Tools and Techniques for Enterprise

Published:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

Tools and Techniques for Enterprise

Abstracts

This report analysis the external environmental impacts outdoor adventure clothing market in the UK. Participation in sports and activities directly affect market. As participation increase, demand for sports clothing also increase. Government efforts toward participation, big sport event has positive impact on this number. After the 2012 London Olympic Games there has been a big jump in the number of sport participant. In coming years, UK will host important sport competitions, for instance 2014 Glasgow Commonwealth Nations, World Canoe Slalom Championships 2015 and etc. Sport believed to have an increasing interest and participation. Furthermore, besides being performance apparel, sportswear also occupy a significant place in fashion market. This brings a great consumer interest in sportswear.

Contents

1.Introduction

1.1 Clothing Retailing

1.1.1 Market Size

1.2 Sportswear Market

1.2.1 Market Size

2. External Environmental Analysis

2.1 Economic Trends

2.2 Social Trends

3. Conclusion

3.1 Sport Participation

3.2 Fashion and Sportswear

4. References

5. Appendix

5.1 Appendix I – Clothing Retailing Market Size

5.2 Appendix II – Sportswear Market Size

5.2 Appendix III – Sportswear Market Forecast

5.3 Appendix IV – Sport Expenditure Forecast

5.4 Appendix V – Unemployment Rate Forecast

5.4 Appendix VI – GDP Growth Forecast

1. Introduction

The first part of this report will demonstrate the current market size of sportswear and forecast of this market in the next three years. In the second part, information will be given for external environmental analysis using PESTEL analysis. In the last and final part recommendation will be given in order to take necessary action to start-up a company.

1.1 Clothing Retailing

1.1.1 Market Size

According to the Office for National Statistics’ (ONS’s) Consumer Trends publication, the total UK market for clothing has risen over past few years. The market has reached the value of £48.5bn in 2012. Despite of the slight decline by 0.7% in 2009, sales increased thereafter by 6.4% in 2010, 8.3% in 2011 and finally by 4.3% 2012 [4]. Constantly growth since 2009 displays the market has remained fairly buoyant. Please see Appendix I for further detail

Figure 1. Market Size for Clothing Retailing

1.2 Sportswear Market

1.2.1 Market Size

Sportswear market can be categorized into footwear and clothing. Sportswear market has one of large proportion of UK clothing and footwear industry which worth £4.96bn in 2012, according to ONS’s Consumer Trends. Sportswear and footwear accounts for 71% and 29% of the market. The most significant increase occurred in 2012 by 5.4% which is believed to be contributed from London Summer Olympics, government sport initiatives and sporting events [3]. According to the forecast of Just Style to 2016, outdoor apparel will be successful in the developed country. However, due to low increasing rate of population in developed countries this sector will not grow dramatically [11]. On their forecast to 2017, Key Note states that sportswear marker will grow in next 5-years as that it will 11.6% percent in total. It is been estimated that sports clothing sector is to incline by 11% [3]. From two reliable source, it can be said that, sport clothing sector will continue to increase at steady pace because the upcoming sport events maintain the increased interest. Please see Appendix II and III for further details

Figure 2. Market Size for Sportswear. Source [4]

Figure 3. Forecast for Sportswear Market. Source [3]

2. External Environmental Analysis

2.1 Economic Trends

All our previous looking towards the market size indicated a decline in 2009 which is due to economic recession. But the in the following years UK’s gross domestic product (GDP) showed the strongest increase rate by 1.9% in 2013 since 2007. So the increasing GDP of UK should show a continually positive effect on sportswear market [9].

The Office of National Statistics (ONS) stated the number of unemployed people in the UK increased unexpectedly from 7.1% to 7.2% [6, 8]. Despite the unexpected increase of unemployment rate, latest figures from Her Majesty's Treasury (HM Treasury) estimates that the unemployment rate will 6.1% for 2015 [12]. Falling number of people out of work will play a key factor affecting the clothing retailing. As the employed consumer are much more likely to spend money on clothing.

