The market for men's clothing - Germany

1.2 A globally growing market

Global sales for men's ready-to-wear clothing are expected to reach*** billion euros in **** estimated. The market is expected to grow at a CAGR (***) of*,*%until ****. This year, the global market volume is forecast to be around €***.** billion.

Global Menswear Market Worldwide, **** - ****, in billion euros Source: ****

The USA represents the strongest market for menswear in terms of sales, followed by China, India and Japan, as well as the UK in *th place. In an international comparison, Germany is in *th place, followed by Italy in *th place. It is clear here that these nations play a significant role in the market for menswear, although there is a clear discrepancy between the two leading markets of the USA and China on the one hand and India in *rd place on the other.

Top * nations with the highest sales for men's apparel Worldwide, **** - ****, In billions of euros Source: Statista The global reputation of German ready-to-wear is underlined by the fact that one of the top ** brands in the world is from Germany: Adidas. In addition to this renowned brand, Prada, Valentino, Dior, Moncler, Bottega Veneta, Fendi, Miu Miu, Off White, Burberry, Loewe, Versace, Diesel, Rick Owens, Saint Laurent, Nike and Alexander McQueen ...

1.3. German market records slight growth

The German menswear market is a significant sector of the textile industry. Demand for high-quality menswear in Germany is high and the range of products on offer is correspondingly broad. In ****, like many others, the industry experienced a decline in sales due to the global COVID-** crisis. However, the industry quickly recovered from this and was able to generate sales of €**.* billion in ****, an increase of **.*% compared to ****.

Menswear sales in Germany Germany, **** - ****, in billion euros Source: ****

In many industries, increasing globalization in recent decades has led to a relocation of production facilities abroad in order to be able to produce more cheaply. The German clothing and textile industry has been particularly affected by this.the significant decline in German textile and apparel production can essentially be attributed to the fact that many companies have either moved their production abroad (***), according to the Status of German Fashion ****.

Although German clothing brands have a good reputation worldwide, many production facilities have been relocated abroad since the ****s for economic reasons and - unlike other manufacturing industries - these have not been relocated back. The following chart shows the significant decline in gross value added in the apparel industry between **** and **** in ...

1.4 International trade

The main business partners of the German textile and clothing industry are mainly to be found within the European Union, with around **% of the total export value going to these member states. The second most important market is other European countries and Asia. The import of textiles in Germany comes mainly from Asia with a share of over **%, followed by the member states of the European Union and other European countries. Important supplier countries for the German market are China, Turkey and Bangladesh in addition to the EU member states.

Compared to other countries, Germany is the third largest exporter of textiles after China and India in terms of value. When it comes to importing textiles, Germany ranks fourth behind the U.S., Vietnam and China[***].

The following statistics show the domestic and foreign sales of apparel companies producing in Germany. This excludes pure traders and non-producers.

Trade balance of German companies on the world market Germany, **** - ****, in billions of euros Source: ****

The fashion and apparel sector generates about one-third of the industry's revenue. A high export ratio underlines the recognition of German products on the global market and emphasizes the competitiveness of companies.

However, it also shows a slight ...

2.1 Men's clothing is a large part of the clothing industry

above-average purchasing power in Germany

In **** , the price-adjusted disposable household income per inhabitant:in in Germany is **,*** euros[***].

Household income and purchasing power Germany, ****, in euros Source: ****

consumer spending on

declining

German market

most important

Consumer spending by private households on clothing and footwear Germany, **** - ****, in % Source: ****

Although German consumers continue to buy a lot of clothing, they spend less money per item of clothing on average in a European comparison. In ****, average spending by German consumers on clothing amounted to *** euros. Although this puts them above the European average of *** euros, compared toother nations, Germans spend less on fashion. Luxembourg (***), for example, recorded higher spending on clothing.

Expenditure on clothing Germany, ****, in euros Source: ****

2.2 Google Trends analysis

The analysis of Google Trends provides interesting insights into consumer behavior and demand for specific products. Particularly with regard to men's clothing, it shows that this is in demand all year round, with only a slight seasonal dependency. However, there is evidence that men tend to be more interested in fashion and clothing in the summer, which was reflected in an increase in searches in June and July ****.

