An Overview of the Canadian and Mexican Apparel Markets
September 2010
OVVCan&Mex9-2010 1 Trendex Purpose of Today’s Presentation ♦Introduce Trendex North America
♦Identity differences between the retail apparel markets in Canada and Mexico
♦Overview 2009 apparel expoexport patterns atterns to Canada and Mexico
♦Provide market entry insights into both apparel markets
OVVCan&Mex9-2010 2 Trendex Trendex North America
Provides comprehensive ongoing marketing metrics to the Canadian and Mexican apparel industries. As apparel industry specialists Trendex also offers companies val ue add ed i nsi ght s based on both working with apparel retailers and suppliers and its continuous propriety research information services. www.trendexna.com
OVVCan&Mex9-2010 3 Trendex OVVCan&Mex9-2010 4 Trendex Part A – Retail Market Overview TOTAL NAFTA APPAREL MARKET
2009 Dollars Estimated Retail Sales (U.S. Billions)
$214.5
$20.5 $20.4
Mexico Canada United States
OVVCan&Mex9-2010 5 Trendex TOTAL NAFTA APPAREL MARKET
2009 Retail Sales Per Individual (U.S. Dollars)
$706 $569
$191
Mexico Canada United States
OVVCan&Mex9-2010 6 Trendex Canadian and Mexican Apparel Markets 2009 Retail Sales
Apparel Segment 2% 5% Luxury
44% 28% Middle
70% 51% Mass
Canada Mexico
OVVCan&Mex9-2010 7 Trendex Canadian and United States Apparel Markets
Ratio of Product’s U.S. Sales to Canadian Sales
Market Size
30X
10X 8X 1X Low Average High Price
OVVCan&Mex9-2010 8 Trendex CANADIAN and MEXICAN APPAREL MARKETS 2009 Retail Sales
Canada Mexico
Ontario Mexico City Guadalajara
41% 42% 8% Man/Sask 8% 12% Alberta 12% 24% 35% 11% 7% British Quebec Col um bi a All Other Monterey Atlantic Mexico
OVVCan&Mex9-2010 9 Trendex TOTAL NAFTA APPAREL MARKET 2009 Dollars
Retail Channels of Distribution
(1) Department Stores 18.5% 29.7% 7% 28.2%
Discount Stores 22.1% 11.5% 22.0% Apparel Specialty Stores 27.7% 20.3% 50.9% Spgortin Goods 2.7% 2.1% Stores 3.5% 25.3% 30.5% All Other Channels 5.0% Canada United States Mexico *includes J.C. Penney & Sears
OVVCan&Mex9-2010 10 Trendex Total Mexican Apparel Market 2009 Re ta il Sa les Informal Markets Share
34.7%
26.9% 25.1% 25.5%
Total Market Mens Womens Juvenile
OVVCan&Mex9-2010 11 Trendex MEXICAN MEN’S APPAREL MARKET
2009 Informal Markets Share
Merchandise Category Units Pesos Dress Apparel 17.4% 10.3%
Pants 35.8% 27.6%
Shirts/Other Tops 37.7% 25.2%
Underwear 34.8% 24.3%
Sports Apparel 42.8% 28.6%
Socks 42.8% 34.8%
Outerwear 37.1% 25.8%
OVVCan&Mex9-2010 12 Trendex MEXICAN WOMEN’S APPAREL MARKET 2009 Pesos Informal Markets Share
Sweaters 30.4%
Skirts 30.0%
Jeans 28.4%
Dress Slacks 26.4% Blouses 25.1%
T-Shirts 24.9% Casual Pants 23.4%
Bathing Suits 17.3% Bras 15.2%
OVVCan&Mex9-2010 13 Trendex CANADIAN and MEXICAN WOMEN’S APPAREL MARKETS
2009 RETAIL SALES
Independent Apparel Retailers Market Share
7.8% 2.11%
Mexico Canada
OVVCan&Mex9-2010 14 Trendex Canadian and Mexican Apparel Retailers
Department Stores Better Specialty Chains
Canada Mexico Canada Mexico
Better Harry Rosen High Life None Palacio de Hierro Holt Renfrew Saks (1) Liverpool Sears Stoneh ouse Roberts Laura Mid Price Sears Suburbia The Bay Coppel Del Sol
OVVCan&Mex9-2010 15 Trendex CANADIAN and MEXICAN APPAREL MARKETS 2009 Retail Sales Largest 10 Retailers
Mexico Canada
Suburbia 9.1% Sears (Total) 10.7% Liverpool 6.0% Walmart 9.6% Coppel 4.3% The Bay 7.4% Bodega Aurrera 3.3% Zellers 4.7% Wal-Mart 3.1% Mark's W.W. 4.5% Sears 2.4% Winners 4.2% Soriana 2.3% Moores 2.4% Zara 2.2% Reitman's 1.7% Comercial Mexicana 1.3% Costco 1.7% Palacio de Hierro 1.2% Old Navy 1.4%
OVVCan&Mex9-2010 16 Trendex Foreign Retailers in Canada and Mexico
Mexico Canada Gap Gap Banana Republic Wal-Mart Banana Republic TJX Old Navy Zara Children’s Place Zara Mango Gymboree American Apparel Mango Motherhood Brooks Brothers H & M Talbot's Wal-Mart Eddie Bauer Bebe Aeropostale Forever 21 American Apparel Tommy Bahama Brooks Brothers Urban Behavior American Eagle Urban Outfitters Abercrombie & Fitch Etc.
