Entering the European market for bodywear

Some of the world’s most interesting apparel markets are in Europe. However, establishing a business relationship with European buyers can be challenging. This report will help you understand what the most important requirements and opportunities are in the European market. You will learn about the legal requirements for exporting bodywear to Europe, about the best channels to get your product to market, about the countries where your competitors are and the best way to quote prices for potential buyers.

1. What requirements must bodywear comply with to be allowed on the European market?

If you want to sell bodywear in the European market, you need to comply with several requirements, some of which are mandatory, whether they are legal requirements or not. Others are voluntary, but meeting them can give you a competitive advantage. Some requirements only apply to certain niches in the bodywear market.

Mandatory requirements

There are several legal requirements you need to comply with if you want to export bodywear to Europe, including requirements concerning product safety, the use of chemicals (REACH), quality and labelling. Additionally, many buyers have created non-negotiable terms and conditions for all their suppliers to comply with. These requirements are not required by law, but still mandatory.

Product safety

Any item of bodywear for sale in the EU must comply with the EU’s General Product Safety Directive (GPSD: 2001/95/EC). European Union Member Countries will check if your product meets the applicable safety requirements.

If your buyer has supplied the product design, it is their responsibility to make sure it is legally safe for consumers to use. However, if you have any doubts about whether a design is not compliant with the EU’s General Product Safety Directive, discuss it with your buyer before you start the production process.

Special requirements for children’s wear

The EU has a specific standard for the safety of children’s wear, including bodywear. This standard contains requirements to ensure that cords and drawstrings are placed safely on apparel for children up to 14 years. This is to avoid strangulation and choking hazards. Check the EU’s 2019 Guidance Document for extra information on safety requirements for children’s bodywear.

REACH

Any item of bodywear exported to the EU must comply with the REACH Regulation, which stands for registration, evaluation, authorisation and restriction of chemicals. This regulation restricts the use of many chemicals in apparel and specific materials used for trims. The use of these chemicals in bodywear is either restricted or prohibited altogether.

Chemicals commonly used in apparel production, which are restricted under REACH include:

• azo dyes that may release one or more of the 22 aromatic amines listed in Appendix 8 to the REACH Regulation, nonylphenol and nonylphenol ethoxylates, and heavy metals, such as mercury, cadmium and lead;
• flame retardants, such as tris (2,3-dibromopropyl) phosphate, tris (aziridinyl) phosphinoxide and polybrominated biphenyls (PBB);
• waterproofing and stain-repelling chemicals, such as perfluorooctane sulfonic acid and its derivatives (PFOS), which were originally restricted under REACH, but are now restricted under the Stockholm Convention (EU Regulation 2019/1021), as well as other persistent organic pollutants (POPs);
• certain nanomaterials used to make fabrics antibacterial;
• nickel, a restricted compound in metal trims and accessories, such as zippers, buttons and jewellery;

• polycyclic-aromatic hydrocarbons (PAHs) and phthalates used in plastic and PVC parts.

Flammability

The EU has no specific legal requirements regarding apparel flammability, but several EU Member Countries have their own, including the UK, Ireland, the Netherlands. Switzerland, not a member of the EU but part of the EU single market, also has its own requirements. The EU has a voluntary standard on fire resistance of the children’s nightwear, which may aid in compliance with the GPSD. If you use flame-retardant chemicals in your apparel, be aware that you need to comply with the REACH Regulation for the use of chemicals (see above).

Labelling your product

You must specify the material content of every item of bodywear that you export to the EU, in accordance with EU Regulation 1007/2001. The purpose of this regulation is to let consumers know what type of apparel they are buying.

Bodywear made from two or more components that have different compositions must have a label stating the fibre content of each component. If two or more bodywear items have the same composition and form a single unit, they must have only one label.

Labelling the country of origin (‘Made in’) or labelling care instructions is not yet legally required in the EU. Including care labels is highly recommended though. ISO 3758: 2012 is the preferred standard for care labelling. The care label symbols are property of the company GINETEX. You need to pay a fixed compensation to GINETEX for the use of these symbols.

Intellectual property rights

If you are selling your own designs in the European market, you must make sure you are not violating any intellectual property (IP) rights. If your buyer provides the design, they will also be liable in case the item is found to violate a property right.

