2008- Outerwear Netherlands
CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
CBI MARKET SURVEY
The woven outerwear market in The Netherlands Publication date: October 2009 Report summary This CBI market survey discusses, amongst others, the following highlights for the woven outerwear market in The Netherlands: • Consumption of woven outerwear in The Netherlands increased on average 1.7% annually during the period 2004-2008 and reached € 5.2 billion. Spending of € 316 per person on woven outerwear was above the EU average of € 290. • Woven outerwear production in The Netherlands is very limited. Nearly all manufacturers in The Netherlands have developed an outsourcing policy. • The Netherlands ranked seventh as EU importer of woven outerwear with an import value of € 2.6 billion in 2008, of which an increasing 58% share from developing countries (DCs). In 2004, only 50% of the Netherlands imports came from DCs. • China and Germany (the latter including re-exports) remained the leading suppliers of woven outerwear to The Netherlands. 48% of total imports came from these two countries in 2008, of which China 29% and Germany 19%. • Importers on the woven outerwear market in The Netherlands are domestic manufacturers (which often have production activities abroad); wholesalers/importers; retailers (including buying groups of independents), of which the larger players import by themselves. This survey provides exporters of woven outerwear with sector-specific market information related to gaining access to The Netherlands. By focusing on a specific country, the survey provides additional information, complementary to the more general information and data provided in the CBI market survey ‘The woven outerwear market in the EU’, which covers the EU in general. That survey also contains an overview and explanation of the selected products dealt with, some general remarks on the statistics used as well as information on other available documents for this sector. It can be downloaded from http://www.cbi.eu/marketinfo. 1.
Market description: consumption and production
Consumption Consumer expenditure on woven outerwear in The Netherlands grew on average 1.7% annually during the period 2004-2008 to € 5.2 billion, which was 3.6% of total EU consumption. Average woven outerwear spending per person amounted to € 316 in 2008, which was lower than the other major EU markets (UK, Italy and Germany) but higher than the EU average (€ 290) and Spain. The Netherlands remained the sixth biggest woven outerwear market in the EU behind Germany, UK, Italy, France and Spain. Table 1.1 Consumption of woven outerwear in The Netherlands, 2004-2009, in € million Total clothing Annual change in %
2004
2006
2008
10,050 +3.3%
10,463 +2.2%
10,748 +0.4%
Total outerwear 8,866 9,219 Woven outerwear 4,843 5,038 Sources: Eurostat (2009) and Euromonitor (2009)
9,496 5,173
Av. annual 2009 change forecasts +1.7% 10,550 -1.8% +1.8% +1.7%
9,400 5,100
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
During the period 2004-2008 consumption of woven outerwear in The Netherlands grew by an average 1.7% per annum. Growth in consumer expenditure on woven outerwear was stimulated by factors like: stronger fashionability across the retail spectrum; growing demand for higher quality; and, wider choice of fitting and sizes. On the other side, growth was hampered by factors like the strong price competition, encouraged by a wide availability of clothing at competitive prices, especially by discounters and supermarkets, as well as the increased penetration by imports from low-cost countries. Woven outerwear spending will negatively be affected by changes in economic developments and changes in the demographic profile over the next few years, but positively affected by fashion developments. After a declining but positive growth during the period 2004-2008, trade experts forecast a decline by 1.5% in 2009. Type of product groups Market shares (in terms of value) for woven outerwear in 2008 were trousers and shorts (36%), shirts and blouses (16%), outdoor jackets (11%), indoor jackets (3%), dresses (5%) and skirts (5%). Total products mentioned in table 1.2 covered 76% of total woven outerwear consumption in The Netherlands in 2008. Market shares for other woven outerwear product groups were (among others): active sportswear (5%), babies’ garments (2%), rain- and overcoats (4%), suits and ensembles (3%), clothing accessories (2%). Table 1.2 Consumption of woven outerwear in The Netherlands, 2008 Million units
Average price in €
Av. units per capita
Denim trousers - for men and boys 10.1 36.20 - for women and girls 8.2 33.65 Other cotton trousers - for men and boys 15.3 26.15 - for women and girls 19.1 24.85 Synthetic trousers - for men and boys 1.9 24.65 - for women and girls 3.4 23.30 Shorts 9.5 14.25 Outdoor jackets: -for men and boys 5.8 43.85 -for women and girls 8.1 36.60 Indoor jackets -for men and boys 1.1 74.40 -for women and girls 1.4 58.80 Shirts for men and boys 20.3 21.54 Blouses for women and girls 18.2 20.95 Dresses 6.8 37.40 Skirts 10.2 25.75 Sources: Derived from Eurostat (2009) and Euromonitor (2009)
1.2 1.0 1.9 2.3 0.2 0.4 0.6 0.7 1.0 0.1 0.2 2.5 2.2 0.8 1.2
Cotton trousers and shorts were the sub-sectors which showed the best performance in Dutch clothing. Both in terms of volume and value, these products are still gaining ground. The major jeans brands are therefore still able to convince Dutch men, in particular, to wear more jeans and buy several pairs in different styles and in a variety in washings. Dresses were popular in all lengths and in all seasons of 2007 and 2008, to the detriment of skirts. Purchases of dresses increased in volume 8% in 2008. Expenditure on dresses amounted to three times higher than in 2005. Purchases of skirts decreased in volume (-6%) against 2% lower prices. The role of cotton is dominating in products such as trousers (90% of total items bought), shirts for men and boys (94%); less dominant in woven outerwear for women and girls, such as blouses (69% cotton and 27% synthetics), dresses (59% cotton and 28% synthetics) and
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
skirts (69% cotton and 18% synthetics). The role of man-made fibres is more important for outdoor jackets for men and boys (71% man-made fibres and 29% cotton) and for women and girls (62% man-made fibres and 38% cotton). Market segmentation Common ways to segment the woven outerwear market are by gender (table 1.4) and other demographic factors, attitude of consumers towards fashion, type of activity, life style, by income, brand awareness and preferences, developments in fashion, geographic factors, climate and environment. Some of these segmentation criteria for The Netherlands will be discussed below, while we refer to chapter 2 of the CBI market survey ‘The woven outerwear market in the EU’ for other segmentation criteria. Geographic segmentation is less important in The Netherlands due to the relatively small size of the country. However, differences in age can highlight interesting contrasts when trying to understand the Dutch market. Lifestyle segmentation can reveal buying motivations based on how people live their lives, although the growing trend of individualism in Dutch society makes it more difficult to categorise different lifestyles and draw conclusions about woven outerwear demand. Demographic segmentation The size and age structure of the population is one of the basic determinants of how much will be spent on woven outerwear. The Dutch population is increasing at a slow pace, from 16.1 million in 2002 to 16.4 million in 2008. Despite a small population, The Netherlands is a very densely populated country and has seen its total population rise in recent years. Despite declining, the birth rate still outstrips the falling death rate. Meanwhile, immigration has been consistently on the rise, due to many arrivals from Africa and Asia. At the current rate of growth, the population is expected to surpass 17 million by 2050. Just like in other major EU countries, the category below 15 years has decreased in The Netherlands, while the categories 50 and older have increased substantially. In 2008 34% of the total population was older than 50. Following the ageing trend, also present in other European countries, in 2008 14.7% of the Dutch population was 65 or over compared to 13.8% in 2004. In general, among the west European countries the proportion of those aged 65 plus is around 14-18%. Table 1.3 Population of The Netherlands by age group and sex in 2004-2010, in thousands Males Females Total Age groups (in %) 0-14 15-24 25-49 50-64 65+ Total
2004
2006
2008
8,046 8,212 16,258
8,077 8,257 16,334
8,103 8,280 16,383
2010 forecasts 8,130 8,310 16,440
18.6 11.9 37.3 18.4 13.8 100.0
18.3 12.0 36.5 19.0 14.2 100.0
17.9 12.1 35.6 19.7 14.7 100.0
17.6 12.2 34.7 20.2 15.3 100.0
Sources: Eurostat and Euromonitor The 15-24 age segment of the female population increased to 12.1% in 2008. This age group tends to consist of fashionable consumers of woven outerwear, with a tendency to spend a lot of money on clothing and their personal adornment. These consumers are also likely to look for new styles and designs. The 50-64 age segment grew to 19.7% in the same period. These consumers are modern in their thinking and demands, they are no longer associated with
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
‘granny’ styling and will seek stylish garments, quality and comfort. Table 1.4 Woven outerwear consumption in The Netherlands by gender, 2003-2009, in € million Woven outerwear for: -- women -- men -- children of which for: -- girls -- boys -- babies Total woven outerwear Sources: Euromonitor (2009) and
