The European market potential for denim

The value of the European denim imports is estimated at €9.2 billion, making it a strong apparel subsegment. Men’s and women’s denim products account for a very similar rate and grow very equally, making both segments potentially interesting for denim manufacturers.

The best opportunities for the import of denim to the EU show Germany, The Netherlands and Spain who are the biggest importers of denim in the EU and the biggest importers of denim from developing countries in the same time. Furthermore, West-European countries show higher potential for market entries than Eastern European countries in terms of value and volume.

Currently, manufacturers should decide if they prefer to go for high-quality denim products, which become increasingly popular, or prefer to offer low-quality mass-products for European clothing chains.

The sourcing of denim trousers from developing countries is highly accepted by European countries, stating nearly a third (32%) of the total EU imports in 2019 with further growing tendency.

1. Product description

Denim is mostly worn as (long or short) trousers during the daytime, in some cases also as work uniform. The product category can be broken down into the subsegments: Women’s and girls’ denim products and men’s or boys’ denim products.

Men’s denim segment includes men’s or boys’ trousers and breeches of cotton denim, excluding knitted or crocheted, industrial and occupational clothes as well as bib and brace overalls and underpants (HS Code: 62034231).

Women’s denim segment includes women’s or girls’ trousers and breeches of cotton denim, excluding knitted or crocheted, industrial and occupational clothes as well as bib and brace overalls and underpants (HS Code: 62046231).

2. What makes Europe an interesting market for denim?

Europe is a significant importer of denim. In 2019, the value of denim imports to Europe, including Intra-EU imports, accounted for €9.2 billion, up from €7.7 billion in 2014, but down by 0.34% from 2018 (€9,919m) to 2019 (€9,162m). This corresponds to roughly 896 million units of clothing in 2019 (up from 783 million in 2014). During the last five years, the value of EU’s denim imports has been growing at an average of 3.6% annually which lays slightly below the 5.8% average growth of all EU apparel imports as reported for 2018 (as reported in a demand analysis published by CBI in 2019). After high growth rates in 2015 and 2016, the EU denim imports has stabilized at EUR 9.2 billion. The fashion industry fears to face significant declines due to the coronavirus in 2020. Nevertheless, the European Union will continue to be a big market for denim that fits the new trends.

Men’s denim clothes are the larger product segment in denim, stating €5.3 billion and likewise 58% of the segment’s value. Women’s denim clothes represent the remaining 42% of the segment by a value of €3.4 billion in total. With 4.1% average annual growth since 2014, the women’s denim segment is growing better in value as men’s denim products (3.3%) in the last 5 years. Both segments are overall growing only slightly, whereas the women’s denim subsegment experienced a decline in 2019 (falling from EUR 4.020m to 3.845m in 2019). Key reasons for this decline are sinking imported volumes in Sweden, Poland, Slovakia, Ireland, Spain, Estonia, Denmark, and Czechia.

Table 1: Denim imports to EU by segment, 2019 EUR value; % share of denim; average 5-year compound growth

Category	Value	% Share of Denim	5-yr growth average
Men’s denim	€5,316 m	58%	3.31%
Women’s denim	€3,845 m	42%	4.06%
All denim	€9,151 m	100%	3.62%

Source: Eurostat

The EU is also a large re-exporter of denim apparel. In 2019, it exported a value of €6.2 billion consisting of denim apparel (up from €4.7 billion in 2014). The EU denim apparel exports have been increasing at an annual average yearly rate of 5.6% between 2014 and 2019. The biggest exporters were Germany (€1.5 billion), Spain (€1 billion), the Netherlands (874 million), Italy (€735 million), Poland (€377 million) and Denmark (€288 million). Together, these six countries represent 77.5% of the EU’s denim apparel exports within and outside of the selected 28 EU countries. The biggest average annual growth has been overserved in Malta (49.5%), followed by Croatia (43.7%), Cyprus (21.5%), Estonia (20.3%) and Latvia (20.1%). In the same time, the highest decreases have been experienced by Belgium (-20%), Romania (-9.3%), Finland (-8.5%), Slovakia (-6.1) and Bulgaria (-4.8%).