Real household actual income per head was £4,510 in the second quarter of 2012, says Office for National Statistics in their publication of The Economic Position of Households, Q2 2012. This figures indicates the £69 increase compared to the first quarter of 2012 [10]. Moreover, gross household saving was £16.0bn in the first quarter of 2012 which increased to £18.2bn in the next quarter. The higher disposable income results in increase spending for families and more sales for companies. With higher actual income per head, individuals are more likely to spend their money on clothing, sport activities, sport events.

2.2 Social Trends

Over the half of adult population participate in some kind of sport or physical activities. The majority of this population prefers to engage in a general activity rather than competitive sport. People start to care about their own healthy living. Jogging/aerobics or joining health clubs were the initiatives taken by consumers. In following years, development of health clubs encouraged families and individuals to attend. In the 2000s, rising obesity rate has become bigger issue in public health. National Lottery provided funds which help local authorities to provide leisure centers, swimming pools and etc. to consumer. Sport participation directly affect the sport clothing sales. According to statistics Mintel [2], May 2013, swimming accounts for 29% of sport participation. Cycling, jogging and hiking accounts for 16%, 15% and 12% of total participated activities, respectively. These number shows us the popularity of outdoor pursuits among the UK population which directly affect the clothing market. Mintel forecast the consumer expenditure on participation sport to be increased in the following years. Please see Appendix IV

Figure 4. Sports Played (%). Source [2]

Figure 5. Forecast of Sport Expenditure (£m). Source [2]

3. Conclusion

3.1 Sport Participation

As a result of London Olympic Games, there has been an inclined public awareness and interest towards participation. After 3 years of zero growth, weekly participation in sport increased by 4% reached to 15.5m adults thanks to London Olympics. Interest in sport clothing will stay high as the different sport events will be occurred. For example, Glasgow Commonwealth Games 2014, IPC World Swimming Championships 2015 and World Canoe Slalom Championships 2015. These sports event will play an important role in outdoor sport clothing. Besides the major sport events, public awareness and increasing GDP, household income is another factor that has positive effect towards participation in sport. From Mintel Report, swimming, cycling, jogging and hiking account for the major proportion of sport participation of UK adult population. Same report also suggests the growth of this participation in the following years. In a country, like UK, unpredictable rainy weather in winter, even in summer, and continually increasing outdoor sport activities create a great opportunity for companies to become successful in terms of outdoor adventure clothing.

3.2 Fashion and Sportswear

Sports clothing sector have seen a big influence from fashion in recent years. The target market for sportswear industry increased as the market provides fashion-sensed goods as well as sportswear for physical activity. So, it is crucial for company to collaborate with fashion brands to maintain the latest trends in the market. This collaboration will bring an important benefit to the company. Besides its profit, it also could become a disadvantage for company in a market. Because new rivals start to appear from fashion brands in addition to sports brands. From this point, a collaborated sense of fashion and sport is significant for a company to become successful and maintain it. Moreover, a company also need to put instability of fashion trends into consideration. If the fashion becomes unfashionable, this will create an instability in the market. So, in order to overcome such problem, company must maintain the presence of performance and functionality of sportswear to stay in the market.

4. References

[1] Mintel. October 2013. Clothing Retailing. [Online] Available at: http://academic.mintel.com/display/638286/ [Accessed: 6 Mar 2014]

[2] Mintel. September 2013. Sports Participation Report. [Online] Available at: http://academic.mintel.com/display/638262/ [Accessed: 6 Mar 2014].

[3] Key Note Ltd. July 2013. Sports Clothing & Footwear Market Review. [Online] Available at: http://www.keynote.co.uk/market-intelligence/view/product/10828 [Accessed: 6 Mar 2014]

[4] Key Note Ltd. April 2013. Clothing Retailing Market Report. [Online] Available at: http://www.keynote.co.uk/market-intelligence/view/product/10792 [Accessed: 6 Mar 2014]

[5] Key Note Ltd. April 2010. Sports Market Report. [Online] Available at: http://www.keynote.co.uk/market-intelligence/view/product/2361 [Accessed: 6 Mar 2014].

[6] Trading Economics. 2014. United Kingdom Unemployment Rate. [Online] Available at: http://www.tradingeconomics.com/united-kingdom/unemployment-rate [Accessed: 6 Mar 2014].

[7] Trading Economics. 2014. United Kingdom Households Disposable Income. [Online] Available at: http://www.tradingeconomics.com/united-kingdom/disposable-personal-income [Accessed: 6 Mar 2014].