2004
2006
2008
Av. annual 2009 change forecasts
2,554 1,592 697
2,668 1,646 724
2,749 1,679 745
1.9% 1.3% 1.7%
2,725 1,650 725
356 382 236 243 105 109 4,843 5,038 Eurostat (2009)
388 248 109 5,173
2.2% 1.3% 1.0% 1.7%
375 245 105 5,100
The market for women’s woven outerwear in The Netherlands increased by an annual 1.9% in the period 2004-2008, to reach a value of € 2.7 billion. It is the largest sector, accounting for 53% of the Netherlands woven outerwear market. Expenditure on woven outerwear amounted to € 414 per woman in 2008. The men’s woven outerwear market in The Netherlands rose 1.3% annually in the review period. Per capita expenditure for men amounted to € 247 in 2008. In the children’s sector, 10/14 years was the largest sector in value terms. Per capita spending on children’s clothing (including sportswear and clothing accessories) amounted to an average of € 303 per girl and € 192 per boy aged 3-14 years. Consumption of babies’ woven garments in The Netherlands reached € 109 million in 2008 or 2.1% of total woven outerwear consumption, an average spending of € 297 per child. Girls’ wear is the best performer within the children’s woven outerwear market. Children are having a greater influence on the styles they want and the amount of clothes in their wardrobes. These are key factors in stimulating more demand. The baby segment is helped by indulgent gift buying, especially for newborn babies, as clothes are a popular gift. Sales of outdoor jackets for children stabilised in 2008, while sales in other product groups like jeans, other cotton trousers, dresses and skirts increased. Segmentation by type of activity In general, the woven outerwear market can be divided into several segments, based on type of product combined with type of activity, resulting in a specific clothing behaviour, like formal, (smart) casual, leisure and active sports. Table 1.5 Consumption of woven outerwear by type of clothing behaviour in The Netherlands, 2004-2008, in % of volume Formal Casual Leisure Active sports Total
Women 2004 2008 37 36 37 38 21 22 5 4 100 100
Men 2004 2008 33 33 36 37 25 25 6 5 100 100
Children 2004 2008 9 9 82* 82* 9 9 100 100
* including leisure wear Sources: Derived from Euromonitor (2009) and Gfk (2008)
Purchases in volume of women’s formal clothing decreased in the period 2004-2008, caused by fewer purchases of suits, ensembles and indoor jackets, while purchases of women’s casual and leisurewear (outdoor jackets, cotton trousers, shorts) increased in the review period.
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
Purchases in volume of men’s formal woven outerwear stabilized and casual and leisurewear dominate in men’s expenditure. Leisure and casual items such as cotton trousers, shorts and outdoor jackets remained rather popular among children. Expenditure on active sportswear in the children’s sector had a market share of 9% in 2008. Among boys, the popularity of sportswear brands stabilized. Economic developments Increasing consumer confidence and demand in The Netherlands led to a GDP growth of 3.6% in 2007. In 2008, the growth percentage decreased to 2.0%. The Dutch economy is experiencing its most severe recession in decades, with a steep fall in GDP during 2009 and no sound recovery forecast until late 2010. Private consumption was one of the strongest components in late 2008, but the trend turned in early 2009, following a severe fall in consumer confidence and rising job losses. We estimate that consumer spending will decline from a growth of 1.3% in 2008 to a contraction of 2.4% in 2009. In 2010, we forecast no recovery in private consumption, partly because credit will be less available than in the recent past, but also owing to continued weak employment levels and consumers' savings efforts. At the time of compiling this survey, experts forecast a severe contraction in GDP of 4.6% in 2009 and a further slight fall of 0.4% in 2010, followed by a slow recovery beginning in the second half of the year. There is a risk that GDP will contract more strongly, if economic activity fails to pick up by late 2010. Trends in consumption • The focus on casual and leisurewear for men and children’s wear will be continued in the coming years, but to a much lesser degree. Several fashion forecasts announced that collections will be more feminine and will have fewer casual details. Other forecasts are: o a-symmetrical openings and several layers will become popular. Several lengths can be created in one garment or in a combination of several garments, like skirt with long tunic or blouse and short waistcoat or short jacket on a top. o Accents on the waist by large belts or accents on the neck by wide scarves in accent colours. o Skirts and dresses remain popular in all types and kind of lengths. • Men’s woven outerwear has suffered from increased price competition. However, the extent of this competition has been lessened by a greater shift towards fashion and branded goods across the sector. The value of men’s woven outerwear sales is expected to grow faster than that of women’s woven outerwear. • Future growth in children’s wear and infant’s wear is, for an important part, undermined by long-term demographic trends, which lead to a small growth in volume, but a greater increase in value. Babies’ and children’s wear are becoming as susceptible to fashion trends as adult clothing. Collections include sportswear items and trendy garments, with an adult look. • A growing number of consumers is environment-minded and several manufacturers of trendy and fashionable brands have expanded their collections with products made of organic cotton and/or claims regarding ‘100% child labour free’ products. More general trends and fashion trends related to woven outerwear can be found in chapter 1 of the CBI market survey ‘The woven outerwear market in the EU’. Production Increasing imports have resulted in a sharp reduction in the number of companies manufacturing clothes. This number fell to 1,200 in 2007. Around 78% of these companies employ only one or two people. Clothing production in The Netherlands is very limited. Nearly all manufacturers in The Netherlands have developed an outsourcing policy. Despite the absence of domestic production capacity, exports increased by an annual 5% (in value) during the period 2004-2008, which underlines the trading position of The Netherlands and the role of re-exports. Clothing production in The Netherlands can be estimated at € 3,500 million and includes production abroad in 2008.
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
Major players Highest turnovers (including woven outerwear) in the Dutch clothing sector were reached by Mexx, casual wear for the whole family (http://www.mexx.com), Veldhoven Group, including brands like Sandwich, Stills and Nono (http://www.veldhovengroup.com), Secon Group, including brands like Turnover, Another Woman, Creenstone and Arrow (http://www.secon.nl) and the Mc Gregor Fashion Group (http://www.mcgregor-fashion.com). However, these companies do not have their own production facilities. Activities developed by these companies are functions like design, purchase of materials (fabrics, trims etc.), trade (B2B) and even retail trade. A more or less complete overview of manufacturers in The Netherlands can be found in the directory of the trade association Modint at http://directory.modint.nl/zoekaanbieder.asp Trends in production • A high degree of integration in the value chain. More and more manufacturers of brands open their own brand stores. • A further decrease in the number of manufacturing companies as a result of growing imports from low-cost countries. • CSI (Corporate Sustainable Issues) are becoming more important. More trends about production of woven outerwear can be found in chapter 2 of the CBI market survey ‘The woven outerwear market in the EU’. Opportunities and threats + The Netherlands ranked sixth in EU woven outerwear expenditure. Expectations for consumer expenditure on woven outerwear for the period 2007-2009 are moderately optimistic. There are several reasons for this optimism, like demographic developments, growing interest of consumers in fashion and expected growth in consumer expenditure. + Further sourcing of products in low-cost countries has led to diminished presence of production in The Netherlands, including products with higher design content. The largest middle-range market segment may offer good opportunities for exporters in DCs. ± The number of garments purchased per head of the population will continue to rise, but prices will not follow this growth rate. ± To satisfy the requirements of importing companies in The Netherlands and other EU countries, exporters in DCs will be faced with increased demands for higher quality and environmentally friendly products. ± The focus on casual and leisurewear will be continued for the coming years, but to a much lesser degree. Besides this trend, there is a tendency to use more natural fibres, mainly cotton and blends with cotton, at the expense of man-made fibres. The same development or trend can be an opportunity for one exporter and a threat to another. Exporters should therefore analyse if the developments and trends discussed in this survey provide opportunities or threats. The outcome of this analysis depends on each exporter’s specific circumstances. See chapter 7 of the EU survey ‘The woven outerwear market in the EU’ for more information on opportunities and threats. Useful sources Euratex Bulletins - http://www.euratex.org Modint - http://directory.modint.nl/zoekaanbieder.asp
2.
