Spending on apparel and footwear continued to slow in April, up just 2.7 percent from the same month last year marking the fourth consecutive month of decline. These were the findings of the latest report from Coresight Research, that also predicted growth would continue to slow with demand expected to “fully fade away in 2023.”
“I believe, by the end of this month, the new data will show continued low single digits or flat growth in consumer spending on apparel and footwear,” Sunny Zheng, senior analyst at Coresight, told Sourcing Journal.
March saw apparel and footwear spending grow by 3.0 percent vs. 2022, February by 4.7 percent and January by 5.7 percent. This 2023 decline comes after an explosive 2022 of purchasing capped in December when sales jumped by 6.8 percent.
“Last holiday was pretty good for apparel and footwear,” Zheng said. “The pent-up demand started early, like June of 2020 and lasted for almost two years. Now we see the demand start to fade away.”
The decline continues even as inflation continues to drop from a March 2022 peak of 6.7 percent, the highest since 1981, to 3.6 percent in April.
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“Inflation continues to squeeze consumer spending power, but that doesn’t mean that [consumers] will limit their spending,” Zheng said, adding that she predicts a mild recession in the second half of the year. “Brands such as Levi’s, Adidas and Skechers are already seeing their sales down for the first quarter because of softness in the wholesale channel in the U.S. and also softening demand in other geographies.”
Men’s wear outperformed women’s wear and children’s wear in April, coming in at 4.1 percent growth, 1.2 percent above the overall rate. It’s a performance Zheng attributes to resilient demand for denim jeans, luxury T-shirts and casual blazers. Men’s wear’s year-over-year growth peaked last September at 8.6 percent.
Year-over-year footwear spending growth fell under 2 percent for the second straight month, coming in at 1.6 percent in April and 1.8 percent in March.
“Overall for this year, I expect total consumer spending to decline by 2 percent—that’s not a big decline,” Zheng said. “It’s not something that apparel brands and retailers would worry about.”