China is about to surpass the USA as the world’s largest apparel market
China is the world’s largest textile producer and exporter, with 39 percent market share in 2016, according to l’Économiste. In 2015, exports reached $ 284 billion dollars, mainly for the American market. However, this situation is changing, because China is expected to become the world’s largest apparel market in 2017, ahead of the US. According to PwC study, the Chinese market, run by middle-class expansion, will account for one-third of the total Asian demand. That is the equivalent of the European market or North America market.
The significant growth of the apparel market in China and textile market is due to the vitality of e-commerce in China. In 2013, China surpassed the US as the world’s largest digital retail market, and clothing is the first product categories sold online.
Even if the American apparel market and the Chinese one continue their growth, their pace is totally different.
Since 2011, the American apparel market growth has averaged around 3% per year. In comparison, the Chinese market seems to be more dynamic. Over the last five years, the average growth of the market is 10% per year. Some years the growth jumps, like on 2014 where its rate reaches 18%.
At this pace, China has caught up quickly the American market. In 2012, 91 billion dollars separated those markets. It is estimated that the American advantage will be above 10 billion in 2016. Following these dynamics, the American market is going to lose his first place in2017.
The Chinese apparel market tremendous growth is based on the infrastructures development. Those infrastructures are making the sales development possible on the internet. The growth is also maintained by the emergence of a Chinese middle class, which support the Chinese consumption.
This digitalization is the true growth lever of the Chinese apparel market. According to the forecasts, in 2016 the share of online sales will be 40% of the global Chinese apparel market. On the American market, this share will represent only 20%.
The growth rates comparison of the domestic apparel markets in the US and China from 2012 to 2016 is particularly informative. The American market growth over this period is just 22.5%, whereas Chinese growth amounted to 187.5%. Even when taking into account the absolute value, the American apparel market is beaten by the Chinese market. In 2015 the total online apparel sales amounted to 64 billion dollars, while the Chinese market achieves 115 billion dollars. On 2016, the forecasts expect the Chinese online apparel market to be twice as big as the American market.
Contrarily to the American market, the Chinese one will be able to support this growth level for several years thanks to the economic trend and the Chinese demography.
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