Trade channels for market entry
Trade channels The most suitable trade channels on the Dutch woven outerwear market for exporters in DCs, are:
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
• domestic manufacturers; • wholesalers/importers, selling to retail organisations; • retailers, of which the larger players or buying groups of independents import by themselves. Which channel will be chosen, depends on factors like (among others): • Which type of woven outerwear producer (CMT, FOB, private label or own brand producer) tends to export to The Netherlands. These types of producer are described in chapter 1 and 2 of the CBI survey ‘Guidelines for exporting woven outerwear to the EU’. • The resources available and the priority given to the Dutch market. Domestic manufacturers Production has been discussed in chapter 1 of this survey and more general information can be found in chapter 2 of the CBI market survey ‘The woven outerwear market in the EU’. The large companies in the clothing sector as mentioned in the previous chapter have production activities abroad. The number of woven outerwear manufacturers is limited but opportunities exist for exporters, who are interested in forming relationships or partnerships with Dutch producers. The website of Modint’s directory gives information about the manufacturers of woven outerwear in The Netherlands http://directory.modint.nl/zoekaanbieder.asp Wholesale trade About 2,000 wholesalers, of which 800 are of considerable importance, are active in imports in The Netherlands in the clothing sector. A number of them is member of the FTGB (textiles wholesalers association). Information about them can be found on http://www.nvg.nl while another part can be found on the website of the NVKT (agents and importers of clothing and textiles) on http://www.nvkt.nl. There are different sales intermediaries active between industry and retail, as described in chapter 3 of the CBI market survey ‘The woven outerwear market in the EU’. An overview of brand names in the related segments of the clothing market can be found in chapter 1 (page 8 and 9). Examples of wholesalers in The Netherlands are, among others: Zantman Modegroep (http://www.zantman.nl), HMZ (http://www.hmz.nl), Jago (clothing accessories; http://www.jago.nl), Bodewes (http://www.bodewes.nl), Masita (sportswear; http://www.masita.com) and Lunter Textiel (http://www.luntertextiel.nl). Retail trade The clothing retail structure in The Netherlands differs greatly from those found in other major EU countries. Specialists face limited competition, mainly from department and variety stores and home shopping, while super- and hypermarkets play a minor role. The holding Maxeda (former name Vendex/KBB; http://www.maxeda.com) is the largest nonfood retailer selling fashion in the country and includes the department stores Vroom & Dreesman and Bijenkorf, the fashion multiples M&S Mode (women’s wear), Claudia Sträter (women’s wear) and Hunkemöller (body wear). Many Netherlands retail organisations have set up chains abroad: M&S, We Men/Women and Cool Cat are examples of internationally-oriented chains, just like variety chain Hema and textile discounters Zeeman and Wibra. There is an increasing number of outlets in The netherlands, mainly clothing multiples, including strongly expanding chains from abroad like Hennes & Mauritz (97 stores) from Sweden, Vögele Mode (115) from Switzerland, Vero Moda (80), Only (35) and Jack & Jones (60) from Denmark, Esprit (51 directly managed stores from Germany/Hong Kong), Benetton (200 stores) from Italy and Ulla Poken (36) from Germany. Other foreign retailers are rather small in The Netherlands, such as Zara (15) and Mango (10) from Spain and, Gant (12) from the USA.
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
Table 2.1 Market shares of retail distribution of outerwear in The Netherlands, 2004-2008, in % of value 2004 Specialists 70 Independent retailers 31 Clothing multiples 39 Non-specialists 30 Department and variety stores 8 Textile supermarkets 3 Sports speciality stores 3 Home shopping companies 5 Other 11 Total 100 Sources: GFK (2009) and CBS (2009)
2006
2008
69 29 40 31 8 3 3 5 12 100
69 27 42 31 7 3 3 6 12 100
Women 72 27 45 28 5 3 3 7 10 100
2008 Men 68 29 39 32 7 3 5 6 11 100
Children 55 19 36 45 12 10 3 8 12 100
In The Netherlands, there are around 10,700 outlets in the outerwear sector exploited by 6,400 companies, of which 60% can be classified as independent retailers. 40% of Netherlands independent retailers is organised in central buying organisations and, to a lesser degree, franchise organisations. The main operations of independent retailers lie in the middle and upper sections of the market. The leading buying organisations are Intres (http://www.intres.nl) and Euretco (http://www.euretco.nl). Intres has the following formula for woven outerwear: selling formula First Lady (32 women’s wear stores) and First Man (17 men’s wear stores), buying formula in men’s wear like Alpha (70 stores); in women’s wear: Ladies Department (26) and Forum (80); in children’s wear: Get Smart (60), Ministars (60) and AUB stores (25), and for sportswear: Intersport (120; http://www.intersport.nl ), Coach (58; http://www.coach.nl) and G.O.S Sport (independents operating under own name via almost 100 stores). Euretco Fashion is the owner of formula such as for sportswear: Sportpoint (140; http://www.sportpoint.nl) and Sport 2000 (111; http://www.sport2000.nl). Other (smaller) buying organisations are Hadac (25 members operating through 55 stores, higher segments of women’s wear; http://www.hadac.nl) and Deco (110 stores, higher segments men’s and women’s wear; http://www.decobrm.nl); The retail market for women’s outerwear has many players, while the number of chains in men’s outerwear and in the children’s outerwear sector is very limited. The following overview gives the important Dutch chains, operating in The Netherlands. Table 2.2 Major specialised clothing chains of Dutch origin in The Netherlands, 2008 Retail chain General clothing C&A Duthler We Men/Women Shoeby Fasion Cool Cat Men’s wear Adam Women’s wear Didi Fashion M&S Mode Miss Etam Promiss Steps Pulls SPS (Superstar) Witteveen Wonder Woman
Parent company
Website
C&A Brova WE Europe Shoeby Cool Cat Fashion
http://www.c-and-a.com http://www.duthler.com http://www.wefashion.com http://www.shoebyfashion.nl http://www.coolcat.nl
Mc Gregor Group
http://www.adam.nl
Coltex Maxeda Etam Groep Etam Groep NFD Van der Wijk Coltex Witteveen Cool Cat Fashion
http://www.didi.nl http://www.msmode.com http://etam.nl http://www.promiss.nl http://www.steps.nl
http://www.pulls.nl
http://www.sps-superstar.nl
http://www.witteveen-mode.com http://www.wonderwoman.nl
Number of outlets 125 30 122/226* 200 80/117* 52 118/141*) 137/402* 126 65 88 23 79 83/85*) 45
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
Retail chain
Parent company
Claudia Sträter Maxeda Leisure wear Forecast/Vet Coltex Jeans Centre Jeans Centre Newport Blue Newport Blue Score Score Group Children’s wear Villa Happ Villa Happ Nederland Babies’/maternity Prenatal Artsana Outdoor and sports Perry Sport CVC Aktie Sport Bron Beheer Bever Zwerfsport Bever Zwerfsport *) including outlets abroad
Website http://www.claudiastrater.com http://www.forecast.nl http://www.jeanscentre.nl http://www.newportblue.nl http://www.score.nl
Number of outlets 20/33* 60 81 32 66/81*
http://www.villahapp.nl
48
http://www.prenatal.nl
78
http://www.perrysport.nl http://www.aktiesport.nl http://www.bever.nl
51 151 32
There are two department stores of importance, namely V&D (http://www.vd.nl) and De Bijenkorf (http://www.bijenkorf.nl). Both are part of Maxeda Holding and both sell outerwear. De Bijenkorf has 12 stores and stocks high-quality, stylish and appropriately priced products. V&D operates in the middle of the market with 62 outlets of different sizes. The variety store Hema (Lions Capital) has 416 sales outlets, of which 62 are located in Belgium, 8 in Germany, 1 in France and 1 in Luxembourg. The Hema (http://www.hema.nl) claims to be the market leader in several product groups, among others, in babies’ clothing. All articles are sold under the private label Hema. Due to the extended network of retail shops in The Netherlands, home shopping has a much lower market share than most other EU countries. Mail-order houses operate via catalogues and Internet and in some cases tele-shopping, mainly in the middle ranges as regards price, quality and fashion. The most important companies are Wehkamp (http://www.wehkamp.nl) and Otto Nederland (http://www.otto.nl), part of Otto Versand from Germany. Several Dutch retail organisations operate also via Internet, mail-order and home shopping. Important discount chains in textiles (often indicated as textile supermarkets) are Zeeman Textielsupers with 1,050 outlets, of which over 500 are in The Netherlands, almost 250 in Germany, over 200 in Belgium, 60 in France and 11 in Luxembourg (http://www.zeeman.com), Wibra with 250 outlets, of which 166 stores are in The Netherlands and 84 in Belgium (http://www.wibra.nl), Hans Textiel & Mode (174 outlets; (http://www.hanstextiel.nl), Henk ten Hoor (84 outlets; http://www.henktenhoor.nl) and Ter Stal (173 outlets; http://www.terstal.nl). Most products under review in this survey are part of the assortment of the above-mentioned textile discounters. Discounters, which originally only sold footwear like Scapino (204 stores; http://www.scapino.nl), Bristol (128 stores; http://www.bristol-online.nl), have expanded their assortment to include outerwear, sportswear and bodywear. This example has been followed by other footwear discounters, like Schoenenreus (222 stores including Belgium and Luxembourg; http://www.schoenenreus.nl). The main activities of grocery supermarkets are in the provisions sector, however, super- and hypermarkets have (mainly low-priced) outerwear incidentally in their assortment. Supermarket chains are Albert Heijn (760 stores), Aldi (460 stores), Lidl (234 stores), Dirk van de Broek (91 stores), Deka Markt (85 stores), Deen (56 stores) and Vomar (54 stores). Clothing market shares of the originally-German Aldi and Lidl are highest. The category ‘Other non-specialized channels’ in table 2.1 includes the Makro, a cash-and-carry formula, part of the German Metro Group with 16 stores in The Netherlands. Makro is a wholesaler with retail activities. Besides Makro, this category also includes street markets and
