Global market review of workwear - forecasts to 2019 - 2015 edition
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Global market review of
workwear – forecasts to
2019
2015 edition
iGlobal market review of
workwear – forecasts to 2019
By Malcolm Newbery
2015 edition
April 2015
Published by
Aroq Limited
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iiiTable of contents
Executive summary ............................................................................................................. 1
Characteristics of the workwear market .................................................................................................... 1
Calculation methodology for the workwear market ................................................................................... 2
Value and volume (units issued) of the workwear market, 2014 ............................................................... 2
The historical period 2009 to 2014 ............................................................................................................ 3
The forecast period 2015 to 2019.............................................................................................................. 3
The workwear supply chain is different to normal clothing ....................................................................... 4
Mergers and takeovers .............................................................................................................................. 5
The state of the garment rental industry ................................................................................................... 5
The state of the fabric industry .................................................................................................................. 5
The state of the manufacturing industry ................................................................................................... 7
Major players in direct sales, garment rental and fabric weaving ............................................................. 7
Chapter 1 Characteristics of the workwear market................................................................ 8
Nature of the workwear market ................................................................................................................. 8
Corporatewear product types .................................................................................................................... 9
Corporatewear product definitions ............................................................................................................ 9
Route to market approaches ................................................................................................................... 11
Employment............................................................................................................................................. 12
Chapter 2 Calculation methodology for the current 2014 workwear market ........................... 13
World workwear value of garments sold per year at wholesale prices .................................................... 13
World workwear value by sector and sales channels............................................................................... 15
Chapter 3 The current workwear market, in volume and wholesale value .............................. 17
Overall size of the world market .............................................................................................................. 17
Geographic breakdown of the workwear market by continents............................................................... 18
The workwear market in volume by continental regions ......................................................................... 19
The workwear market in value by continental regions ............................................................................ 20
The workwear market in value by sales channel ..................................................................................... 21
The workwear market in value by region, product category and route to market................................... 23
Current trends in products and routes, using the UK as an example....................................................... 26
Chapter 4 Six years of history, five years of forecasts .......................................................... 28
Six years of history, 2009-2014 ............................................................................................................... 28
Five years of forecasts ............................................................................................................................. 29
The just-style timeline ............................................................................................................................. 31
Longer term history and forecast trends ................................................................................................. 31
Chapter 5 Supply chain issues ............................................................................................ 33
Why the workwear supply chain is different ............................................................................................ 33
Total contract management and tenders ................................................................................................ 34
Catalogues ............................................................................................................................................... 35
Rental ...................................................................................................................................................... 37
Mergers and takeovers, why so many?.................................................................................................... 37
Mergers and takeovers in North America and Western Europe, a potted history .................................... 38
Chapter 6 The state of the garment rental industry ............................................................. 41
ivExplanation of garment rental ................................................................................................................. 41
North American statements about the garment rental industry .............................................................. 42
European statements about the garment rental industry........................................................................ 43
The advantages of rental, according to its protagonists .......................................................................... 45
Chapter 7 The state of the fabric industry ........................................................................... 46
The fabric comes first .............................................................................................................................. 46
Fabric characteristics, common workwear and protectivewear attributes .............................................. 47
Fabric performance characteristics.......................................................................................................... 48
Water proof or water resistant ............................................................................................................ 48
Windproof and thermal........................................................................................................................ 49
Breathable ........................................................................................................................................... 49
Anti-stain ............................................................................................................................................. 49
High visibility ....................................................................................................................................... 49
Flame retardant................................................................................................................................... 50
Protection from the Sun ...................................................................................................................... 50
Cuts and abrasion ............................................................................................................................... 50
Clean room and anti-static .................................................................................................................. 50
Multifunctional fabrics ......................................................................................................................... 51
Nanotechnology .................................................................................................................................. 51
Chapter 8 The state of the manufacturing industry .............................................................. 52
Workwear apparel manufacturers ........................................................................................................... 52
World manufacturing by sub-regions for continental marketing regions ................................................. 52
Chapter 9 Major players in direct sales, garment rental and fabric weaving .......................... 55
Marketing, both direct sales and garment rental ..................................................................................... 55
Fabric weaving ......................................................................................................................................... 57
Chapter 10 A summary of workwear trends ......................................................................... 58
vList of tables
Table 1: 2014 workwear market calculations by continental region (values, volumes and garments per worker) .................. 13
Table 2: 2014 workwear market by continental region and sector within (values and % share by sales channel).................. 15
Table 3: 2014 workwear market by continental region and sector within (units and % share) ............................................... 19
Table 4: 2014 workwear market by continental region and sector within (average wholesale prices and sector values) ....... 20
Table 5: 2014 workwear market by continental region and sales channel within (% share and values) ................................. 21
Table 6: 2014 workwear market by continental region and sector within (sales value by sales channel) ............................... 23
Table 7: 2009-2019 workwear market value by continental region (% and indexed change) ................................................. 28
Table 8: 2009-2019 workwear market volume growth by continental region (unit growth) .................................................... 29
Table 9: 2009-2019 workwear market by continental region (US$m value and average price per year, % CAGR) ................. 31
Table 10: 2009-2019 workwear market by continental region (millions units per year, % CAGR) ........................................... 31
Table 11: European rental market in EURbn by area, 2012 ..................................................................................................... 45
Table 12: 2014 sales of workwear in continental regions by manufacturing source location (% share and volume) .............. 53
Table 13: Major players, North America ................................................................................................................................... 55
Table 14: Major players, Europe ............................................................................................................................................... 56
Table 15: The pan-product, pan-industry offer......................................................................................................................... 56
List of figures
Figure 1: Customer service and stock ...................................................................................................................................... 36
viChapter 1 Characteristics of the workwear
market
Nature of the workwear market
In this report’s title, reference to “workwear” is meant any garments:
that are worn to work;
because they have been bought for the wearer to use for work.