Currently, the value of EU denim product imports is quite evenly split between denim products originating from inside the EU and denim products originating from outside the EU, respectively at 50.2% and 49.8%. In 2019, developing suppliers contributed 31.9% to all denim imports into the EU in terms of value (up from 29.3% in 2014) and the suppliers of the rest of the world accounted for 17.9% of the total import value (down from 24.1% in 2014). The value of EU denim product imports originating from the developing countries corresponded to €2.9 billion in 2019 and has increased at an average yearly rate of 5.4% since 2014.

However, the overall imports from outside the EU into the EU decreased at a rate of -0.6%. Respectively, the denim product import increased within the EU at a rate of 5.1%. This demonstrates an increasing interest of imports between EU countries themselves and from developing countries. Nevertheless, the market share of development countries is still growing, creating new opportunities for the countries.

Figure 4 shows that Europe’s Extra-EU denim product imports are dominated by Asian countries with Bangladesh, Turkey, and Pakistan, being the top three exporting countries. Together, these three countries account for 67.8% of all denim imports into the EU.

Figure 4: 2019 Extra-EU Imports of Denim by market share of exporting countries

Source: Eurostat

Figure 5 shows that Intra-EU exports of denim are dominated by Germany, followed by France and The Netherlands. The rest of the market appears to be very fragmented between the different countries of the EU.

Figure 5: 2019 Intra-EU Imports of Denim by market share of exporting countries

Source: Eurostat

Table 2 shows the top-10 Extra-EU exporters to the European Union and the top 10 Intra-EU exporters to (other) countries in the European Union. These countries act in direct competition to each other, fighting for the biggest market shares in denim products.

Intra-EU sales imports are let by Germany, France and The Netherlands which have been expanding further within the last 5 years. As the total share of Intra-EU imports are further growing, countries like Belgium, Estonia, Cyprus, Finland and Greece decreased in sales. In the same time, the involvement of developing countries increases, narrowing down the import value from countries of the rest of the world.

China’s exports to the EU decreased by -11.7%, while countries like Turkey (62.5%), Tunisia (57.3%) and India (56.5%) significantly increased their exports to the EU. These countries are expected to gain further market share in the near future, challenging the dominating role of China and Bangladesh further.

Table 2: Top 10 Extra-EU and Intra-EU Denim exporters to EU, 2019 EUR value; average yearly growth (since 2014)

Country	Value	5-yr growth		Country	Value	5-yr growth
Top Extra-EU Denim Exporters				Top Intra-EU Denim Exporters
Bangladesh	€1.3 b	↑7%		Germany	€1.1 b	↑6.0%
Turkey	€990 m	↑62.5%		France	€548 m	↑3.4%
Pakistan	€780 m	↑6.3%		Netherlands	€444m	↑10.5%
China	€353 m	↓-11.7%		Poland	€345m	↑9.3%
Tunisia	€339 m	↑57.3%		Italy	€294m	↑9.3%
Cambodia	€166 m	↑6.3%		Austria	€271m	↑4.4%
Egypt	€149 m	↑13.5%		United Kingdom	€253m	↑3.4%
Morocco	€148 m	↑0.4%		Spain	€232m	↑7.7%
Vietnam	€74 m	↑10.6%		Belgium	€198m	↓-1.0%
India	€50 m	↑56.5%		Sweden	€145m	↑2.0%

Source: Eurostat

Impact of Coronavirus on the European apparel market in 2020

The Covid-19 epidemic is strongly influencing the sales and processes within all segments of the fashion industry. Europe has to face an economic decline of more than 7% in total (as estimated in May 2020). In most European countries, local shops had to close during shutdowns, depending strongly on the support payments by the governments, the offer of heavy discounts and a seamless shift to digital channels. Denim trousers are specifically affected by the increased possibility to do home office and the interconnected change in daily outfitting. Home office caused another increase of popularity of athleisure products (jogging pants, leggings) and can be a direct threat to denim sales. In the same time, experts see office dress code to become more relaxed once employees return to their offices, making denim more acceptable in the daily business environment. Still, especially eco-friendly denim trousers might decrease in terms of demand since many sellers might look for cost-effective solutions to rebuilt their everyday business after the Corona pandemic.