Complying with intellectual property rights also means you cannot copy nor share designs from one buyer with another. European buyers expect you to handle their designs prudently.

Non-legal mandatory requirements

In addition to the legal requirements mentioned above, you may be required to comply with non-negotiable terms and conditions that buyers have created for their suppliers. Such requirements are not required by law, but they are still mandatory.

Sustainable production and social responsibility

Many buyers in Europe are increasing their demands in relation to sustainable production and social responsibility. At the very least, buyers will ask you to open your factory doors for them, so they can conduct personal inspections of your factory. Additionally, you may be requested to comply with the following independent standards:

• Standard 100 by Oeko-Tex is the most widely required standard regarding harmful substances and sustainable production. European buyers may also require standards such as the EU Ecolabel, BCI (Better Cotton Initiative), GOTS (Global Organic Textile Standard) and Bluesign.
• Regarding social responsibility, BSCI (Business Social Compliance Initiative) is the most popular certification that European buyers require. Other popular CSR standards include FWF, WRAP, SEDEX, ETI, SA8000, ISO 26000, and Fair Trade.

Packaging requirements

In most cases, your buyer will give you instructions on how to package the order. If you agree with your buyer that they will clear customs in the country of import, which is the norm in the apparel industry, it is their responsibility to make sure the instructions comply with EU import procedures.

The packaging instructions will be written down in a packing manual, where you will find all relevant packing instructions concerning:

• type and quality of the packing material you need to use;
• size of the packing material;
• information that should be mentioned on the packing material, including style references and numbers, size breakdown, number of pieces and colourways;
• placement and position of barcodes;
• way of stacking;
• maximum quantity in a box or polybag;
• maximum weight of an export carton;
• named suppliers for the packing material.

Your buyer will also appreciate any efforts you make to reduce the environmental impact and the financial cost of using packaging materials. First, you can make suggestions on how to use less packaging materials. Another option is to use environmentally friendly alternatives, such as recycled and biodegradable materials.

Payment terms

Normally, European buyers will pay you a percentage of the total sum of the order, for example, 30% of it when they place the order, and the rest (70% in the example) after the order is completed. The most used payment method in the apparel industry for such a transaction is the letter of credit (LC). An LC obligates a buyer’s bank to pay the supplier when both parties meet the conditions they have agreed upon.

In other cases, a buyer might ask for a telegraphic transfer (TT) after 30, 60, 90 or sometimes even 120 days. This means you, as a manufacturer, finish the production and hand over the shipment to the buyer, including the original documents before payment is due. The payment will be made after the number of days that you have agreed on with the buyer. This is a risky payment agreement because you take full financial risk.

Additional requirements

In addition to non-legal, but mandatory requirements like standards and certifications, there are many services that buyers implicitly expect or at least highly appreciate if you want to do business with them. These requirements can differ from buyer to buyer.

Product design and development

European buyers of bodywear appreciate manufacturers that have their own ideas on product design and development. This service will help buyers to create unique products in their assortment. Ease of washing and resistance to staining during wear are product features that are highly appreciated. Such features would be traditionally be achieved by using synthetic fibres, but new technology allows producers to combine natural fibres with high-performance fabric finishes to achieve the same results, including:

• odour repellence
• breathability
• sweat wicking
• thermal properties

• stain release
• easy iron
• quick drying
• colour fastness
• anti-yellowing for white apparel and underwear

To ensure quality, and in some cases also environmentally friendly production methods, buyers may require you to source your base materials from a preferred supplier, such as:

• Lenzing for Tencel, viscose and Modal
• Mitsubishi Rayon Group for Saolon
• DuPont for Lycra

Communication

Smooth communication is an implicit requirement of all buyers. Always reply to every email within 24 hours. Even if it is just to confirm that you have received the email and will send a more complete reply later. If you have a problem with a production order, immediately notify the customer and try to offer a solution. Another good tip is to create a T&A (time and arrival) of every order and share it with your buyer. This file will help you to manage expectations, monitor progress and is the best guarantee of on-time delivery.

Flexibility

Many factories focus only on getting convenient orders: simple designs, large quantities and long delivery times. However, if you want to start a business relationship with a European buyer, be prepared to accept complicated orders first. Buyers will want to test your factory before giving you large, easy orders. Make sure at the start that a buyer will not continue to place only difficult orders with you and convenient orders elsewhere.