This means that the decision-making process is taken by the employer, not by the employee. The
decision could be taken for any of, and frequently for more than one of:
identification reasons, to be recognised as belonging to a group;
comfort at work reasons, to operate well by feeling good;
smartness at work reasons, to look right for the job;
health and safety at work reasons, to avoid injury;
company image projection reasons, to convey a corporate image.
It is therefore the employer who decides what the workers will wear. That decision process has
been at the heart of the corporatewear industry (to give workwear its more business like name) for
nearly fifty years. For 25% of the adult employed population of the developed countries of the
world, what we wear to work is what our employers have given us.
The workwear industry is also predominately a B2B, business to business transaction. A few
garments are sold to individuals privately, but because the purchasing decision is taken by the
employer for the employee, merchandise is sold at wholesale prices to companies or rented by
them from garment rental companies that launder the garments on a “revolving” basis (one on the
wearer, one in the locker, one at the rental laundry).
It was not always that way. Historically, and before the industrial revolution, workers clothed
themselves for work. During the industrial revolution, some workers began to be given very basic
protective workwear such as bibs, aprons and tabards.
1Chapter 2 Calculation methodology for the
current 2014 workwear market
World workwear value of garments sold per year at
wholesale prices
The previous 2013 edition of just-style’s workwear report concentrated on product types. This
edition uses product types, but concentrates more on the split by route to market. This is important
because companies or the divisions of large multinationals tend to concentrate their buying
methods on one or two of the five routes to market explained in Chapter 1.
Consequently, the methodology can be demonstrated in Tables 1 and 2 which are given below.
Table 1: 2014 workwear market calculations by continental region (values, volumes and garments per worker)
North South Rest of the World
Basis for estimate Units America Europe Asia America World total
Population millions
Adult population % %
Adult population millions
Proportion employed %
Adult employed population millions
% given workwear %
Workwear wearers millions
Number of garments per wearer per year units
Garments issued per year millions
Average value of garment (wholesale price) US$
Wholesale value of corporatewear market US$ millions
Source: just-style
This table and all the subsequent tables are created using the methodology explained towards the
end of Chapter 1. That is to say, it is a calculation which develops:
from the population to the adult population;
from the adult population to the employed adult population;
from adults employed to workwear wearers, via the percentage of employees given
workwear;
from wearers to garments via the number of garments issued per wearer per year;
from the garments to the market value, via the average wholesale price per garment.
2Chapter 3 The current workwear market, in
volume and wholesale value
Overall size of the world market
The value of garments sold either to end user companies and institutions to be worn by their
employees, or sold to garment rental companies is just under US$XXbn. This figure is considerably
lower than the market size given in the 2013 edition. There are two reasons for this.
The first reason is that, in that edition garment rental income from laundering garments was
included. The reason why laundry income has been excluded is that the financial figures for
laundries include the rental and laundry income for a whole series of non-apparel products such as:
flat table linen and napkins for restaurants and hotels;
bed linen for hotels and hospitals;
washroom products such as hand wiping rolls.
The second reason is that this report excludes non-textile based PPE (personal protective
equipment) products such as:
hard hats;
eye and ear protection;
protective work boots.
This report excludes them, because it is intended to provide garment makers and sellers of
workwear with a clear picture of the scale of the industry they are either making for or selling into.