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
factory outlets. Companies in this category (with the exception of the Makro) are not themselves involved in importing. Trends • The non-food offer in the groceries sector is limited in The Netherlands. The hypermarket format, with its strong non-food component, plays a smaller role in clothing sales than in the rest of the EU. However, a limited growth is expected for the coming years. • The specialist clothing sector in The Netherlands is becoming more concentrated. The leading buying groups: Euretco and Intres, of which most of the members are independent retailers, hold a strong position in the national market. • Most of the retail chains have expanded their activities abroad, mainly to Belgium and Germany. Price structure Nearly all of the above-mentioned retail organisations are active in the mid-market and/or lower-market segments. Chapter 1 of CBI’s market survey ‘The woven outerwear market in the EU’ gives an indication of differences in price levels, while an overview of margins valid for the various segments in the woven outerwear market can be found in chapter 3 of the same survey. Price is an important selling factor, especially in the lower segments of the market (variety stores, hypermarkets and discounters), whereas in the higher segments (higher added value) factors like quality and fashion are more important than price. In the lower segments of the market, retailers have little room to manipulate prices, because competition is very fierce and margins are low. Margins have been falling in The Netherlands in recent years, as a result of intense competition in the supply chain and an intensification of competition between retailers. Different margins and prices apply in each trade channel, with multiples of 2.1 up to 3.1 of the export (CIF) price as is shown in table 2.3. These margins will vary depending on which market segment is being approached. The higher the market segment, the higher the margins which can be reached. Table 2.3 Overview of margins in outerwear in The Netherlands Low High Importers/wholesalers' margins Agents' margins Retailers' margins Mark-up Export (CIF) price - Consumer price
30% 10% 35-40% 2.1
40% 15% 65% 3.1
Finding a suitable trading partner When trying to find a trading partner, the usual trade sources are an important point of contact. Another possibility for selecting potential trading partners is an orientation on the websites of branch organisations (as described above), such as Modint, FTGB and NVKT. The best place to meet potential trading partners is at a trade fair i.e. Modefabriek (http://www.modefabriek.nl) and Amsterdam Fashion Week http://www.amsterdamfashionweek.com), even though these fairs have a local and modest character. Another meeting point is a trade centre, such as the WFC (World Fashion Centre; http://www.worldfashioncentre.nl ) in Amsterdam. A list of exhibitors can be found at the trade fair and trade centre websites. Another possibility for finding potential trading partners is an orientation on Internet and/or consulting the general trade directories. More information can be found in the CBI manuals ‘EU marketing guidelines for woven outerwear’ and ‘Export Planner’. Useful sources: The Association of Dutch Chambers of Industry and Commerce - http://www.kvk.nl The Dutch Retail Council - http://www.raadnederlandsedetailhandel.nl
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
3.
Trade: imports and exports
3.1 Imports Netherlands’ imports increased 6.5% (in terms of value) during the period 2004-2006 and fell 4.1% during the period 2006-2008. Imports amounted to € 2.6 billion or 5% of the total EU exported value in 2008. The Netherlands ranked seventh in EU woven outerwear exports behind Spain and Belgium, and above Austria. Average import prices fluctuated during the period 2006-2008: a fall of 4% in 2007 and a growth of 3% in 2008, mainly caused by the intensive competition, both at trade level and at suppliers’ level. Sources China and Germany (including re-exports) remained the leading suppliers of woven outerwear to The Netherlands. 48% of total imports came from these two countries in 2008, of which China 29% and Germany 19%. Other important suppliers came from Turkey (8% of total imports), Italy (6%), India (5%), Bangladesh and Denmark (each country 4%). Growing suppliers (exports valued more than € 25 million and a growth in imports) of woven outerwear during the period 2006-2008 were China, Germany, Italy, Denmark, Tunisia and Poland. In terms of value, 58% of imported woven outerwear came from DCs. In 2006, 56% of The Netherlands imports came from DCs and 50% in 2004. Main developments in area of origin of woven outerwear imports by The Netherlands in the period 2006-2008 were: • Total woven outerwear imports fell 4.0%. Imports from DCs grew slightly (+0.6%) mainly to the detriment of non-EU countries other than DCs (-49%), while imports from other EU countries stabilized; • Imports from leading supplier China increased by 15% to an import share of 29% of total imports, or 51% of total imports from DCs; • Imports from Asian DCs (except China) fell by 16% to a share of 14%, lower imports came from India (-10%), Bangladesh (-16%), Vietnam (-21%), Indonesia (-44%) and Pakistan (-2%), while imports from Thailand (+42%) increased; • Imports from Mediterranean DCs decreased by 5% to a share of 13%, caused by strongly reduced imports from Turkey (-13%) and Morocco (-28%) and despite higher imports from Tunisia (+18%) and Macedonia (+35%); • Imports from CEECs grew 18% to € 30 million, an import share of 1%, caused by higher imports from Ukraine (+77%) and despite lower imports from Belarus (-14%) and Moldova (-51%); • Imports from Central & South America fell 9%, mainly Brazil (-32%) and despite increased imports from Mexico (+149%) to a limited € 3 million in 2008; • Imports from ACP countries grew by 21%, caused by increased imports from Mauritius (+46%) to € 7 million in 2008. Imports from Mauritius covered 98% of total imports from ACP countries. Table 3.1 Imports of woven outerwear by and leading suppliers to The Netherlands in 2004-2008, share in % of value Total Intra-EU: Extra-EU ex. DCs: DCs:
2004 € mln 2,440 1,043
2006 € mln 2,683 1,053
181
122
1,216
1,507
2008 Leading suppliers in 2008 € mln (share of total imports in %) 2,632 1,054 Germany (19); Italy (6); Denmark (4); Belgium (3); Poland (2); France (2); Czech Republic (1); Spain (1). 62 Hong Kong (1); USA (
CBI MARKET SURVEY
The woven outerwear market in The Netherlands Publication date: October 2009 Report summary This CBI market survey discusses, amongst others, the following highlights for the woven outerwear market in The Netherlands: • Consumption of woven outerwear in The Netherlands increased on average 1.7% annually during the period 2004-2008 and reached € 5.2 billion. Spending of € 316 per person on woven outerwear was above the EU average of € 290. • Woven outerwear production in The Netherlands is very limited. Nearly all manufacturers in The Netherlands have developed an outsourcing policy. • The Netherlands ranked seventh as EU importer of woven outerwear with an import value of € 2.6 billion in 2008, of which an increasing 58% share from developing countries (DCs). In 2004, only 50% of the Netherlands imports came from DCs. • China and Germany (the latter including re-exports) remained the leading suppliers of woven outerwear to The Netherlands. 48% of total imports came from these two countries in 2008, of which China 29% and Germany 19%. • Importers on the woven outerwear market in The Netherlands are domestic manufacturers (which often have production activities abroad); wholesalers/importers; retailers (including buying groups of independents), of which the larger players import by themselves. This survey provides exporters of woven outerwear with sector-specific market information related to gaining access to The Netherlands. By focusing on a specific country, the survey provides additional information, complementary to the more general information and data provided in the CBI market survey ‘The woven outerwear market in the EU’, which covers the EU in general. That survey also contains an overview and explanation of the selected products dealt with, some general remarks on the statistics used as well as information on other available documents for this sector. It can be downloaded from http://www.cbi.eu/marketinfo. 1.
