Trends in China's Textile and Apparel Industry
While China’s textile market is experiencing a continually decline in revenues, the apparel market shows a much more dynamic development in terms of concentration, brands and customer preferences.
China Textile Industry
Revenues of China's textile industry has been declining from 386 billion CNY in 2017 to 227 billion CNY in 2020, resulting in a CAGR of -16%.
Drivers:
- With the increase of resident income, consumption upgrade, and implementation of China’s second-child policy, the demand for high-quality textile materials will remain increase.
- Technologies applied in design, manufacture, marketing, and logistics in the textile industry will accelerate the transformation from traditional manufacturing to a smarter and more defined mode.
- Chinese government is increasing efforts in the supply side reform and industrial upgrading, creating more opportunities for the development of textile industry.
Challenges:
- Impacted by Covid-19 and international trade conflicts, overseas market demand for tactile remains weak, and the stability of global supply chain is highly challenged.
- Chinese tactile industries are facing the challenges of increasing costs, stricter government environment policies, and more severe domestic competition.
- SEA countries are showing more attractiveness for textile manufacturers benefited by favorable market opening policies, investment inviting policies and lower labor costs.
China Apparel Market:
Within China, women's wear accounts for ~40% of the total apparel market, with men's wear making up 23% and sportswear 11%.
Women’s Wear: Women’s wear accounts for the largest market share while growth rate declines in recent years. The Concentration ratio (CR10 8.5%) is significantly lower than other segments impacted by fashion tendency, channel difference, and design.
Men’s Wear: China’s men’s wear market is still in the growth stage. Customers have gradually developed their brand awareness in this segment. Leading Chinese brands gain steady competitive advantages (e.g. HLA); Market share of International brands are also increasing (e.g. adidas & Uniqlo).
Sportswear: Sportswear market has highest growth rate (19.5% in 2018), far above industrial average with huge future develop potential. Highly concentrated compared with other segments (CR10 81%) dominated by both leading international brands (Nike & adidas) and Chinese local brands (Anta & LiNing).