Nevertheless, digital sales do not compensate the overall losses experienced by the fashion brands and has led to a decrease in import orders. A total lockdown in important export countries like China and Bangladesh did anyways influence the availability of orders until April 2020. Bangladesh is expected to experience a loss of roughly USD 6 billion due to major difficulties to deliver their products to the EU and US hence the Coronavirus and import restrictions. However, digital marketplaces like Zalando, AboutYou and others benefitted from the situation as reported in the first quartal financial report by Zalando. During the Corona Crises, fashion shows, festivals, summits and other events (for example the Bangladesh Denim Expo, the Denim Première Vision, the Denimandjeans in Japan and Vietnam and the Gartex & Denim Show in Germany and India) have been cancelled or postponed due to governmental regulations. 

As shops have started to reopen in Europe in May 2020, most brands are slowly recapturing their business as usual. Nevertheless, the brands can hardly estimate how much and how fast the market will recover in the close future, considering the strong dependency on the forward-going progression of the disease. Once the spread of the pandemic has been limited, the imports of denim is expected to reach an equal level as before or even increased. Leading brands in Europe do not believe in a lasting change in consumer behaviour (as stated in several interviews with brand executives). Further tips and information on the impact of the Coronavirus have been collected an can be read in the CBI news item ‘Running an apparel factory in times of Coronavirus’

3. Which European countries offer most opportunities for Denim?

Western European markets are currently larger importers of denim products than the Central and Eastern European countries. Table 3 shows the top 10 denim import markets in the EU. Germany is the biggest importer, but The Netherlands and Spain show higher growth rates. Poland is the only East European top-10 country and grows faster than any other top-10 country. The top-6 countries together account for 73.5% of denim imports in the EU and grew by an average of 1.7% per year in the last 5 years.

Table 3: Top 10 EU Importers of Denim, 2019 EUR value; average yearly growth

Country	Value	5-yr growth
Germany	€2.1 b	↑3.5%
The Netherlands	€1.2 b	↑7.5%
Spain	€1.1 b	↑7.5%
France	€593 m	↑2.1%
UK	€750 m	↓-0.2%
Italy	€633 m	↑2.4%
Poland	€364 m	↑9.3%
Belgium	€352 m	↓-2.2%
Austria	€298 m	↑5.0%
Denmark	€271 m	↓-0.1%

Source: Eurostat

The top-10 EU importers of denim from developing countries is shown in table 4. Spain stands out with a 55% share of imports from developing countries. Denmark has experienced a 21% growth in the last five years. Except for Italy, none of the top-10 countries experienced a decreasing import of denim from developing countries since 2014.

Table 4: Top 10 EU Importers of Denim from the Developing Countries, 2019 EUR value; average yearly growth

Country	Value of Developing country imports	5-yr growth	Developing country share of imports
Germany	€646 m	↑4.5%	30.5%
Spain	€622 m	↑9.4%	55.4%
Netherlands	€403 m	↑6.6%	35.0%
United Kingdom	€331 m	↑1.7%	44.2%
France	€316 m	↑6.1%	22.1%
Italy	€234 m	↓-0.7%	37.0%
Belgium	€106 m	↑2.3%	30.1%
Denmark	€85 m	↑21.0%	31.2%
Sweden	€55 m	↑5.5%	23.5%
France	€32 m	↑6.1%	33.1%

Source: Eurostat

Germany

Table 5: 2019 Imports of Denim to Germany by segment with 5-year growth, average import unit price and 5-year price evolution

GERMANY	2019 Value (€)	5-year growth	Average unit price	5-year price change
Men’s denim	1.4 billion	↑3.8%	€11.85	+€1.01
Women’s denim	740 billion	↑2.9%	€10.98	-€0.22
TOTAL:	2.1 billion	↑3.5%	€11.53	+€0.57

Germany is the largest denim import market in Europe. In 2019, the value of its denim imports amounted to €2.1 billion (up from €1.8 billion in 2014). This corresponded to approximately 184 million units of clothing. In the last five years, the value of Germany’s denim imports has grown at an average rate of 3.5% per year, while the import volume has grown at 2.4% per year. Popular denim brands from Germany include Mustang, Paddock’s, Jeans Fritz, Mac, Esmara and others.

Men’s denim constitutes the larger denim subsegment in Germany with 65.1% of share imports’ value (up from 64% in 2014), followed by women’s denim with 34.9% in 2019 (down from 36.0% in 2014).