The report follows the principles of the original report written by the author for the British Clothing
Industry Association into the workwear market in 1989.
3Chapter 4 Six years of history, five years of
forecasts
Six years of history, 2009-2014
As is our normal practice at just-style, we take a long term view of clothing sectors. The view back
from 2014, which we have taken as the current year, to 2009 coincides with the aftermath of the
banking financial crisis of 2007-2008, which had an impact on every apparel sector. People’s
personal spending was adversely affected. This knocked on into fashion retail where many
companies suffered heavily in terms of both sales and gross margins. This lead to reductions in the
volume of purchase orders which adversely affected manufacturing in low cost countries. It also
filtered through to the business clothing sector where many companies either cut their spending
budgets on the employee wardrobe, or simply demanded lower prices from their workwear
suppliers. These cutbacks were the complete antithesis to the heady days of the 1990s, when
image was everything and companies were prepared to splash the cash to outfit their staff in
clothes incorporating house fabric colours, logos and other forms of embellishment. The recession
lead to heavy consolidation in the industry, a subject considered further in Chapter 5.
As Table 7 indicates, the world workwear market, measured in value, stagnated from 2009 to 2014
with a nominal decrease in US$ value of XX%. From its high of 2007, it actually fell by about XX%.
Table 2: 2009-2019 workwear market value by continental region (% and indexed change)
North South Rest of the World
Growth expressed as percentages: America Europe Asia America World total
2009-2014
2014-2019
Growth expressed as an index, where 2014
=100:
2009
2014
2019
Source: just-style
The developed world of North America and Europe bore the brunt of the recession. The dollar value
of the market fell by XX% in both continents. The other continents of the world experienced
growth, with the Rest of the World enjoying a catch up boom, as businesses started to follow the
developed world trend for outfitting employees. However, it has to be remembered that growth in
this region was from a very small base.
4Chapter 5 Supply chain issues
Why the workwear supply chain is different
As explained in previous chapters, the workwear clothing sector is a business to business (B2B),
not a business to consumer (B2C) transaction. This makes the management of the supply chain
completely different from that of “normal” clothing sold to consumers either in physical shops or
on the internet.
In the “normal” consumer clothing supply chain, there is no obligation to promise to provide
continuity. The merchandise supply chain is driven by a number of business decisions. They are:
make a sales forecast, usually for a season;
place a purchase order, either for the sales forecast quantity, of for somewhat more or
somewhat less units;
receive the purchase order, and either allocate it to shops, or make it available to
consumers on the internet;
this last requires a conscious decision, as to the quantities held for both consumer routes,
whether they are held separately or in one “pot of stock”, about who gets priority if there is
a stock shortfall against consumer demand;
accept consumer purchases and watch the stock reduce;
if it sells well, either try to reorder (may not be possible because of the time constraints), or
let it sell out;
if it sells badly, mark-down and take a reduced margin;
if it sells very badly, send it to outlet (mark-down) stores, move it to a different part of the
world, or job it off (sell very cheap to T K Maxx or even Poundland);
move on to new merchandise (something different).
Workwear is different. Because a promise has been made to a business to business customer to
provide clothes to be worn at work over a period of time, the supplier has to ensure continuity of
merchandise in stock, in order to:
replace worn out garments;
5Chapter 6 The state of the garment rental
industry
Explanation of garment rental
Garment rental is an extremely important channel for workwear and hence requires further
explanation. Many of the biggest companies “selling” workwear are in fact renting it to the
industrial companies that are giving it to their staff to wear. The logic of this is that the rental
companies are in fact laundries, or as they call themselves in today’s management speak
“garment rental service providers”. They buy the workwear from clothing manufacturers, and rent
it to their clients by the week. The rental fee usually includes a laundry service, which involves:
collecting soiled workwear from the employee’s place of work;
cleaning it at the laundry;
returning the garment (but not necessarily the same one that was collected) to the wearer.
The principle is sometimes referred to as:
one on the back;
one at the laundry;
one in the locker.
The use of the word locker provides a clue as to the historical target market and the unique selling
proposition of the garment rental industry. The target market was heavy industry, where
employees worked in one location, and where the prime purpose of the garment was function.
Protection mattered to a degree, but there was no need for image as the employees were not
customer facing.
6Chapter 7 The state of the fabric industry
The fabric comes first
In the previous chapter, a direct quote was made from Frost and Sullivan to the effect that fabric
developments offered the best chance for workwear providers to create interest and growth in
their industry. This comes in an environment where there is a lot of interest in fabric developments.
Some are connected with health and safety. Some have their roots in performance. Some combine
the two.
