Apr. 2--Thailand's fashion apparel market contracted 15 percent in the first three months of this year due mainly to economic difficulties, according to Central Trading Co, a leading distributor.

The contraction, a first since the 1997 economic crisis, came after annual growth rates of at least 10 percent over the past 10 years, said Varavut Matamapojanart, the company's senior vice-president.

The negative growth is expected to continue for the rest of the year because there are no positive factors to encourage consumers to spend more on apparel products.

"The overall demand for fashion apparel for the whole year will shrink, on par with the first quarter or even worse, because the economic recession has not bottomed out yet. More factories will be closed and unemployment will rise," he said.

However, the fashion apparel market this year is better than the situation during the 1997 crisis when demand dropped by at least 30 percent.

Mr Varavut added that demand for jean products in the first quarter dropped in line with the overall fashion apparel market.

Female shoppers now visit department stores once a month, down from three times a month in the past few years and the purchase volume fell to one or two pieces per transaction from two or three pieces in the past.

"But it is quite fortunate for the Lee jeans brand, for which sales in the first quarter rose around 10 percent. The growth owes largely to the popularity of its limited editions, which it is the only brand to offer," he said.

The company hired three singers of the Modern Dog band to be its presenters. They also designed their own fashion items for Lee from shirts and caps to belts.

"Only 30 to 100 pieces of each Lee The Modern Dog collection are available in the market.

When Modern Dog fans came to Lee outlets, they not only bought the Modern Dog collection but also shopped for other Lee collections. This made Lee jeans outperform the industry," Mr Varavut said.

However, the quarterly sales growth of the Lee brand was still lower than in the same period last year when it rose by 20 percent.

"The sharp drop of tourist arrivals, particularly in Phuket and Samui, has affected our sales, although not substantially because tourists make up just 10 percent in its total sales," he said.

In the 4.5-billion-baht jeans market last year, Lee ranked among the top three brands with a 20 percent share.

Central Trading will launch a new scheme in late April by collaborating among 20 brands in its portfolio. With every 2,500- to 5,000-baht purchase of Lee products, customers will get gifts worth at least 1,800 baht from Clarins cosmetics, Casio watches and Samsonite travel luggage.

"This scheme will speed up buying decisions of customers at points of sale," Mr Varavut said.

He added that the company aimed to raise a market share of Lee jeans to 21-22 percent this year.

-----

To see more of the Bangkok Post, or to subscribe to the newspaper, go to http://www.bangkokpost.com.

Copyright (c) 2009, Bangkok Post, Thailand

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

VFC,

A service of YellowBrix, Inc.