OVVCan&Mex9-2010 17 Trendex CANADIAN and MEXICAN APPAREL MARKETS 2009
Foreign Specialty Stores Retail Share
18.0% 9.7%
Mexico Canada
OVVCan&Mex9-2010 18 Trendex Part B – Brand Shares TOTAL MEN’S UNDERWEAR 2009 Pesos/Dollars Largest Brands
Mexico Canada
Rinbros 15.1% Fruit of the Loom 18.4% Fruit of the Loom 13.5% Hanes 11.4% Playboy 12.4% Calvin Klein 8.1% Hanes 11.0% Joe Boxer 7.5% Calvin Klein 6.9% Jockey 6.5% Trueno 3.4% Stanfield 6.0% Optima 1.4% Teycon 1.4% Prodige 2.6%
OVVCan&Mex9-2010 19 Trendex TOTAL MEN’S JEANS
2009 Pesos/Dollars
Largest Brands
Mexico Canada
Levi Straus 12.2% Levi Straus 26.1% Mark’s Work Wearhouse 9.3% Furor 7.0% Wrangler 8.6% Oggi 6.9% Wal-Mart/725 5.3% Lee 4.2% Wrangler 4.4% Calvin Klein 3.0% Lee 3.2% Lois 2.4% Cimarron 2.3% Point Zero 2.4% Diesel 2.3% Guess 2.3% Tommy Hilfiger 2.2%
OVVCan&Mex9-2010 20 Trendex TOTAL WOMEN’S BRAS
2009 Pesos/Dollars
Largest Brands
Mexico Canada
Wonder Bra 20.1% Vicky Form 25.0% Ilusion 23.7% La Senza P.L. 17.6% Playtex 12.1% Warners 6.5% Avon 5.5% Triumph 3.3% Carnival 3.5% Daisyfresh 2.0% Lovable 2.9% Fruit of the Loom 1.9% MIA 1.4% Calvin Klein 1.6%
OVVCan&Mex9-2010 21 Trendex Part C – Import Patterns CANADIAN and MEXICAN APPAREL IMPORTS
Millions of Dollars (US) $8,429 $7,865 $8,260 $7,467 $7,001 Canada
$1,959 $2,032 $1,626 $1,654 Mexico $1,406
2005 2006 2007 2008 2009
OVVCan&Mex9-2010 22 Trendex CANADIAN and MEXICAN APPAREL MARKETS 2009 Dollars
Largpest Sources of A pparel Im orts
Mexico Canada United States China India Bangladesh Bangladesh United States Vietnam India Indonesia Vietnam Hong Kong Cambodia China Mexico Columbia Indonesia Spain Ital y Italy Pakistan
OVVCan&Mex9-2010 23 Trendex US APPAREL EXPORTS to CANADA and MEXICO
Millions of Dollars (US)
$497 Canada $477 $458 $450 $452
Mexico $214 $216 $183 $186 $158
2005 2006 2007 2008 2009
OVVCan&Mex9-2010 24 Trendex CANADIAN and MEXICAN APPAREL MARKETS
Percent Change in Annual Dollar Sales
Mexico Canada
2.8% 3.4% 2.9% 1.9% 1.2%
-2.1% -2.4% -2.3%
2008 2009 2010 2011 2008 2009 2010 2011
OVVCan&Mex9-2010 25 Trendex Mexico/Canada ~ Supplier Recommendations
♦Offer a clearly defined unique selling proposition ♦Be prepared to offer exclusivity ♦Forget offering private label production ♦Be flexible with payment terms
OVVCan&Mex9-2010 26 Trendex Mexico/Canada ~ Supplier Recommendations
♦Offer a clearly defined unique selling proposition ♦Be prepared to offer exclusivity ♦Forget offering private label production ♦Be flexible with payment terms ♦Don’t overestimate the size of the target market ♦In Mexico never use sales agents ♦In Canada treat Quebec as a secondary market
OVVCan&Mex9-2010 27 Trendex Mexico/Canada ~ Supplier Recommendations
♦Park any American ararrogance at the dooror ♦The attitude that Americans know best will not get you an order ♦Be willingg to share success stories/learnin 's as they relate specifically to the prospects channel of distribution
OVVCan&Mex9-2010 28 Trendex Mexico/Canada ~ Retailer Recommendations
♦Determine a realistic market potential ♦Initially open stores in 4-8 key high-profile malls in three to four cities ♦Opgenin stores in Quebec should be done as part of a phase two expansion ♦Become a member of the Canadian Apparel Federation
OVVCan&Mex9-2010 29 Trendex For additional marketing information on either the Canadian or Mexican apparel markets contact: Randy Harris Trendex North America (419) 724-4160 [email protected]
For information on Td’Trendex’s monthl y apparel newsletters contact: Info@trendexna. com
OVVCan&Mex9-2010 30 Trendex