The men’s denim subsegment is the larger and faster growing unit in Germany. In the last 5 years, denim import prices developed positively, and it has become the more interesting segment for manufacturers of developing countries. Women’s denim, in the same time, state the smaller part of the total denim imports but still increased by 2.9% per year in value. In terms of prices per unit, men’s denim products appear to be higher in value (€11.85) than women’s denim products (€10.98) with an increase by €1.01 of price per unit per year since 2014.

The Netherlands

Table 6: 2019 Imports of Denim to The Netherlands by segment with 5-year growth, average import unit price and 5-year price evolution

NETHERLANDS	2019 Value (€)	5-year growth	Average unit price	5-year price change
Men’s denim	744 million	↑8.2%	€11.06	+€2.47
Women’s denim	408 million	↑6.3%	€10.08	+€0.84
TOTAL:	1.2 billion	↑7.5%	€10.70	+€1.87

The Netherlands are the second largest denim import market in Europe. In 2019, the value of its denim imports amounted to €1.2 billion (up from €802 million in 2014). This corresponded to approximately 108 million units of clothing. In the last five years, the value of The Netherlands’s denim imports has grown at an average rate of 7.5% per year, while the import volume grew by 3.5% during the same period. Popular denim brands from The Netherlands include G-Star Raw, Denham, Scotch & Soda, House of Holland, MUD Jeans, Tommy Hilfiger Denim and others. In terms of import, the country profits from its proximity to the sea and availability of harbors which act as inexpensive source of product import.

Men’s denim products constitute the larger denim segment in The Netherlands with 64.6% share of imports’ value (up from 62.5% in 2014), while women’s denim segment state 35.4% of share (down from 37.5% in 2015). Men’s denim segment grew by 8.2% every year on average since 2014, stating an average development of price per unit increase by €2.47 per year, reaching €11.06 in 2019. Women’s denim overall import grew by 6.3%, while the average price per unit increased annually by approximately €0.84 to €10.08 in 2019.

The men’s denim segment is the larger one in The Netherlands, creating a lot of potential for developing countries.

Spain

Table 7: 2019 Imports of denim to Spain by segment with 5-year growth, average import unit price and 5-year price evolution

SPAIN	2019 Value (€)	5-year growth	Average unit price	5-year price change
Men’s denim	€ 435 million	↑4.0%	8.34	-€0.10
Women’s denim	€ 689 million	↑10.1%	7.71	+€0.41
TOTAL:	€ 1.1 billion	↑7.5%	7.94	+€0.16

Spain is the third largest denim import market in Europe. In 2019, the value of its denim imports amounted to €1.1 billion (up from €782 million in 2014). This corresponded to approximately 141 million units of clothing. In the 5 last years, the value of Spain’s denim import has grown at an average rate of 7.5% per year, while the import volume grew by 7.1%. Popular brands from Spain include Pepe Jeans, Companion Denim, Zara, Garcia, Lois and others.

Women’s denim products constitute the larger denim product segment in Spain with 61.3% share of imports’ value (up from 54.4% in 2014), followed by men’s denim segment with 38.7% share. Women’s denim product imports grew by 10.1% from 2014 to 2019, while men’s denim grew by 4.0%. In the same time, men’s denim shows the higher average unit price with €8.34, decreasing by €0.10 in the same period. Women’s denim products state an average price of €7.71 in 2019, also experiencing an increase by €0.41 since 2014.

The women’s denim product segment is the larger segment in Spain and is growing faster, while the price decreases slower. Men’s denim products are the much weaker segment and shows less potential than the women’s section. Nevertheless, both segments are expected to further grow in the near as well as later future due to the continuous demand of the product and the residence of local denim brands.

France

Table 8: 2019 Imports of Denim to France by segment with 5-year growth, average import unit price and 5-year price evolution

FRANCE	2019 Value (€)	5-year growth	Average unit price	5-year price change
Men’s denim	€539 million	↑1.1%	€10.27	+€0.12
Women’s denim	€414 million	↑3.6%	€9.04	-€0.22
TOTAL:	€953 million	↑2.1%	€9.69	-€0.07

France is the fourth largest denim import market in Europe. In 2019, the value of its denim imports amounted to €953 million (up from €857 million in 2014). This corresponded to approximately 98 million units of clothing. In the last 5 years, the value of France’s denim imports has grown by 2.1% per year, while the import volume grew at 2.4% per year. Popular denim brands from France include Selvedge, Ateliers de Nîmes, Tuffery, A.P.C., Rouje, Sézane, 1083 ,Reiko and others.

