment, medicine and health, fuel and energy, and the retail of daily consumer goods including clothing and clothing has not improved.

Lack of growth momentum, Japan's clothing retail recovery is more difficult

Compared with the European and American retail markets, although the Japanese market also experienced a "sharp drop in April" in the early stage of the epidemic, the degree of change is relatively mild, whether it is the initial decline or the late rebound.

According to the monthly data of textile and clothing retail released by the Ministry of economy, trade and industry of Japan, in April 2020, the biggest impact on the major retail markets in the world, the monthly retail sales of clothing and apparel in Japan decreased by 54.1% year on year, far lower than 87% in the United States and 78% in the European Union. However, in April 2021, one year later, under the dual influence of economic recovery and low base, Japan's textile and clothing retail sales only rebounded and increased by 63.3%, while the European and American regions had strong growth (764.6% in the United States and 130% in the European Union). In terms of sales amount, the retail sales of Japanese clothing and apparel in 2021 was 8.6 trillion yen, which was far lower than the 11 trillion yen in 2019 before the epidemic, and the recovery was weak.

In fact, looking at the development trend of Japan's retail market in recent 10 years, it is not difficult to see that the proportion of textile clothing and clothing consumption in Japan's overall retail consumption shows a slow decline year by year. Under the catalysis of the epidemic situation, Japanese local consumers' desire to buy clothing has been reduced again and again, and the recovery of consumption lacks stamina and is difficult.

China: show resilience and forge ahead

The decline of clothing retail in China in the early stage of the epidemic

Higher than most other consumer goods

China is the first country affected by the new epidemic situation in the world, and it is also one of the countries with the fastest recovery and development from the epidemic. At the beginning of 2020, the outbreak of domestic epidemic, followed by suspension of school, commercial closure, home isolation and other strict epidemic prevention measures, resulting in a significant decline in the domestic retail market. In the first quarter of 2020, domestic consumer goods decreased by nearly 20% year-on-year. Only grain, oil and food sales showed positive growth, while sales of clothing, shoes, hats, knitwear, textiles and daily necessities decreased to varying degrees, among which clothing products had the largest decline.

After April 2020, with the effective control of the domestic epidemic situation, China's economic life has recovered steadily and orderly, and social activities have gradually become active. In addition, with the implementation of the government's various consumption promotion policies, the national consumer goods sales have begun to recover steadily. By the end of 2020, the retail sales of consumer goods decreased by 3.9% year-on-year, while the retail sales of clothing products decreased by 6.6% year-on-year.

Steady economic growth

Drive the retail of Chinese clothing products back to normal development track

In 2021, the sustained recovery and development of the domestic economy has effectively led to the recovery and growth of all kinds of consumer goods sales, and the strong domestic demand market potential has been further stimulated. By the end of the year, China's total retail sales of consumer goods exceeded 44 trillion yuan, an increase of 12.5% over the previous year, with an average growth rate of 3.9% in two years. The retail sales of clothing, shoes, hats, needles and textiles also achieved significant development. The annual retail sales increased by 12.7% year-on-year, 19.3% higher than that in 2020, with an average growth of 2.6% in two years. From the perspective of residents' consumption expenditure, in 2021, the per capita clothing consumption expenditure of national residents will reach 1419 yuan, and the consumption amount will increase significantly.

Online clothing retail in China continues to maintain rapid growth

In the two years of coexistence with the epidemic, domestic online sales have also been further developed. Policies such as home isolation and keeping social distance trigger online shopping in more scenarios. The steady growth of online consumption has also played a strong role in stimulating the domestic demand market. At the end of 2020, the sales of online wearing products nationwide increased by 5.8% year-on-year, better than the same period in 2019. In 2021, the retail sales of online wearing goods increased by 8.3% year-on-year, 2.5 percentage points higher than that in 2020, with an average growth rate of 7% in two years.

Trend Outlook

Extreme uncertainty of global economic development in 2022

Will increase the risk of retail market development

As the biggest external event that has affected the world economic pattern since the economic globalization, the global spread of the new epidemic has a great impact on the economic development of all countries. In 2020, the global economy will fall into the trough of economic recession. In 2021, the world economy will rebound and grow by 5.5%. In 2022, the inflation pressure started in the United States is spreading to the world, and the weak demand situation is difficult to be effectively improved under the repeated impact of the epidemic.

In its global economic outlook in January this year, the world bank lowered its forecast for global economic growth in the new year to 4.1%. The special military action launched by Russia against Ukraine in February and its associated effects have exacerbated the inflationary shock facing the world economy. The conflict between Russia and Ukraine, the "black swan", is likely to lead to further deterioration of the global economy, which is already weak due to the impact of the new epidemic.

Russia Ukraine conflict superimposed by epidemic situation

Or will seriously restrict the development of clothing retail in Europe, the United States and Japan

At present, with the prolongation of the war between Russia and Ukraine and the mutual sanctions between Europe and the United States and Russia in various fields, the world has begun to be affected. With soaring crude oil prices, rising food prices, rising commodity prices, and intensifying stock market volatility and supply chain disorder in many countries, as well as the difficulties faced by many parts of the world, such as enterprise bankruptcy and increasing unemployment rate, consumers' confidence, which has just recovered from the severe impact of the epidemic, is likely to be weakened again. In 2022, the United States, the European Union and Japan and other developed economies under the shadow of global high inflation can not continue to implement effective fiscal stimulus policies to maintain the sustainable development of domestic economy, and their textile and clothing retail market may face greater challenges.

China's textile and clothing retail market continues to move forward under pressure in 2022

In the face of more severe and complex external environment, the development of China's textile and clothing retail market also needs to move forward under pressure. However, with the characteristics of strong toughness, sufficient potential and large space, the fundamentals of China's economy for a long time in the future will not be changed. The government's attention to expanding domestic demand and various positive measures will also help to stabilize the domestic demand market. China's textile and clothing retail market still has stable and favorable development conditions.