This observation could be due to a combination of factors. For one, many people have more free time in the summer and spend more time outdoors, which could motivate them to update their outfits. For another, there are also many occasions during this time of year, such as weddings, parties or festivals, that require a new wardrobe.

Google Trend Analysis over the course of the year Germany, **** - ****, index base *** Source: ****

Values indicate search interest relative to the highest point in the chart for Germany in the specified time period. The value *** represents the highest popularity of this search term. The value ** means that the term is half as popular and the value * means that there was not enough data for this term.

2.3 The buying behavior of men

A survey of more than *,*** consumers by the fashion association Deutschland German Fashion showed that almost a third of people in Germany have no interest in fashion trends. This is also reflected in their buying behavior. The survey shows that **% of men surveyed are not interested in fashion trends and fashion, while this is the case for **% of women[***]. However, it is also important to remember that buying behavior is not solely dependent on interest in fashion trends and that many factors play a role when it comes to what clothes and accessories are purchased. For example, quality, comfort or practicality can be important decision-making criteria. Men, for example, are more likely to be ''must-have'' shoppers and buy their clothes as needed, while the majority of women are pleasure shoppers and like to store for the shopping experience: Pleasure versus must-have when buying clothes Germany, ****, in % Source: KPMG The study also shows that men are more determined when it comes to stationary shopping and buy their clothes in a targeted manner. Women, on the other hand, prefer to stroll:

Behavior in stationary clothing shopping Germany, ****, in % Source: KMPG An interesting behavioral pattern among men is their tendency to place more value ...

2.3 Sustainability

Although fashion production and consumption are high, customers are increasingly paying attention to sustainability when shopping. A recent survey by McKinsey shows that more than **% of consumers said that a brand's sustainability record was important when making purchasing decisions. Consumers are paying attention to all aspects of sustainability, from supply chain to packaging, but especially to materials, which should be produced as sustainably as possible.

Buyers pay attention to the following factors:

Reducing emissions, waste and volume Recycling of old clothing Refurbishing old clothing Reselling Lending Repairing instead of throwing away

As a result, there is an increasing trend in second-hand products, which will be explained in the next chapter.

A survey on the relevance of sustainability in the purchase of men's clothing showed that, on the one hand, sustainable and environmentally friendly production is important to customers; on the other hand, consumers are only slightly willing to pay a higher price for it and continue to prefer fast-fashion products[***].

Survey on sustainability in clothing purchases Germany, ****, in % Source: ****

2.4 Second hand in trend

As German consumers become increasingly aware of sustainability issues, the popularity of second-hand clothing is growing, as is the number of second-hand stores. Second hand includes clothes that have already been worn but are still in good condition. The concept behind this is to live more sustainably by buying clothes that have already been worn to provide an alternative to the production of fast fashion.

The following survey results offer an insight into the demand behavior for second-hand products:

Second Hand Shopping Germany, ****, in % Source: ****

**% of

once a year

How often do you buy second hand clothes? Germany, ****, in % Source: ****

According to a survey conducted by the online second-hand retailer momox Fashion, the motivation for buying second-hand clothing is the low price and sustainability.

Motivation for Second Hand Germany, ****, in % Source: momoxfashion The survey also revealed that second-hand clothing is most often purchased online:

Places to buy second hand clothing Germany, ****, in % Source: ****

The following factors are cited as reasons: What makes second hand clothing shopping online so attractive? Germany, ****, in % Source: ****

3.1 Value chain

The production of menswear makes a major contribution to the value chain in Germany:

Contribution of the German fashion industry to gross value added Germany, ****, in % Source: ****

Textile supply and production chains are highly complex and globally ramified. For example, a simple shirt for men goes through around *** production and delivery stages, including logistics. Companies from different countries around the world take part. The result is a long value chain that can also include recycling.[***]

Because many processes are involved and a large number of players are involved, the fashion and textile industry is very susceptible to global crises such as the Covid-** pandemic. For manufacturing companies in the industry, this poses a risk to cash flow, as well as to the delivery of goods. A survey conducted by the Better Buying Institute in March **** with *** manufacturing companies identified the following supply chain issues in times of crisis:

