Industry Analysis & Industry Trends
The economic recession has had a dismal effect on men's and boys' apparel wholesalers. With decreased discretionary spending in 2008 and 2009, retailers have been offering discounts to consumers to retain sales. Due to weak downstream demand, wholesalers were left with excess inventories and slashed prices to move stock. In their ongoing quest to cut expenditures and sustain margins, retailers have been sourcing directly from manufacturers, causing wholesalers to cut prices to remain relevant in the apparel supply chain. Meanwhile, due to cheap foreign labor, retailers are enticed with low-cost imports. As a result, wholesalers are left with lower demand... purchase to read more
Industry Report - Industry Investment Chapter
Capital investment has been rising because of advances in computer systems and technology, such as radio frequency identification and extensible markup language, designed to monitor inventory levels and reduce downtimes in the supply of clothing to retailers. IBISWorld estimates that for each $1.00 spent on wages, industry operators will spend $0.04 on capital. While this is indicative of a low level of capital intensity for the overall industry, larger wholesalers can spend up to $0.6 on capital for every dollar spent on labor.
Over the past five years, capital intensity has been rising; in 200, for every $1.00 spent on wages, industry operators spent about $0.03 on capital... purchase to read more