Expect a European buyer to require in their first order:

• high material quality and impeccable workmanship;
• order quantities below your normal minimum order quantity (MOQ);
• a price level that is lower than you normally would accept for small quantity orders.

Niche requirements

The following niche segments, although relatively small, are experiencing growth and generally belong to the upper-middle and premium price segments.

Men’s bodywear

The men’s underwear segment has been growing thanks to growth in the number of points of sale, including online channels, as well as the millennial age group, which is more accepting of new products than older generations in relation to, for example, new colour shades and bold prints versus traditional hues, innovative fabrics and functional styling. Target the premium segment with innovative and functional men’s underwear. This article in The New York Times reviews the brands that are disrupting the men’s underwear segment globally.

Shapewear

Advances in shapewear are offering constructions that allow the items to move better with the body and therefore be less restrictive. Heist, for example, uses film technology rather than sewn seams and elastic bands. Shapewear should not only improve the body figure, but should also be comfortable to wear.

Compression hosiery

Compression hosiery is gaining acceptance among both men and women alongside the focus on more active and healthy lifestyles, so this niche is expected to become more mainstream in Europe. Compression hosiery should be comfortable to wear during day-to-day activities.

Period underwear

Period underwear, also marketed as period-proof and leak-proof underwear, is designed to absorb menstrual fluid and incontinence. It is usually leak resistant and moisture wicking. Since it is washable and reusable, like any other underwear, it is marketed as a more sustainable solution than single-use disposable products, like tampons and pads. Different fabrics and styles include ‘hip hugger’, ‘sport’, ‘high-waist’, ‘brief’ help consumers select the best fit for them.

Leak-free underwear

Post-partum and women with urinary incontinence in general may need leak-free underwear. These products are mainly offered in specialised stores.

Gender-neutral children’s bodywear

Gender-neutral children’s wear is growing in popularity. Retailers like Hema, in the Netherlands, sell underwear for children that is not specific for girls or boys. A growing number of retailers are developing styles that do not specifically target only one gender, whether it is style, colours, design or cut., such as no front closure.

2. Through what channels can you get bodywear on the European market?

Before you start to approach European bodywear buyers, you need to determine what market segment fits your company best and through what channels you want to sell your product. It is now easier than ever to skip intermediaries and supply brands and retailers directly, even end consumers, at high margins. However, this comes with greater risk, as requirements become more stringent the higher you go up the value chain.

How is the end market segmented?

In addition to the obvious segmentation based on gender and product type, European buyers in the bodywear market can best be classified by price-quality level. The largest segments are women’s underwear followed by hosiery. However, the categories nightwear, home wear and men’s underwear show the most growth.

Supermarkets in the six biggest EU markets for bodywear are now offering a range of basics at very competitive prices. Specialised bodywear chains, which cater mostly to the middle market, have also been growing recently. Alongside the athleisure trend, there has been a recent shift in consumer preferences towards stylish comfort. A more basic styling, particularly in women’s underwear, has enabled retailers and general fashion brands, including designer brands and sports brands, to enter the bodywear market.

The women’s bodywear market, Europe’s biggest, is segmented as follows:

Table 1: Women’s bodywear market segmentation

Consumer type	Price level	Fashionability	Materials used	Functionality	Order quantities
Luxury consumer	Very high retail prices	Highly fashionable, unique designs	Luxury materials	Very high requirements regarding washability, durability, fit and cut	Low order quantities
Fashion conscious consumer	High retail prices	Styles in line with latest trends	High quality, sometimes organic materials	High requirements regarding washability, durability and fit	Low to medium order quantities
Practical consumer	Medium retail prices	Practical, fashion conscious designs	Medium quality, sometimes organic materials	Requirements include easy-to-wash, safety	High order quantities
Price conscious consumer	Low and extremely low retail prices	Basic and functional styles	Medium-low quality materials	Requirements include easy-to-wash, safety	High order quantities

The luxury consumer

In the luxury market, European brands like La Perla, Eres, Aubade and Versace sell highly fashionable, luxurious briefs, bras, slips, corsets, accessories, bridalwear and shapewear at very high retail prices. Buyers in this segment have extremely high standards regarding safety, washability, durability, fit, cut and use of luxury materials, such as high-quality lace. Order quantities are low. This market is stagnant.

