The number of physical stores has been declining for years, but the decline has accelerated in recent years as stores have had to close during corona lockdowns and the resulting shift to online shopping. Last year’s war outbreak in Ukraine, high inflation and steep cost increases created additional difficulties for clothing stores.
Store owners have passed on some of the increased costs to consumers, according to ABN AMRO. For example, women’s and men’s clothes have become 10 percent more expensive on average since last February, and the price of baby and children’s clothes has risen nearly 13 percent. Consumers have become more attentive to their spending due to the higher prices. Spending in physical stores this year is on average 2.2 percent below 2019 levels.
Several fashion chains already ran into financial trouble this year. Just last week, the company behind 25 stores of clothing brands Vero Moda, Vila and Pieces went bankrupt. The stores of the Utrecht-based Doek Retail will remain open for the time being and are trying to get rid of their “considerable” stock with discounts, reported trustee Hans Hendriks. According to him, accumulated debts from the corona period were too large.
Incidentally, stores selling second-hand clothing are doing well, ABN AMRO observes. Second-hand clothing is still in demand, especially among young people. Since January 2020, the number of stores in this sector has grown by almost 11 percent. The bank expects second-hand clothing to become even more popular, partly because vintage clothing is increasingly available for sale online.