Jeans in Sweden

2020 IMPACT

Jeans sees a dramatic decline in 2020 as consumers avoid unnecessary shopping trips

With large swathes of Swedish society refraining from making non-essential visits to retail outlets in 2020, retailers were not able to prevent the near-collapse of physical retail sales of apparel. Jeans is a product that most consumers prefer to try on before purchasing, thanks to differences in quality between brands and stores and poor standardisation of sizes (there can be significant size differences between same-size items across brands).

COVID-19 hampers new product development in jeans as players focus on profit margins and offloading old stock

Several important players had moved in and out of bankruptcy and undergone reconstruction prior to the COVID-19 pandemic, which effectively stopped many ongoing rebranding and re-launching processes. As consumers deferred making new purchases, jeans manufacturers also delayed attempts to drive new sales and focused instead on ensuring profit margins in new brands and selling off existing stocks at significantly lower prices.

International premium brands perform well, but economy jeans accounts for the largest share

International premium brand Levi’s maintained its lead in jeans in 2020 thanks to its strong brand recognition and reputation as being of high quality. Levi’s also offers frequent discounting, while its business model includes distribution by Levi Strauss Sweden to 23 retail stores managed by regional player Varner Brand Stores, which has good experience of the local economy.

RECOVERY AND OPPORTUNITIES

Value sales of jeans will be hampered in the short term

Jeans was reaching a stage of consolidation and contraction before the pandemic, and as companies close stores and focus on restructuring and profit margins rather than prioritising growth, this is expected to stifle the recovery of jeans in the short term, prolonging the downturn initiated by COVID-19. However, as the economy begins to recover and Swedes are able to shop in physical retail outlets more freely, jeans will see steady growth from 2022 onwards.

Complex economic factors will converge to hamper growth in jeans in the future

Jeans is a highly standardised category, with small perceived differences between different types of brands and price levels. The situation resembles that of near-perfect competition, which will undercut recovery.

Jeans will continue to be impacted by athleisure and changes in consumer behaviour, but opportunities for growth remain

Jeans’ poor performance in 2020 can be partly attributed to the athleisure trend, which continued to gain ground. Many Swedish men also returned to wearing trousers rather than jeans, and there were other variants of trousers for men, such as chinos, suit trousers or more functional attire.