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Apparel Retail Industry Brief

The global apparel business according to the industry site Fashion United rakes in an estimated three trillion dollars annually (or about 2% of the global GDP). Womenswear is the single largest industry category with about 38% of the market followed by menswear, childrenswear, sportswear and bridal wear. Globally, the rising middle class in emerging markets as well as the increasing proliferation of fast-fashion continues to push the apparel industry to grow at about 2% annually according to the business intelligence company Euromonitor. Sportswear (together with its newly emerging cousin – athleisure) is the fastest growing category at over 4% followed closely by childrenswear.



Some of the evolving challenges facing apparel retailers today include:

  1. Need for more reactive supply chains to allow apparel retailers to quickly deliver the latest fashion trends and runway hits to compete against fast-fashion houses.
  2. Pressure to build a compelling ecommerce/mobile strategy to not only compete with e-tailers but to build a comprehensive omni-channel shopping experience for consumers.
  3. Vulnerability of brands to changing consumer tastes and fashion while increasing consumer awareness has forced retailers to focus on supply chain ethics, sustainability and traceability.

From a supply chain strategy perspective, successful apparel retailers will continue to focus on:

  • Better utilizing consumer, social-media and historical data to feed into merchandising and demand planning.
  • Dynamic pricing and markdown optimization that exploits life-cycle fluctuations to drive revenue and manage inventory.
  • Tighter supply chain planning that continues to reduce safety stock margins helping build a more agile supply chain.

Benchmarking Database and Methodology

SOK Markets operates as a fast-growing hard discount retail chain with 2,500 stores, 18 DCs, 3,500 SKUs and 2014 sales of $1.7 billion. The company looked to Solvoyo for a solution to address its profitability during rapid growth, optimize its inventory and help tackle its most crucial operational challenge of keeping its shelves full.

Our apparel retail industry benchmarking report is based on 192 retailers with publicly available financial information. Privately held retailers such as Forever 21, J Crew Group or Spanx are excluded from this study due to lack of adequate publicly available financial data. Also excluded from this study are luxury retailers and department store companies.

The pool of 192 fashion retailers have been classified into three groups based on their relative sizes for more comparative analysis and results:

  1. Companies with revenue greater than $2.5B. Ex: Inditex group (Zara), H&M, Fast Retailing Co (Uniqlo) or the Gap Inc.
  2. Companies with revenue between $500M – $2.5B. Ex: Chico’s FAS, Lululemon Athletica, Guess Inc or Esprit Holdings
  3. Companies with revenue less than $500M. Ex: Vera Bradley, Destination Maternity, Bebe Stores, or Bossini International

Summary demographic profile of the benchmarking database is below:


Demographic Profile


$2,500M $2,500M – $500M $500M Total
North America 19 20 13 52
Europe 5 9 18 32
Asia 4 41 63 108
Total 28 70 94 192
2016 Revenue (USD M) – Average $8,047 $1,189 $229 $1,719

Supply Chain KPIs Benchmarking Summary

Table below summarizes the financial performance of the benchmarking pool of 39 companies on five key supply chain metrics:

5 Year Revenue CAGR

>$2.500M $2,500M – $500M $500M – $100M
Top 25% 2.4% 1.9% 1.5%
Median 0.6% 0.5% 0.1%
Mean 0.9% 0.6% 0.3%
Bottom 25% -0.4% -0.4% -1.1%

Gross Margin

> $2,500M $2,500M – $500M $500M – $100M
Top 25% 52.5% 55.2% 57.2%
Median 45.5% 36.2% 50.1%
Mean 44.4% 45.8% 45.5%
Bottom 25% 37.0% 33.8% 33.3%


>$2,500M $2,500M – $500M $500M – $100M
Top 25% 52.5% 55.2% 57.2%
Median 45.5% 36.2% 50.1%
Mean 44.4% 45.8% 45.5%
Bottom 25% 37.0% 33.8% 33.3%

Days Inventory

> $2,500M $2,500M – $500M $500M – $100M
Top 25% 70 84 88
Median 97 138 153
Mean 99 127 182
Bottom 25% 123 163 233

% Sales Online

> $2,500M $2,500M – $500M $500M – $100M
Top 25% 13% 19% 12%
Median 9% 13% 7%
Mean 9% 13% 8%
Bottom 25% 5% 8% 3%


The 5 Year CAGR is the mean annual revenue growth rate over the last five years (2012 -2016). Gross Margin and Net Income Margin are based on ‘as reported’ financial results. Days Inventory on hand is calculated based of average inventory holding for a period over cost of goods sold.*Reported Online Sales is based on public disclosures made by approximately 12% of the companies in the benchmarking pool only.

Top 5 Supply Chain Performars:

Retailers > $2.5B

Overall Rank Company Country Leading Brand(s) Growth Gross Margin EBITDA Inventory
1 Ascena Retail Group, Inc USA> Ann Taylor, Justice 2 2 14 5
2 L Brands USA> Victoria’s Secret 8 8 3 4
3 Under Armour USA> Under Armour 1 9 10 7
4 Fast Retailing Co. Japan> Uniqlo 3 7 9 9
5 H&M Hennes & Mauritz AB Sweden> H&M 11 4 4 11

*Rankings based on a scale of 1-28 with 1 being top ranked.

Retailers $2.5B – $500M

Overall Rank Company Country Leading Brand(s) Growth Gross Margin EBITDA Inventory
1 Lululemon Athletica Canada Lululemon Athletica 3 18 2 9
2 Adastria Co. Japan RageBlue, Lepsim 5 12 11 7
3 Oxford Industries, Inc. USA Lily Pulitzer, Tommy Bahama 10 8 8 18
4 SuperGroup Plc UK SuperDry 13 1 6 32
5 Giordano International Hong Kong Giordano 25 3 9 11

*Rankings based on a scale of 1-70 with 1 being top ranked.

Retailers < $500M

Overall Rank Company Country Leading Brand(s) Growth Gross Margin EBITDA Inventory
1 Francesca’s Holdings Co. USA Francesca’s 10 23 4 2
2 Hallenstein Glasson New Zealand Hallenstein, Glasson 14 20 11 10
3 PAS Group Limited Australia JETS, BlackPepper 7 18 22 12
4 Sequential Brands Group USA Joe’s, Ellen Tracy 5 11 3 72
5 Joules Group Plc UK Jooules 12 23 19 22

* Rankings based on a scale of 1-94, with 1 being top ranked.

About Solvoyo

Solvoyo is the next generation planning and optimization platform built for the digital revolution in supply chain. Solvoyo helps companies close the gap between planning and execution. Our all-in-one platform forecasts demand, optimizes inventory, plans production, replenishes networks and concurrently optimizes transportation plans. Solvoyo is the only planning platform that allows companies to plan strategic, tactical and operational supply chain actions in one tool. The scalability, analytical capabilities and short implementation cycles of our true cloud platform help our clients achieve dramatic improvements in performance. We are headquartered in Boston, MA with our R&D center in Istanbul, Turkey. For more information,

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