More expensive tops, sweaters and pants in 2022?
Like many sectors at the end of the year, clothing could also be affected by inflation in the months to come.
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This is what the Institut Français de la Mode (IFM) provides, which asks 100 brands and retailers every month, in particular on the evolution of their prices. In October, 49% of respondents predicted an increase in their selling prices from 0 to 5% in 2022 and 9% an increase between 5 and 10% (or 58% who intend to increase their prices from 0 to 10%). Conversely, 34% expect to leave their prices stable.
“It's a question of strategy. Some may decide to lower their margins when for others they are already too low. It also depends on the price range. For those who are positioned on first prices, it is more difficult to increase them ”
, explains Gildas Minvielle, director of the IFM economic observatory.
For an item at 9 euros, going above the 10 euros mark can indeed have a negative impact on consumers looking for a good deal.
Especially since an increase of 5% would be higher than the inflation that France is currently experiencing.
According to INSEE, it reached + 2.6% in October against 2.2% in September.
Rising raw material costs
Like many other sectors, clothing suffers from a combination of negative factors, starting with rising raw material costs.
The price of cotton has thus reached peaks never seen since 2011. Wool is also following an upward trend, as is oil, from which textiles are in great demand to manufacture its synthetic fibers.
The increase in the prices of freight, the transport of goods, also weighs on the prices of clothing.
“These two elements combined have a very strong impact
,
”
confirms Gildas Minvielle.
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Beyond the expected in-store inflation, the increase in the costs of raw materials and freight have also led professionals to review their places of supply. If Asia, led by China but also Bangladesh, Vietnam and Cambodia, until then appropriated 70% of imports into Europe in the sector, the latter now more readily opts for countries like Morocco, Tunisia and Turkey to supply themselves. Already among clothing customers, these countries are gradually strengthening their place, says the economist. "
While it is still cheaper to source from Asia, distributors are aware that by turning to southern Europe, they are taking less risk: they can place their orders less in advance and thus better assess the number of parts needed and avoid ending up with unsold items,
”he explains.
No turning back
A solution which shows the adaptability of the sector but which should not reverse the upward trend in stores. Only the optimistic outlook of the European Central Bank, which forecasts temporary inflation, allows us to be optimistic.
"The measures of core inflation"
, that is to say excluding volatile prices of energy and raw materials,
"are moving in the right direction,"
said its president, Christine Lagarde, at the time. of a finance conference in Frankfurt on November 19. Even if this scenario were to materialize, the prices on the racks would not fall for all that, concludes Gildas Minvielle: “
Once they have increased, the increase is confirmed and itis difficult to go back
".