The fashion-conscious consumer

The upper-middle market caters to fashion conscious consumers. It is home to brands and retailers such as Chantelle, Gossard, Marie-Jo and Triumph selling briefs, bras, slips, shapewear, limited bridalwear and functional underwear. Styles are fashionable, minimalistic or with extensive use of good-quality lace. Focus is on safety, washability, durability, fit, cut and high-quality materials, including organic. Retail prices are high, order quantities are low to medium. This segment is growing.

The middle market

Practical consumers shop in the middle market. Here you will find brands and retailers such as M&S, Sloggi, Intimissimi and Ten Cate selling functional and fashionable briefs, bras, slips and basic shapewear. Focus is on safety, washability, durability, fit and medium-quality materials. Buyers will sometimes require organic fabrics. Order quantities are high, retail prices low to medium. This segment is growing.

The budget market

The budget market has brands and retailers such as Sainbury’s, HEMA, H&M and Carrefour catering to price-conscious consumers who are looking for basic and functional briefs, bras and slips that have good quality, are easy to wash and safe. Organic materials are in small demand in this market, with notable exceptions such as C&A and Zeeman. Order quantities are high and retail prices are low, so your margins are too. This market is stable.

Table 2: Selected European bodywear companies and their position in the market

Company name	Price-quality level			Fashionability			Order quantities
	low	mid	high	basic	mid	high	low	mid	high
La Perla			x			x		x
Eres			x			x		x
Aubade			x			x	x
Versace			x			x	x
Chantelle		x	x		x	x		x
Schiesser		x	x		x			x
Lise Charmel		x	x		x	x	x
Gossard		x	x		x	x	x
Marie-Jo		x	x		x	x	x
Triumph		x	x		x	x		x
M&S		x			x				x
Sloggi		x			x				x
Intimissimi		x			x			x
Ten Cate		x			x			x
Sainbury’s	x			x				x
HEMA	x			x				x
H&M	x				x				x
C&A	x			x					x
Zeeman	x			x				x
Tesco	x			x					x
Carrefour	x			x					x

Through what channels does the product end up on the end market?

The most marked difference among your potential buyers is their place up the value chain, because that will determine how they do business with you. Within each part of the value chain, you will find buyers of different market size, with different requirements regarding certification, quality MOQ and price.

Each type of buyer requires a specific approach. Always try to find out in what part of the value chain your buyer is operating, what challenges they face in the market and how you can contribute to their sales strategy.

• If you want to target European end consumers, try selling via platforms, such as Alibaba, Wish and Amazon. Most online consumers can be found in countries in Europe’s northwest. You will need to invest in a web shop, stock, order management and customer service. Your biggest challenge will be return policies and lack of brand awareness, making it difficult to find buyers outside the budget market.
• Online multi-brand retailers such as Zalando, Asos and Yoox sell apparel brands. Although currently not many are focused on developing their own bodywear collections, that could change. Such platforms detect market interest fast and will immediately react upon sales data. Usually such companies place a small test order first. If the item is selling well, they will place the actual production order. Fast delivery is crucial.
• If you want to sell to retailers, the biggest names in bodywear are H&M and Zara. Many large supermarket chains, such as Tesco, also sell basic bodywear. As developer and buyer, retailers can place an order relatively fast and easy, as they only need one development sample for order confirmation. However, their buying behaviour can be unpredictable. Order quantities are high if you service Europe’s large retail chains, but so is the price pressure.
• Bodywear brands such as Schiesser and Lise Charmel typically develop a collection 12 months in advance. You will need a large sample room as brands require salesman samples (SMS) of each collection style. Every sample needs to be actual, meaning it must look exactly like the product will in the shop, with branded hangtags and accessories. It may take many months before orders are placed.
• Intermediaries such as agents, traders, importers and private label companies, sell your product on to buyers up the value chain. They are price focused and require flexibility in quantities and qualities. Some are located near or in the production countries and primarily do sourcing and logistics, such as Li & Fung. Others, such as Dewhirst and Crystal Martin work from Europe and also do market research, design and stock keeping. Their service level determines the commission rate they charge.
  

What is the most interesting channel for you?