Market description: consumption and production
Consumption Consumer expenditure on woven outerwear in The Netherlands grew on average 1.7% annually during the period 2004-2008 to € 5.2 billion, which was 3.6% of total EU consumption. Average woven outerwear spending per person amounted to € 316 in 2008, which was lower than the other major EU markets (UK, Italy and Germany) but higher than the EU average (€ 290) and Spain. The Netherlands remained the sixth biggest woven outerwear market in the EU behind Germany, UK, Italy, France and Spain. Table 1.1 Consumption of woven outerwear in The Netherlands, 2004-2009, in € million Total clothing Annual change in %
2004
2006
2008
10,050 +3.3%
10,463 +2.2%
10,748 +0.4%
Total outerwear 8,866 9,219 Woven outerwear 4,843 5,038 Sources: Eurostat (2009) and Euromonitor (2009)
9,496 5,173
Av. annual 2009 change forecasts +1.7% 10,550 -1.8% +1.8% +1.7%
9,400 5,100
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
During the period 2004-2008 consumption of woven outerwear in The Netherlands grew by an average 1.7% per annum. Growth in consumer expenditure on woven outerwear was stimulated by factors like: stronger fashionability across the retail spectrum; growing demand for higher quality; and, wider choice of fitting and sizes. On the other side, growth was hampered by factors like the strong price competition, encouraged by a wide availability of clothing at competitive prices, especially by discounters and supermarkets, as well as the increased penetration by imports from low-cost countries. Woven outerwear spending will negatively be affected by changes in economic developments and changes in the demographic profile over the next few years, but positively affected by fashion developments. After a declining but positive growth during the period 2004-2008, trade experts forecast a decline by 1.5% in 2009. Type of product groups Market shares (in terms of value) for woven outerwear in 2008 were trousers and shorts (36%), shirts and blouses (16%), outdoor jackets (11%), indoor jackets (3%), dresses (5%) and skirts (5%). Total products mentioned in table 1.2 covered 76% of total woven outerwear consumption in The Netherlands in 2008. Market shares for other woven outerwear product groups were (among others): active sportswear (5%), babies’ garments (2%), rain- and overcoats (4%), suits and ensembles (3%), clothing accessories (2%). Table 1.2 Consumption of woven outerwear in The Netherlands, 2008 Million units
Average price in €
Av. units per capita
Denim trousers - for men and boys 10.1 36.20 - for women and girls 8.2 33.65 Other cotton trousers - for men and boys 15.3 26.15 - for women and girls 19.1 24.85 Synthetic trousers - for men and boys 1.9 24.65 - for women and girls 3.4 23.30 Shorts 9.5 14.25 Outdoor jackets: -for men and boys 5.8 43.85 -for women and girls 8.1 36.60 Indoor jackets -for men and boys 1.1 74.40 -for women and girls 1.4 58.80 Shirts for men and boys 20.3 21.54 Blouses for women and girls 18.2 20.95 Dresses 6.8 37.40 Skirts 10.2 25.75 Sources: Derived from Eurostat (2009) and Euromonitor (2009)
1.2 1.0 1.9 2.3 0.2 0.4 0.6 0.7 1.0 0.1 0.2 2.5 2.2 0.8 1.2
Cotton trousers and shorts were the sub-sectors which showed the best performance in Dutch clothing. Both in terms of volume and value, these products are still gaining ground. The major jeans brands are therefore still able to convince Dutch men, in particular, to wear more jeans and buy several pairs in different styles and in a variety in washings. Dresses were popular in all lengths and in all seasons of 2007 and 2008, to the detriment of skirts. Purchases of dresses increased in volume 8% in 2008. Expenditure on dresses amounted to three times higher than in 2005. Purchases of skirts decreased in volume (-6%) against 2% lower prices. The role of cotton is dominating in products such as trousers (90% of total items bought), shirts for men and boys (94%); less dominant in woven outerwear for women and girls, such as blouses (69% cotton and 27% synthetics), dresses (59% cotton and 28% synthetics) and
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
skirts (69% cotton and 18% synthetics). The role of man-made fibres is more important for outdoor jackets for men and boys (71% man-made fibres and 29% cotton) and for women and girls (62% man-made fibres and 38% cotton). Market segmentation Common ways to segment the woven outerwear market are by gender (table 1.4) and other demographic factors, attitude of consumers towards fashion, type of activity, life style, by income, brand awareness and preferences, developments in fashion, geographic factors, climate and environment. Some of these segmentation criteria for The Netherlands will be discussed below, while we refer to chapter 2 of the CBI market survey ‘The woven outerwear market in the EU’ for other segmentation criteria. Geographic segmentation is less important in The Netherlands due to the relatively small size of the country. However, differences in age can highlight interesting contrasts when trying to understand the Dutch market. Lifestyle segmentation can reveal buying motivations based on how people live their lives, although the growing trend of individualism in Dutch society makes it more difficult to categorise different lifestyles and draw conclusions about woven outerwear demand. Demographic segmentation The size and age structure of the population is one of the basic determinants of how much will be spent on woven outerwear. The Dutch population is increasing at a slow pace, from 16.1 million in 2002 to 16.4 million in 2008. Despite a small population, The Netherlands is a very densely populated country and has seen its total population rise in recent years. Despite declining, the birth rate still outstrips the falling death rate. Meanwhile, immigration has been consistently on the rise, due to many arrivals from Africa and Asia. At the current rate of growth, the population is expected to surpass 17 million by 2050. Just like in other major EU countries, the category below 15 years has decreased in The Netherlands, while the categories 50 and older have increased substantially. In 2008 34% of the total population was older than 50. Following the ageing trend, also present in other European countries, in 2008 14.7% of the Dutch population was 65 or over compared to 13.8% in 2004. In general, among the west European countries the proportion of those aged 65 plus is around 14-18%. Table 1.3 Population of The Netherlands by age group and sex in 2004-2010, in thousands Males Females Total Age groups (in %) 0-14 15-24 25-49 50-64 65+ Total
2004
2006
2008
8,046 8,212 16,258
8,077 8,257 16,334
8,103 8,280 16,383
2010 forecasts 8,130 8,310 16,440
18.6 11.9 37.3 18.4 13.8 100.0
18.3 12.0 36.5 19.0 14.2 100.0
17.9 12.1 35.6 19.7 14.7 100.0
17.6 12.2 34.7 20.2 15.3 100.0
Sources: Eurostat and Euromonitor The 15-24 age segment of the female population increased to 12.1% in 2008. This age group tends to consist of fashionable consumers of woven outerwear, with a tendency to spend a lot of money on clothing and their personal adornment. These consumers are also likely to look for new styles and designs. The 50-64 age segment grew to 19.7% in the same period. These consumers are modern in their thinking and demands, they are no longer associated with
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
‘granny’ styling and will seek stylish garments, quality and comfort. Table 1.4 Woven outerwear consumption in The Netherlands by gender, 2003-2009, in € million Woven outerwear for: -- women -- men -- children of which for: -- girls -- boys -- babies Total woven outerwear Sources: Euromonitor (2009) and
2004
2006
2008
Av. annual 2009 change forecasts
2,554 1,592 697
2,668 1,646 724
2,749 1,679 745
1.9% 1.3% 1.7%
2,725 1,650 725
356 382 236 243 105 109 4,843 5,038 Eurostat (2009)
388 248 109 5,173
2.2% 1.3% 1.0% 1.7%
375 245 105 5,100