Impact Covid-** on manufacturing supply chains Worldwide, ****, in % Source: ****

3.2 Challenges of the textile industry

The information portal Fashion Network reports: The entire textile industry faces major challenges in ****. On the one hand, there is a vulnerable, branched value chain as described in the previous chapter; on the other hand, companies producing in Germany are facing rising production costs. The rising costs pose challenges in the following areas:

Higher costs for raw materials and materials Higher freight costs Rising energy prices

Nevertheless, the biggest cost items in the apparel industry are labor costs and material consumption, which together account for just over **% of production costs.

Cost structure in the German apparel industry Germany, ****, in % Source: ****

3.3 Direct and indirect sales

As discussed in Chapter *.* (***), consumers of men's clothing prefer good quality brands on the one hand, but therefore do not want to spend a lot of money. It is therefore necessary to find a suitable distribution structure. A distinction can be made between indirect and direct distribution channels, whereby indirect distribution does not involve selling directly to the end customer but to distribution partners.

Due to the competitive situation, direct sales are also gaining in importance alongside indirect sales channels. Although direct selling incurs higher fixed costs and requires greater management effort than indirect selling, it nevertheless offers some advantages. In direct selling, sales are handled by the company's own sales department.

3.4 Desire for omnichannel

In the future, brick-and-mortar retail and online retail will be increasingly linked, as many customers use both channels. They often search for products in the store and are happy to receive advice from staff before ultimately making purchases online. It is important to recognize that online and offline sales should not compete against each other, but must complement each other to provide customers with a seamless shopping experience[***].

In response to the question: ''I welcome retailers combining brick-and-mortar and online stores - with offers such as in-store pickup, ordering sold-out merchandise, home delivery, etc.'', respondents split by male and female answered as follows:

Desire for omnichannel concepts Germany, ****, in % Source: ****

The fact that the majority of men prefer omnichannel concepts correlates with the results from the survey in Chapter *.*, which show that men often prefer branded products. Men's clothing shoppers in particular want to purchase a quality product that is both inexpensive and time-saving.

4.1 Product typology and prices

The following table gives an overview of the main products available on the market for men's ready-to-wear.

The consumer price index measures the average price development of all goods and services purchased by private households for consumption purposes[***]. The consumer price index for the men's ready-to-wear clothing market shows significant price volatility between **** and ****. Over the past ** months, the consumer price index has consistently been above ***, reaching its maximum in February ****.

Consumer Price Index Menswear Germany, ****, Index Source: ****

4.2 Players on the market

The biggest brands and retailers with men's clothing in the range

Source: ****

Players on the market for second hand clothing

While second hand stores in stationary trade are mostly smaller, owner-operated or financially supported stores, there is a wide range of large second hand stores in the field of e-commerce. Online second hand stores in particular have experienced significant sales growth in recent years and have been able to generate record profits during and after the Covid-** pandemic[***].

5.1 Supply Chain Act

Supply Chain Act (***) - Act on corporate duty of care in supply chains

Since January *, ****, the Supply Chain Act (***) has been in force in Germany, which for the first time regulates corporate responsibility for the observance of human rights in supply chains. The law affects German companies that employ more than *,*** people and applies to all industries and sectors. The aim of the law is to ensure that companies pay attention to compliance with human rights and environmental standards in their supply chains. To this end, affected companies must introduce risk management and regularly monitor their supply chains to prevent violations of human rights and environmental degradation. Fines can be imposed for violations of the LkSG requirements. Companies must also regularly report on the implementation of their measures to comply with human rights and environmental standards in their supply chains and publish these reports. The LkSG aims to strengthen companies' responsibility for their supply chains and combat human rights violations in global supply chains.

Here are the key paragraphs:

§*: Scope of application The law applies to German companies that employ more than **** employees*. It applies to all industries and sectors of the economy.

§*: Requirements for companies The companies concerned ...

6.1 Segmentation of the players

• OLYMP
• Wormland
• Breuninger
• Hugo Boss
• Görtz Retail