If you are a small to medium-sized manufacturer in a developing country, intermediaries such as traders, agents and private label companies and retailers with a local buying office are likely the most interesting type of buyers for you. End consumers are a difficult target group because of complicated customer service demands and your lack of brand awareness in Europe.

Intermediaries

Intermediaries are the most adventurous type of buyer and are usually the first to investigate new sourcing destinations and factories. By working for this type of buyer, you will have access to many different buyers up the value chain and you can learn how to service them by following their instructions.

Retailers

Selling to a European retailer with a local buying office in your region gives you the advantage of doing business with a partner that knows the trends and requirements in the European market.

The choice between doing business with an intermediary or a retailer mainly depends on your experience and capability of understanding and servicing the retailer. As requirements are difficult and complicated, it might be a better idea to start business with an intermediary first before starting direct business with a retailer.

3. What competition do you face on the European bodywear market?

Many leading European bodywear brands have been in business for decades. They have built strong positions in the market and they usually work with a fixed selection of suppliers, making it difficult for newcomers to enter it. If you want to be competitive, it is very beneficial if you have local availability of export-quality cotton and synthetic fibres and materials, flexible MOQs and an innovative mindset regarding materials and techniques.

Which countries are you competing with?

China is the largest exporter of bodywear to Europe. Technical innovation, high efficiency, excellent customer service and the local availability of fabrics and trims give Chinese manufacturers an advantage over competitors in developing countries. Most factories in China are compliant with European requirements regarding quality and sustainability, but they face high MOQs, rising labour and production costs and China does not benefit from the Generalised Scheme of Preferences (GSP), which removes import duties to the EU.

Turkey has the main advantage of being close to Europe, plus its speedy manufacturing result in very short lead times. The country has a lot of small to medium-sized factories, producing high-quality, fashionable apparel items, which often offer the possibility of producing small quantities, including bodywear. It has local availability of cotton and a European business culture. Among other things, Turkish manufacturers will accept payment in euros, but wages in Turkey are growing and so are prices, threatening their ability to compete with producers in other countries, such as China.

Bangladesh’s producers focus on manufacturing volume orders, including bodywear. The country benefits from a large, fairly skilled workforce, low labour costs and the GSP. Bangladeshi production has traditionally been dominated by brand and retailer buying houses, which provide all marketing intelligence. But Bangladeshi producers have been slow to increase service levels, their biggest challenge, particularly in sales and marketing, technical expertise, flexibility in MOQs and compliance with international safety and sustainability standards.

Although wages are increasing, Sri Lanka remains a low-cost sourcing origin with a skilled workforce and efficient, compliant factories. The country’s producers are focused on higher added value products including upper market casualwear, women’s lingerie and nightwear, swimwear and embellished products. Sri Lanka lacks locally produced fabrics, but it benefits from the GSP+ tariff scheme.

India is a low-cost apparel producer country with a large workforce. India’s apparel production is generally divided into hubs based on product type, with the one around Delhi focused on womenswear and children’s wear, including bodywear. India, which benefits from the GSP, is the world’s largest producer of cotton and second-largest exporter, but producers provide relatively low service level and compliance with quality and sustainability standards.

Vietnam’s apparel industry has experienced high growth in recent years, developing a large capacity and achieving good efficiency levels, thanks to investments from mainly Chinese factory owners looking to benefit from the low production costs and the currently pending customs agreement with the EU and the US. In the coming years, production of higher value and complex products is likely to shift ever more from China to Vietnam. The country’s main challenges are the lack of capacity and rising wages.

Which companies are you competing with?

Many large Chinese manufacturers in the bodywear industry have shifted parts or all of their production to other developing countries to take advantage of even lower production costs and duty-free access to the European market. These manufacturers have well-developed raw materials sourcing networks. They can deliver fast, they are flexible in MOQs and offer high service levels and product development to their buyers.

Some manufacturers have even moved up the value chain by opening retail stores or selling their own branded product. This gives them valuable insights into consumer behaviour and wider market trends.

The Hoplun Group from China started out as a trading office in Hong Kong in 1992, serving the European lingerie market. Within seven years, it built its first manufacturing plant in southern China. Today, the company employs 30,000 people, operates nine manufacturing plants across three production countries, including China, Bangladesh and Indonesia, plus an office in Germany, Europe’s largest lingerie market. Hoplun also has its own wholesale brand, Dorina, and a retail brand, 6IXTY8IGHT, which has over 140 stores across Asia.