The market for women’s woven outerwear in The Netherlands increased by an annual 1.9% in the period 2004-2008, to reach a value of € 2.7 billion. It is the largest sector, accounting for 53% of the Netherlands woven outerwear market. Expenditure on woven outerwear amounted to € 414 per woman in 2008. The men’s woven outerwear market in The Netherlands rose 1.3% annually in the review period. Per capita expenditure for men amounted to € 247 in 2008. In the children’s sector, 10/14 years was the largest sector in value terms. Per capita spending on children’s clothing (including sportswear and clothing accessories) amounted to an average of € 303 per girl and € 192 per boy aged 3-14 years. Consumption of babies’ woven garments in The Netherlands reached € 109 million in 2008 or 2.1% of total woven outerwear consumption, an average spending of € 297 per child. Girls’ wear is the best performer within the children’s woven outerwear market. Children are having a greater influence on the styles they want and the amount of clothes in their wardrobes. These are key factors in stimulating more demand. The baby segment is helped by indulgent gift buying, especially for newborn babies, as clothes are a popular gift. Sales of outdoor jackets for children stabilised in 2008, while sales in other product groups like jeans, other cotton trousers, dresses and skirts increased. Segmentation by type of activity In general, the woven outerwear market can be divided into several segments, based on type of product combined with type of activity, resulting in a specific clothing behaviour, like formal, (smart) casual, leisure and active sports. Table 1.5 Consumption of woven outerwear by type of clothing behaviour in The Netherlands, 2004-2008, in % of volume Formal Casual Leisure Active sports Total
Women 2004 2008 37 36 37 38 21 22 5 4 100 100
Men 2004 2008 33 33 36 37 25 25 6 5 100 100
Children 2004 2008 9 9 82* 82* 9 9 100 100
* including leisure wear Sources: Derived from Euromonitor (2009) and Gfk (2008)
Purchases in volume of women’s formal clothing decreased in the period 2004-2008, caused by fewer purchases of suits, ensembles and indoor jackets, while purchases of women’s casual and leisurewear (outdoor jackets, cotton trousers, shorts) increased in the review period.
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
Purchases in volume of men’s formal woven outerwear stabilized and casual and leisurewear dominate in men’s expenditure. Leisure and casual items such as cotton trousers, shorts and outdoor jackets remained rather popular among children. Expenditure on active sportswear in the children’s sector had a market share of 9% in 2008. Among boys, the popularity of sportswear brands stabilized. Economic developments Increasing consumer confidence and demand in The Netherlands led to a GDP growth of 3.6% in 2007. In 2008, the growth percentage decreased to 2.0%. The Dutch economy is experiencing its most severe recession in decades, with a steep fall in GDP during 2009 and no sound recovery forecast until late 2010. Private consumption was one of the strongest components in late 2008, but the trend turned in early 2009, following a severe fall in consumer confidence and rising job losses. We estimate that consumer spending will decline from a growth of 1.3% in 2008 to a contraction of 2.4% in 2009. In 2010, we forecast no recovery in private consumption, partly because credit will be less available than in the recent past, but also owing to continued weak employment levels and consumers' savings efforts. At the time of compiling this survey, experts forecast a severe contraction in GDP of 4.6% in 2009 and a further slight fall of 0.4% in 2010, followed by a slow recovery beginning in the second half of the year. There is a risk that GDP will contract more strongly, if economic activity fails to pick up by late 2010. Trends in consumption • The focus on casual and leisurewear for men and children’s wear will be continued in the coming years, but to a much lesser degree. Several fashion forecasts announced that collections will be more feminine and will have fewer casual details. Other forecasts are: o a-symmetrical openings and several layers will become popular. Several lengths can be created in one garment or in a combination of several garments, like skirt with long tunic or blouse and short waistcoat or short jacket on a top. o Accents on the waist by large belts or accents on the neck by wide scarves in accent colours. o Skirts and dresses remain popular in all types and kind of lengths. • Men’s woven outerwear has suffered from increased price competition. However, the extent of this competition has been lessened by a greater shift towards fashion and branded goods across the sector. The value of men’s woven outerwear sales is expected to grow faster than that of women’s woven outerwear. • Future growth in children’s wear and infant’s wear is, for an important part, undermined by long-term demographic trends, which lead to a small growth in volume, but a greater increase in value. Babies’ and children’s wear are becoming as susceptible to fashion trends as adult clothing. Collections include sportswear items and trendy garments, with an adult look. • A growing number of consumers is environment-minded and several manufacturers of trendy and fashionable brands have expanded their collections with products made of organic cotton and/or claims regarding ‘100% child labour free’ products. More general trends and fashion trends related to woven outerwear can be found in chapter 1 of the CBI market survey ‘The woven outerwear market in the EU’. Production Increasing imports have resulted in a sharp reduction in the number of companies manufacturing clothes. This number fell to 1,200 in 2007. Around 78% of these companies employ only one or two people. Clothing production in The Netherlands is very limited. Nearly all manufacturers in The Netherlands have developed an outsourcing policy. Despite the absence of domestic production capacity, exports increased by an annual 5% (in value) during the period 2004-2008, which underlines the trading position of The Netherlands and the role of re-exports. Clothing production in The Netherlands can be estimated at € 3,500 million and includes production abroad in 2008.
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
Major players Highest turnovers (including woven outerwear) in the Dutch clothing sector were reached by Mexx, casual wear for the whole family (http://www.mexx.com), Veldhoven Group, including brands like Sandwich, Stills and Nono (http://www.veldhovengroup.com), Secon Group, including brands like Turnover, Another Woman, Creenstone and Arrow (http://www.secon.nl) and the Mc Gregor Fashion Group (http://www.mcgregor-fashion.com). However, these companies do not have their own production facilities. Activities developed by these companies are functions like design, purchase of materials (fabrics, trims etc.), trade (B2B) and even retail trade. A more or less complete overview of manufacturers in The Netherlands can be found in the directory of the trade association Modint at http://directory.modint.nl/zoekaanbieder.asp Trends in production • A high degree of integration in the value chain. More and more manufacturers of brands open their own brand stores. • A further decrease in the number of manufacturing companies as a result of growing imports from low-cost countries. • CSI (Corporate Sustainable Issues) are becoming more important. More trends about production of woven outerwear can be found in chapter 2 of the CBI market survey ‘The woven outerwear market in the EU’. Opportunities and threats + The Netherlands ranked sixth in EU woven outerwear expenditure. Expectations for consumer expenditure on woven outerwear for the period 2007-2009 are moderately optimistic. There are several reasons for this optimism, like demographic developments, growing interest of consumers in fashion and expected growth in consumer expenditure. + Further sourcing of products in low-cost countries has led to diminished presence of production in The Netherlands, including products with higher design content. The largest middle-range market segment may offer good opportunities for exporters in DCs. ± The number of garments purchased per head of the population will continue to rise, but prices will not follow this growth rate. ± To satisfy the requirements of importing companies in The Netherlands and other EU countries, exporters in DCs will be faced with increased demands for higher quality and environmentally friendly products. ± The focus on casual and leisurewear will be continued for the coming years, but to a much lesser degree. Besides this trend, there is a tendency to use more natural fibres, mainly cotton and blends with cotton, at the expense of man-made fibres. The same development or trend can be an opportunity for one exporter and a threat to another. Exporters should therefore analyse if the developments and trends discussed in this survey provide opportunities or threats. The outcome of this analysis depends on each exporter’s specific circumstances. See chapter 7 of the EU survey ‘The woven outerwear market in the EU’ for more information on opportunities and threats. Useful sources Euratex Bulletins - http://www.euratex.org Modint - http://directory.modint.nl/zoekaanbieder.asp
2.