For fabric innovation, the best long term trend information comes from the industry leader
Klopman. Although Klopman has many fabric brand names, most of them are just poly/cotton in
different combinations and/or weights, or with chemical properties such as flame retardancy
added. Klopman’s greatest achievement has been to get garment rental companies to specify
Klopman fabric to the garment factories making for them. Within that overriding marketing
approach, fabric developments have been:
1960s Development by Klopman, in conjunction with DuPont, of the first polyester-
blended fabric for industrially washed workwear, a 65% polyester/35% cotton;
1970s Various poly-cottons prove to have better laundering properties than 100% cotton
and are taken up by garment rental laundries;
1980s Cotton rich fabrics introduced which provide the feel and comfort (especially the
heavy ones) of cotton, with the laundering benefits of the blend;
1990s Klopman separates its fabric brands into three divisions; image workwear,
protectivewear and casual apparel, thereby admitting that they perform better in different
types of garment;
2000s Klopman introduces stretch poly-cotton, and business fabrics for careerwear;
2010s More fabrics with special properties developed, anti-static, liquid chemical splash,
antimicrobial, odour-defence.
7Chapter 8 The state of the manufacturing
industry
Workwear apparel manufacturers
Manufacturers used to be the controlling part of the supply chain in the workwear and
corporatewear industry. As explained in earlier chapters, that is no longer the case. As the various
phases of consolidation took place in this mature garment sector, the leading role shifted from
manufacturing to contract account management or to rental service providers. This happened at
the same time and was connected with the gradual erosion of manufacturing capacity in North
America and Europe, which moved production towards low cost manufacturers in Turkey, North
Africa, India and China.
just-style now believes that there are at least 1000 “meaningful” (large) corporate and workwear
garment manufacturers in the world. Most of them are in Asia. Most of them are anonymous. No
one outside this business to business sector even knows their names.
The major way in which industry has changed over the last six to eight years is that manufacturers
are merely intermediaries (although they can be seriously profitable ones) between either direct
marketers and their industry customers, or garment rental companies, and their fabric suppliers.
World manufacturing by sub-regions for continental
marketing regions
Table 12 takes the 2014 consumption figure in millions of garments from Table 1. Because it is
impossible to estimate, it ignores any changes in stock held, and assumes that consumption equals
production. Figures are then derived for the % of production that comes from each of the major
workwear manufacturing sub-regions that are delivered into the marketing continents.
8Chapter 9 Major players in direct sales, garment
rental and fabric weaving
Marketing, both direct sales and garment rental
In contradistinction to manufacturing, which is disparate, the situation for contract management
and for garment rental is completely different, and dominated by a few large players. These major
companies are still in control of the workwear sector, even if downwards price pressure has made it
very difficult to make attractive or even reasonable profits over the last five years.
In addition, the various phases on consolidation referred to in Chapter 5 mean that there are fewer
of them than there were ten years ago. The predatory instincts of private equity capital investors,
turn around specialists, and industry opportunists mean that the number of serious players is
slowly but steadily diminishing.
Tables 13 and 14 list the major players (marked as coloured cells) in the direct and rental business
for both North America and Europe. The list has been compiled, based on each of them holding at
least XX% of their respective markets in the route in which the company is specialised.
Table 3: Major players, North America
Company Direct sales Garment rental
Cintas
Angelica
Carrharrt
Dickies
Ideal
Delta
Crown
Source: just-style
9Chapter 10 A summary of workwear trends
Many trends have been identified, explained and predicted in this edition of just-style’s workwear
report. They can summarise as:
the use of product sub-divisions no longer adds any value to the industry analysis;
routes to market are now the best approach to defining and explaining the industry;
the industry has been XX over the period 2009 to 2014, with both North America and
Europe feeling the effects of global recession;
the industry will XX in the period 2015 to 2019, but Europe will be the XX player. This is as
a consequence of both a XX population and XX unemployment persisting in many Eurozone
countries;
supply chain, concerning continuity of product and stock management will continue to be
the major issue for management;
however, there are signs of a return to creativity in both design and the manner of
marketing to the industry’s customers;
consolidation, in the form of M&A activity has reached the “last man standing” strategy
stage;
but there is a lot of interest in fabric development which new technologies are driving;
the rental industry remains a conundrum;
manufacturing no longer drives the industry. It is now just a service which can be obtained
anywhere in the world;
as a consequence manufacturing is now strongly concentrated in Asia. It will never come
back to either North America or Europe;
the major players have now adopted, and will continue to pursue a “something for
everyone” offer strategy;
this industry is not just mature. It is showing the symptoms of advancing age.
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