Hoplun is strong in sales and merchandising and provides value-added services, including materials sourcing and its own ready-made collection. Its decades of experience manufacturing for the EU market gives Hoplun the market knowledge and network to offer its buyers quality, best-selling designs with speed to market and flexibility in MOQs. The company advertises its certifications, including BSCI, Sedex, Global Recycled standard, Better Work, Oeko-Tex, GOTS and The Sustainable Apparel Coalition.

Turkey’s Inanc Textile is a manufacturer of a wide range of apparel items, especially bodywear. The company offers full-service product design and manufacturing. Inanc’s fully certified manufacturing setup is highly flexible, offering low MOQs and short lead times. The company promotes its compliance with certifications such as BSCI, Sedex and Oeko-Tex.

Horizon group from Bangladesh is a vertically organised underwear manufacturer focusing on manufacturing large volumes of mainly knitted items for the European and US markets. Horizon offers design service and fabric development, but the setup of their organisation shows relatively low flexibility on MOQs, as their focus is on larger retailers and brands. Horizon promotes its compliance with certifications such as BSCI, Oeko-Tex, ACCORD and GOTS.

Which products are you competing with?

The bodywear market has generally followed the athleisure trend, which emphasises comfort and functionality for more active lifestyles. Consumers are also buying underwear and sleepwear that makes them feel good and gives them convenience. One trend in sleepwear, for example, is towards pyjama bottoms that can be worn out as well as at home.

Women’s underwear, the largest segment, is highly diversified, so it offers lots of entry options. Women’s briefs are especially competitive, sold by supermarkets and middle segment in sets or multipacks at very low prices. The upper-middle segments are offering quality, comfortable and sustainable options using materials such as Micromodal, organic cotton and bamboo, as well as clean or seamless aesthetics.

Bras is the most diversified product category with options including shaping, nursing, everyday and sports bras. Push-up bras’ numbers have gone down, while bralettes (triangle bras) and sports bras, which are simpler to produce and have lower price points than push-up bras, have grown across all segments.

Men’s underwear, on the other hand, has traditionally had comparatively little variation in both styling and production. But the men’s underwear segment is growing, largely driven by young consumers and new fabrications and materials, such as Modal and Micromodal, bolder designs and increased functionality, such as anti-chafing design, anti-odour and moisture management fabric technologies.

4. What are the prices for bodywear on the European market?

The factory price of your product, which in the fashion industry jargon is your FOB price (for free on board), is influenced by many factors, including the cost of materials, the efficiency of your employees, your overhead and profit margin.

The following chart shows the average cost breakdown of a typical FOB price:

Chart 1: Breakdown of a typical FOB price

Note that these percentages may vary per factory and per order. Some factories accept lower profit margins during offseason periods or when order volumes are high. In addition, the percentages for labour versus fabrics may vary, depending on the efficiency and wage level of the workforce and the price of the materials. Efficiency goes up and material prices go down when producing large volume orders.

Retail pricing

The retail price of a bodywear item is on average four to eight times the FOB price, which is called retail markup. It follows that the FOB price is on average 12,5%–25% of the retail price of the product. Exceptions do exist. In the budget market, some large European retail chains may sell products for a markup of just twice the FOB price. Retailers mark the FOB price up four to eight times because they need to account for import duties, transport, rent, marketing, overhead, stock keeping, markdowns, VAT (15%–27% in EU countries), among other costs.

According to Eurostat’s 2018 comparison of retail prices for apparel, France has the highest price level among the top six apparel and footwear importer countries at 109.9 points compared to the European average of 100, followed by Belgium (106.4), the Netherlands (106.3), Italy (101.1), Germany (99.1), the UK (92.7) and Spain (92). Note that brands and retailers that sell in multiple European countries usually keep prices equal or deviate only slightly from the standard retail price.

Online commerce, a strong budget segment and intense competition have made consumers in Europe accustomed to low prices. Focus on sustainability and higher production costs have, at the same time, put manufacturers, suppliers and buyers under enormous price pressure. However, prices are expected to remain stable in the next three years thanks to increased efficiency, automation and the production shifting to low-wage countries.

This study has been carried out on behalf of CBI by FT Journalistiek.

Please review our market information disclaimer.