Trade channels for market entry
Trade channels The most suitable trade channels on the Dutch woven outerwear market for exporters in DCs, are:
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
• domestic manufacturers; • wholesalers/importers, selling to retail organisations; • retailers, of which the larger players or buying groups of independents import by themselves. Which channel will be chosen, depends on factors like (among others): • Which type of woven outerwear producer (CMT, FOB, private label or own brand producer) tends to export to The Netherlands. These types of producer are described in chapter 1 and 2 of the CBI survey ‘Guidelines for exporting woven outerwear to the EU’. • The resources available and the priority given to the Dutch market. Domestic manufacturers Production has been discussed in chapter 1 of this survey and more general information can be found in chapter 2 of the CBI market survey ‘The woven outerwear market in the EU’. The large companies in the clothing sector as mentioned in the previous chapter have production activities abroad. The number of woven outerwear manufacturers is limited but opportunities exist for exporters, who are interested in forming relationships or partnerships with Dutch producers. The website of Modint’s directory gives information about the manufacturers of woven outerwear in The Netherlands http://directory.modint.nl/zoekaanbieder.asp Wholesale trade About 2,000 wholesalers, of which 800 are of considerable importance, are active in imports in The Netherlands in the clothing sector. A number of them is member of the FTGB (textiles wholesalers association). Information about them can be found on http://www.nvg.nl while another part can be found on the website of the NVKT (agents and importers of clothing and textiles) on http://www.nvkt.nl. There are different sales intermediaries active between industry and retail, as described in chapter 3 of the CBI market survey ‘The woven outerwear market in the EU’. An overview of brand names in the related segments of the clothing market can be found in chapter 1 (page 8 and 9). Examples of wholesalers in The Netherlands are, among others: Zantman Modegroep (http://www.zantman.nl), HMZ (http://www.hmz.nl), Jago (clothing accessories; http://www.jago.nl), Bodewes (http://www.bodewes.nl), Masita (sportswear; http://www.masita.com) and Lunter Textiel (http://www.luntertextiel.nl). Retail trade The clothing retail structure in The Netherlands differs greatly from those found in other major EU countries. Specialists face limited competition, mainly from department and variety stores and home shopping, while super- and hypermarkets play a minor role. The holding Maxeda (former name Vendex/KBB; http://www.maxeda.com) is the largest nonfood retailer selling fashion in the country and includes the department stores Vroom & Dreesman and Bijenkorf, the fashion multiples M&S Mode (women’s wear), Claudia Sträter (women’s wear) and Hunkemöller (body wear). Many Netherlands retail organisations have set up chains abroad: M&S, We Men/Women and Cool Cat are examples of internationally-oriented chains, just like variety chain Hema and textile discounters Zeeman and Wibra. There is an increasing number of outlets in The netherlands, mainly clothing multiples, including strongly expanding chains from abroad like Hennes & Mauritz (97 stores) from Sweden, Vögele Mode (115) from Switzerland, Vero Moda (80), Only (35) and Jack & Jones (60) from Denmark, Esprit (51 directly managed stores from Germany/Hong Kong), Benetton (200 stores) from Italy and Ulla Poken (36) from Germany. Other foreign retailers are rather small in The Netherlands, such as Zara (15) and Mango (10) from Spain and, Gant (12) from the USA.
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
Table 2.1 Market shares of retail distribution of outerwear in The Netherlands, 2004-2008, in % of value 2004 Specialists 70 Independent retailers 31 Clothing multiples 39 Non-specialists 30 Department and variety stores 8 Textile supermarkets 3 Sports speciality stores 3 Home shopping companies 5 Other 11 Total 100 Sources: GFK (2009) and CBS (2009)
2006
2008
69 29 40 31 8 3 3 5 12 100
69 27 42 31 7 3 3 6 12 100
Women 72 27 45 28 5 3 3 7 10 100
2008 Men 68 29 39 32 7 3 5 6 11 100
Children 55 19 36 45 12 10 3 8 12 100
In The Netherlands, there are around 10,700 outlets in the outerwear sector exploited by 6,400 companies, of which 60% can be classified as independent retailers. 40% of Netherlands independent retailers is organised in central buying organisations and, to a lesser degree, franchise organisations. The main operations of independent retailers lie in the middle and upper sections of the market. The leading buying organisations are Intres (http://www.intres.nl) and Euretco (http://www.euretco.nl). Intres has the following formula for woven outerwear: selling formula First Lady (32 women’s wear stores) and First Man (17 men’s wear stores), buying formula in men’s wear like Alpha (70 stores); in women’s wear: Ladies Department (26) and Forum (80); in children’s wear: Get Smart (60), Ministars (60) and AUB stores (25), and for sportswear: Intersport (120; http://www.intersport.nl ), Coach (58; http://www.coach.nl) and G.O.S Sport (independents operating under own name via almost 100 stores). Euretco Fashion is the owner of formula such as for sportswear: Sportpoint (140; http://www.sportpoint.nl) and Sport 2000 (111; http://www.sport2000.nl). Other (smaller) buying organisations are Hadac (25 members operating through 55 stores, higher segments of women’s wear; http://www.hadac.nl) and Deco (110 stores, higher segments men’s and women’s wear; http://www.decobrm.nl); The retail market for women’s outerwear has many players, while the number of chains in men’s outerwear and in the children’s outerwear sector is very limited. The following overview gives the important Dutch chains, operating in The Netherlands. Table 2.2 Major specialised clothing chains of Dutch origin in The Netherlands, 2008 Retail chain General clothing C&A Duthler We Men/Women Shoeby Fasion Cool Cat Men’s wear Adam Women’s wear Didi Fashion M&S Mode Miss Etam Promiss Steps Pulls SPS (Superstar) Witteveen Wonder Woman
Parent company
Website
C&A Brova WE Europe Shoeby Cool Cat Fashion
http://www.c-and-a.com http://www.duthler.com http://www.wefashion.com http://www.shoebyfashion.nl http://www.coolcat.nl
Mc Gregor Group
http://www.adam.nl
Coltex Maxeda Etam Groep Etam Groep NFD Van der Wijk Coltex Witteveen Cool Cat Fashion
http://www.didi.nl http://www.msmode.com http://etam.nl http://www.promiss.nl http://www.steps.nl
http://www.pulls.nl
http://www.sps-superstar.nl
http://www.witteveen-mode.com http://www.wonderwoman.nl
Number of outlets 125 30 122/226* 200 80/117* 52 118/141*) 137/402* 126 65 88 23 79 83/85*) 45
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
Retail chain
Parent company
Claudia Sträter Maxeda Leisure wear Forecast/Vet Coltex Jeans Centre Jeans Centre Newport Blue Newport Blue Score Score Group Children’s wear Villa Happ Villa Happ Nederland Babies’/maternity Prenatal Artsana Outdoor and sports Perry Sport CVC Aktie Sport Bron Beheer Bever Zwerfsport Bever Zwerfsport *) including outlets abroad
Website http://www.claudiastrater.com http://www.forecast.nl http://www.jeanscentre.nl http://www.newportblue.nl http://www.score.nl
Number of outlets 20/33* 60 81 32 66/81*
http://www.villahapp.nl
48
http://www.prenatal.nl
78
http://www.perrysport.nl http://www.aktiesport.nl http://www.bever.nl
51 151 32