Men’s denim product imports constitute the larger denim segment in France with 56.5% share of imports’ value (down from 59.5% in 2014), followed by women’s denim with 43.5% of share in 2019. In the same time, the women’s denim segment increased by 3.6% of value from 2014-2019, while men’s denim products increased by 1.1% during the same period. The average price of men’s denim reached an average of €10.27 per unit (an increase by €0.12 since 2014), while women’s products state an average price per unit of €9.04 (a decrease by €0.22 from 2014 to 2019). 

Although the import of men’s denim products is still the larger segment in France, women’s denim constitutes the better growing segment. The price development of both segments shows slightly negative in the last years. However, France remains an interesting and growing market for denim imports which guarantees further grow for both segments in the close and more far foreseeable future.

The United Kingdom

Table 9: 2019 Imports of Denim to The United Kingdom by segment with 5-year growth, average import unit price and 5-year price evolution

UNITED KINGDOM	2019 Value (€)	5-year growth	Average unit price	5-year price change
Men’s denim	397 million	↓-2.0%	€11.41	+€1.85
Women’s denim	353 million	↑1.6%	€8.93	+1.07
TOTAL:	750 million	↓-0.2%	€10.70	+€1.29

The United Kingdom is the fifth largest denim import market in Europe. In 2019, the value of its denim imports amounted to € 750 million (down from €756 million in 2014). This corresponded to approximately 75 million units of clothing. In the last 5 years, the value of the United Kingdom’s denim imports has decreased at an average rate of -0.2% per year, while the import volume decreased by -2.9% during the same period. Popular denim brands from the United Kingdom includes Lee Jeans, Empire Jeans, MiH Denim, Hawksmill Denim, Fallow, Dawson, and others.

Men’s denim products constitute the larger denim segment in the United Kingdom with 53% share of imports’ value (down from 51.5% in 2014), while the women’s denim subsegment stated 47% of share (down from 48.5% in 2014). Men’s denim subsegment decreased by -2.0% every year by average since 2014, stating a positive price increase by €1.85 to €11.41 in 2019. Women’s denim overall imports increased by 1.6%, while the average price per unit increased by €1.07 since 2014 to €8.93 in 2019.

The men’s denim segment is now the larger one in the United Kingdom, creating a lot of potential for developing countries, whereas women’s denim products show an equally interesting opportunity. Both segments are predicated to grow more stable again as part of the overall European development in the future. In 2015-2017 the value of denim imports grew suddenly and significantly (from EUR 752 million in 2014 to EUR 931 million in 2015), while the import value rebalanced closer to the level of 2014 (2019: EUR 750 million) again as result of the “boom” in the years in-between.

In 2020, the United Kingdom has left the EU. At the moment, it is uncertain whether the UK will continue to provide preferential trade conditions for the developing countries and how the United Kingdom’s exit from the EU will impact the apparel sector and trade.

Italy

Table 10: 2019 Imports of Denim to Italy by segment with 5-year growth, average import unit price and 5-year price evolution

ITALY	2019 Value (€)	5-year growth	Average unit price	5-year price change
Men’s denim	€350 million	↑0.9%	€12.00	+€0.42
Women’s denim	€284 million	↑4.4%	€10.72	-€1.50
TOTAL:	€634 million	↑2.6%	€11.4	-€0.44

Italy is the sixth largest denim import market in Europe. In 2019, the value of its denim imports amounted to €634 million (up from €563 million in 2014). This corresponded to approximately 56 million units of clothing. In the last five year, the value of Italy’s denim imports has grown at an average rate of 2.6% per year, while the import volume has grown at 3.2% per year, making Italy a very interesting export destination for denim products. Popular denim brand from Italy include Diesel, Energy, Replay, Fiorucci, Gas, Meltin’ Pot and others.

Men’s denim products constitute the larger denim segment in Italy with 55.2% (down from 59.3% in 2014), followed by women’s denim 44.8% (up from 40.7% in 2015). The women’s denim segment grew significantly higher than men’s denim at an average annual rate of 4.4%, in contrast to 0.9%. Men’s denim products have the higher average unit price with €12.00 per unit which increased by €0.42 from 2014 to 2019. The average price per unit of women’s denim products decreased by €1.50 since 2014 and reached €10.72 in 2019.