[8]Office for National Statistics. March 2014. Economic Review. [Online] Available at: http://www.ons.gov.uk/ons/rel/elmr/economic-review/march-2014/art-mar-er.html [Accessed: 6 Mar 2014].

[9]Office for National Statistics. February 2014. Second Estimate of GDP, Q4. [Online] Available at: http://www.ons.gov.uk/ons/rel/naa2/second-estimate-of-gdp/q4-2013/stb-second-estimate-of-gdp--q4-2013.html [Accessed: 6 Mar 2014].

[10]Office for National Statistics. October 2012. The Economic Position of Households, Q2. [Online] Available at: http://www.ons.gov.uk/ons/rel/hsa/the-economic-position-of-households/q2-2012/art---the-economic-position-of-households---q2-2012.html [Accessed: 6 Mar 2014].

[11]ProQuest. May 2011. Global market review of performance outdoor apparel - forecasts to 2016: 2011 edition: Market overview. [Online] Available at: http://search.proquest.com/docview/870642277/fulltext/8745BE4C7544458APQ/3?accountid=12253 [Accessed: 7 Mar 2014].

[12]HM treasury. 2014. Forecasts for the UK economy. [Online] Available at: https://www.gov.uk/government/publications/forecasts-for-the-uk-economy-february-2014 [Accessed: 7 Mar 2014].

5. Appendix

5.1 Appendix I – Clothing Retailing Market Size

2008

2009

2010

2011

2012

Values (£m at rsp)

40611

40335

42901

46480

48495

% change

-0.7

6.4

8.3

4.3

Source: [4]

5.2 Appendix II – Sportswear Market Size

2008

2009

2010

2011

2012

Sports clothing

3250

3210

3305

3355

3523

Sports footwear

1275

1250

1310

1350

1436

Total

4525

4460

4615

4705

4959

% change

-1.4

3.5

2

5.4

Note: Values - £m at retail selling prices (rsp)

Source: [3]

5.2 Appendix III – Sportswear Market Forecast

2013

2014

2015

2016

2017

Sports clothing

3637

3771

3860

3949

4036

Sports footwear

1501

1557

1601

1643

1696

Total

5138

5328

5461

5592

5732

% change

3.6

3.7

2.5

2.4

2.5

Note: Values are £m at retail selling prices (rsp)

5.3 Appendix IV – Sport Expenditure Forecast

2013

2014

2015

2016

2017

2018

Mintel Forecast (£m)

1408

1356

1466

1689

1770

2021

% annual change

-10

-3.7

8.1

15.2

4.8

14.2

Source [2]

5.4 Appendix V – Unemployment Rate Forecast

2013

2014

2015

Unemployment Rate (%)

7.2

6.7

6.1

Source [12]

5.4 Appendix VI – GDP Growth Forecast

2013

2014

2015

GDP Growth (%)

1.9

2.7

2.4

Source [12]

1

Writing Services

Essay Writing
Service

Find out how the very best essay writing service can help you accomplish more and achieve higher marks today.

Assignment Writing Service

From complicated assignments to tricky tasks, our experts can tackle virtually any question thrown at them.

Dissertation Writing Service

A dissertation (also known as a thesis or research project) is probably the most important piece of work for any student! From full dissertations to individual chapters, we’re on hand to support you.

Coursework Writing Service

Our expert qualified writers can help you get your coursework right first time, every time.

Dissertation Proposal Service

The first step to completing a dissertation is to create a proposal that talks about what you wish to do. Our experts can design suitable methodologies - perfect to help you get started with a dissertation.

Report Writing
Service

Reports for any audience. Perfectly structured, professionally written, and tailored to suit your exact requirements.

Essay Skeleton Answer Service

If you’re just looking for some help to get started on an essay, our outline service provides you with a perfect essay plan.

Marking & Proofreading Service

Not sure if your work is hitting the mark? Struggling to get feedback from your lecturer? Our premium marking service was created just for you - get the feedback you deserve now.

Exam Revision
Service

Exams can be one of the most stressful experiences you’ll ever have! Revision is key, and we’re here to help. With custom created revision notes and exam answers, you’ll never feel underprepared again.