There are two department stores of importance, namely V&D (http://www.vd.nl) and De Bijenkorf (http://www.bijenkorf.nl). Both are part of Maxeda Holding and both sell outerwear. De Bijenkorf has 12 stores and stocks high-quality, stylish and appropriately priced products. V&D operates in the middle of the market with 62 outlets of different sizes. The variety store Hema (Lions Capital) has 416 sales outlets, of which 62 are located in Belgium, 8 in Germany, 1 in France and 1 in Luxembourg. The Hema (http://www.hema.nl) claims to be the market leader in several product groups, among others, in babies’ clothing. All articles are sold under the private label Hema. Due to the extended network of retail shops in The Netherlands, home shopping has a much lower market share than most other EU countries. Mail-order houses operate via catalogues and Internet and in some cases tele-shopping, mainly in the middle ranges as regards price, quality and fashion. The most important companies are Wehkamp (http://www.wehkamp.nl) and Otto Nederland (http://www.otto.nl), part of Otto Versand from Germany. Several Dutch retail organisations operate also via Internet, mail-order and home shopping. Important discount chains in textiles (often indicated as textile supermarkets) are Zeeman Textielsupers with 1,050 outlets, of which over 500 are in The Netherlands, almost 250 in Germany, over 200 in Belgium, 60 in France and 11 in Luxembourg (http://www.zeeman.com), Wibra with 250 outlets, of which 166 stores are in The Netherlands and 84 in Belgium (http://www.wibra.nl), Hans Textiel & Mode (174 outlets; (http://www.hanstextiel.nl), Henk ten Hoor (84 outlets; http://www.henktenhoor.nl) and Ter Stal (173 outlets; http://www.terstal.nl). Most products under review in this survey are part of the assortment of the above-mentioned textile discounters. Discounters, which originally only sold footwear like Scapino (204 stores; http://www.scapino.nl), Bristol (128 stores; http://www.bristol-online.nl), have expanded their assortment to include outerwear, sportswear and bodywear. This example has been followed by other footwear discounters, like Schoenenreus (222 stores including Belgium and Luxembourg; http://www.schoenenreus.nl). The main activities of grocery supermarkets are in the provisions sector, however, super- and hypermarkets have (mainly low-priced) outerwear incidentally in their assortment. Supermarket chains are Albert Heijn (760 stores), Aldi (460 stores), Lidl (234 stores), Dirk van de Broek (91 stores), Deka Markt (85 stores), Deen (56 stores) and Vomar (54 stores). Clothing market shares of the originally-German Aldi and Lidl are highest. The category ‘Other non-specialized channels’ in table 2.1 includes the Makro, a cash-and-carry formula, part of the German Metro Group with 16 stores in The Netherlands. Makro is a wholesaler with retail activities. Besides Makro, this category also includes street markets and
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CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
factory outlets. Companies in this category (with the exception of the Makro) are not themselves involved in importing. Trends • The non-food offer in the groceries sector is limited in The Netherlands. The hypermarket format, with its strong non-food component, plays a smaller role in clothing sales than in the rest of the EU. However, a limited growth is expected for the coming years. • The specialist clothing sector in The Netherlands is becoming more concentrated. The leading buying groups: Euretco and Intres, of which most of the members are independent retailers, hold a strong position in the national market. • Most of the retail chains have expanded their activities abroad, mainly to Belgium and Germany. Price structure Nearly all of the above-mentioned retail organisations are active in the mid-market and/or lower-market segments. Chapter 1 of CBI’s market survey ‘The woven outerwear market in the EU’ gives an indication of differences in price levels, while an overview of margins valid for the various segments in the woven outerwear market can be found in chapter 3 of the same survey. Price is an important selling factor, especially in the lower segments of the market (variety stores, hypermarkets and discounters), whereas in the higher segments (higher added value) factors like quality and fashion are more important than price. In the lower segments of the market, retailers have little room to manipulate prices, because competition is very fierce and margins are low. Margins have been falling in The Netherlands in recent years, as a result of intense competition in the supply chain and an intensification of competition between retailers. Different margins and prices apply in each trade channel, with multiples of 2.1 up to 3.1 of the export (CIF) price as is shown in table 2.3. These margins will vary depending on which market segment is being approached. The higher the market segment, the higher the margins which can be reached. Table 2.3 Overview of margins in outerwear in The Netherlands Low High Importers/wholesalers' margins Agents' margins Retailers' margins Mark-up Export (CIF) price - Consumer price
30% 10% 35-40% 2.1
40% 15% 65% 3.1
Finding a suitable trading partner When trying to find a trading partner, the usual trade sources are an important point of contact. Another possibility for selecting potential trading partners is an orientation on the websites of branch organisations (as described above), such as Modint, FTGB and NVKT. The best place to meet potential trading partners is at a trade fair i.e. Modefabriek (http://www.modefabriek.nl) and Amsterdam Fashion Week http://www.amsterdamfashionweek.com), even though these fairs have a local and modest character. Another meeting point is a trade centre, such as the WFC (World Fashion Centre; http://www.worldfashioncentre.nl ) in Amsterdam. A list of exhibitors can be found at the trade fair and trade centre websites. Another possibility for finding potential trading partners is an orientation on Internet and/or consulting the general trade directories. More information can be found in the CBI manuals ‘EU marketing guidelines for woven outerwear’ and ‘Export Planner’. Useful sources: The Association of Dutch Chambers of Industry and Commerce - http://www.kvk.nl The Dutch Retail Council - http://www.raadnederlandsedetailhandel.nl
Source: CBI Market Information Database • URL: www.cbi.eu • Contact: [email protected] • www.cbi.eu/disclaimer Page 10 of 16
CBI MARKET SURVEY: THE WOVEN OUTERWEAR MARKET IN THE NETHERLANDS
3.
Trade: imports and exports
3.1 Imports Netherlands’ imports increased 6.5% (in terms of value) during the period 2004-2006 and fell 4.1% during the period 2006-2008. Imports amounted to € 2.6 billion or 5% of the total EU exported value in 2008. The Netherlands ranked seventh in EU woven outerwear exports behind Spain and Belgium, and above Austria. Average import prices fluctuated during the period 2006-2008: a fall of 4% in 2007 and a growth of 3% in 2008, mainly caused by the intensive competition, both at trade level and at suppliers’ level. Sources China and Germany (including re-exports) remained the leading suppliers of woven outerwear to The Netherlands. 48% of total imports came from these two countries in 2008, of which China 29% and Germany 19%. Other important suppliers came from Turkey (8% of total imports), Italy (6%), India (5%), Bangladesh and Denmark (each country 4%). Growing suppliers (exports valued more than € 25 million and a growth in imports) of woven outerwear during the period 2006-2008 were China, Germany, Italy, Denmark, Tunisia and Poland. In terms of value, 58% of imported woven outerwear came from DCs. In 2006, 56% of The Netherlands imports came from DCs and 50% in 2004. Main developments in area of origin of woven outerwear imports by The Netherlands in the period 2006-2008 were: • Total woven outerwear imports fell 4.0%. Imports from DCs grew slightly (+0.6%) mainly to the detriment of non-EU countries other than DCs (-49%), while imports from other EU countries stabilized; • Imports from leading supplier China increased by 15% to an import share of 29% of total imports, or 51% of total imports from DCs; • Imports from Asian DCs (except China) fell by 16% to a share of 14%, lower imports came from India (-10%), Bangladesh (-16%), Vietnam (-21%), Indonesia (-44%) and Pakistan (-2%), while imports from Thailand (+42%) increased; • Imports from Mediterranean DCs decreased by 5% to a share of 13%, caused by strongly reduced imports from Turkey (-13%) and Morocco (-28%) and despite higher imports from Tunisia (+18%) and Macedonia (+35%); • Imports from CEECs grew 18% to € 30 million, an import share of 1%, caused by higher imports from Ukraine (+77%) and despite lower imports from Belarus (-14%) and Moldova (-51%); • Imports from Central & South America fell 9%, mainly Brazil (-32%) and despite increased imports from Mexico (+149%) to a limited € 3 million in 2008; • Imports from ACP countries grew by 21%, caused by increased imports from Mauritius (+46%) to € 7 million in 2008. Imports from Mauritius covered 98% of total imports from ACP countries. Table 3.1 Imports of woven outerwear by and leading suppliers to The Netherlands in 2004-2008, share in % of value Total Intra-EU: Extra-EU ex. DCs: DCs:
2004 € mln 2,440 1,043
2006 € mln 2,683 1,053
181
122
1,216
1,507
2008 Leading suppliers in 2008 € mln (share of total imports in %) 2,632 1,054 Germany (19); Italy (6); Denmark (4); Belgium (3); Poland (2); France (2); Czech Republic (1); Spain (1). 62 Hong Kong (1); USA (