The men’s denim import segment is slightly greater than the women’s product segment, whereas the women’s denim is growing stronger. In terms of prices, women’s denim imports are currently losing of stake. Nevertheless, the import of women’s and men’s denim products show equivalent potential in the near as well as the late future. There is no significant disruption expected for the import of denim to Italy in the future.

4. What trends offer opportunities or pose threats on the European denim trousers market?

The European denim market follows the general apparel trends related to sustainability, technological innovation and increased emphasis on corporate and social responsibility. For more information, see the CBI study on Trends in the Apparel market. Aside from these general trends, the denim market has its own, segment-specific trends: 

Changes in the types of Women’s denim

While being still the major style sold be fashion brands, the trend of skinny and super skinny denim jeans is currently lessening, and it is turning into a trend for high-waist straight or slouch trousers which get embroidered, patched or in other ways “individualized”. The length of denim is furthermore kept short to allow the sight on the (branded) shoes (this trend is called “flanking”). In 2020, trendsetters are looking for denim with split trousers legs, legs cropped from the cuffs and very wide legs. The “Mom’s jeans” high-waist fit of denim trousers is currently becoming fashionable. In terms of colors, classic denim blue remains the most successful but consumers still like denim jeans in “used” or stone-washed style.

Men’s denim trousers underly also fashion changes. Likewise, skinny jeans for men still state a significant part of the denim sales. Nevertheless, the trends are not as dynamic and as fast as the women’s denim segment.

Disappearing “middle market”

In denim, consumers do explicitly decide between the purchase of low-quality jeans at a lower price (for example H&M jeans) or high-quality trousers of specific brands (like Levi’s) which cost > EUR 100 per unit. The current trend goes towards branded and long-living classical denim jeans, whereas these are not affordable for everyone. Nevertheless, these high-quality brands set the trends the products and low-cost alternatives are highly appreciated. Denim exporters need to decide clearly about the quality level they would like to export to the EU; either mass-denim of lower quality or high-quality jeans for high-end brands such as Lee’s and Pepe. Both segments show increasing opportunities but demand a different set of work ethics and production standards.

Rise of Innovative Online Brands

The trend of fair and sustainable denim provoked the creation of numerous small brands distributing their jeans products (mostly) through the internet. In many cases, denim products are produced within the own country and cotton is purchased by fair conditions from the most proximate countries possible (for example Turkey and Morocco or Tunisia). The companies’ used fabrics aim to contain less or no chemical ingredients and show sustainable in terms of disposal. Some of these “micro brands” have developed successful enough to open first shops in European metropolitan areas (for example Armed Angels from Germany and MUD Jeans in the Netherlands).

Overall, the online distribution of denim jeans is expected to grow significantly within the next years. This means, successful companies may not only be the “traditional” denim product sellers, but also smaller companies in the market. Denim manufacturers might thus try to collaborate with these smaller brands if they can offer a certain production standard. Also, companies from developing countries might distribute their products right to the customer using digital channels. Additionally, the online distribution of denim jeans eases the offer of customized denim trousers, another trend which is currently on the rise, but shows no great potential to become a gamechanger in the industry yet. 

Athleisure

Since the emergence of “athleisure” (a constructed term which combines clothing traditionally worn by athletes such as jogging pants, leggings and activewear with leisure purposes) in 2014, denim sales have been threated (as reported here). Although denim remains the customers’ primary leg clothing for leisure, athleisure has become increasingly popular and stated a sales increase by up to 12% (in case of jogging pants) from 2018 to 2019. Athleisure is currently seen as a trend and it is uncertain in how far this trend might influence denim imports in the future.

Jeans Leasing

The sustainable brand “Mud Jeans” from The Netherlands is the first known company to offer the leasing of one of their jeans. Therefore, customers are paying a membership fee of €29, as well as a monthly leasing fee of €7.50. After one year, the customer can decide to keep the denim, switch it with another model (again for the fee) or turn it back for vintage use and recycle. For now, this remains a very niche approach, but if this system spreads the European market (for example due to the current sustainability movement), it might dramatically influence the import from any country in the world.

This study has been carried out on behalf of CBI by M-Brain GmbH.

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