A recent report by IBISWorld, a leading market intelligence firm, has provided insight into the state of the women’s and girls’ wear manufacturing sector in Australia. According to the findings, the sector is currently valued at $556 million and comprises 502 businesses. However, despite its significant size, the industry has been grappling with a decline, showing a compound annual growth rate (CAGR) of -2.7 percent over the past five years. Several factors have contributed to this downturn, including shifts in consumer behavior, a changing retail landscape, and fluctuations in the Australian dollar.
Decline in Traditional Retail and Rise of E-Commerce
One of the key contributors to the sector’s declining revenues has been the weakening demand from traditional department stores, which have long been major sales channels for women’s and girls’ wear. The convenience and growing popularity of online shopping have further accelerated this decline, as consumers increasingly opt to make purchases from the comfort of their homes. This shift toward e-commerce, while advantageous for certain brands and retailers, has significantly impacted the profitability of businesses that rely on brick-and-mortar retail channels.
Another important factor that has strained the industry is the appreciation of the Australian dollar. As the currency gains value, Australian-made goods become more expensive relative to those manufactured overseas, making local products less competitive in both domestic and international markets. Consequently, many businesses have struggled to maintain their market share in the face of cheaper imports.
Market Fragmentation and Leading Players
The Australian women’s and girls’ wear manufacturing sector is highly fragmented, with no single company dominating the market. In fact, the top two companies are expected to account for less than 20 percent of the sector’s total revenue in 2024-2025, while the top four companies combined are projected to hold only 32 percent of market revenue. This fragmentation highlights the challenges local manufacturers face in establishing strong market positions in an increasingly competitive environment.
Among the largest players in the industry are Cue and RM Williams. Cue, a retail fashion company, is notable for being 100 percent Australian-owned and predominantly Australian-made, according to information available on the company’s website. RM Williams, a well-known name in both the footwear and clothing industries, has a long-standing history of domestic manufacturing, having produced its products in Australia since 1932. These two companies, while significant in size, represent only a fraction of the overall market, underscoring the broad and diverse nature of the industry.
Employment and Economic Contribution
Despite the sector’s recent struggles, it continues to be a valuable contributor to the Australian economy, particularly in terms of employment. The industry currently employs a total of 2,175 workers, providing jobs for skilled labor across the country. However, this number represents a gradual decline, mirroring the contraction in the overall sector. In terms of wages, the sector is predicted to pay out $92 million in 2025, reflecting a decline of 5.5 percent CAGR since 2020. The shrinking wage pool highlights the pressures on profitability and the broader challenges faced by companies operating within this space.
Geographic Distribution and Industry Hubs
Manufacturing in the women’s and girls’ wear sector is primarily concentrated in two key regions: New South Wales and Victoria. According to the IBISWorld report, these areas benefit from their proximity to major markets, with Sydney and Melbourne serving as central hubs for production and distribution. Local manufacturers in these regions are able to take advantage of well-established supply chains, a skilled labor force, and access to innovations in textiles and fashion design. The concentration of businesses in these states allows them to remain competitive by leveraging local expertise and resources.
Sydney and Melbourne are particularly noted for their vibrant fashion industries and have become important centers for both design and manufacturing in Australia. The presence of key industry players in these cities has created a dynamic environment that fosters creativity and innovation, helping to sustain the sector despite its overall decline.
Future Prospects and Industry Trends
While the women’s and girls’ wear manufacturing sector in Australia faces significant challenges, there are opportunities for growth in certain niches. The ongoing trend toward sustainability and ethical production has the potential to reinvigorate the local manufacturing scene, as consumers increasingly seek out products that are environmentally friendly and responsibly made. Businesses that are able to capitalize on this trend by promoting the Australian-made aspect of their products may be able to capture a larger share of the market.
Additionally, advancements in textile technology and automation could provide a competitive edge for domestic manufacturers, enabling them to reduce costs and improve efficiency. The sector may also benefit from targeted government support and investment in innovation, which could help offset some of the challenges posed by global competition and currency fluctuations.
The manufacture of women’s and girls’ wear in Australia, though sizable, is undergoing a period of significant transformation. With declining revenues, the rise of online shopping, and increased competition from international manufacturers, the sector faces numerous challenges. However, with its strong regional hubs, leading players such as Cue and RM Williams, and a focus on innovation, the industry still holds potential for growth. As businesses adapt to changing consumer preferences and global economic conditions, the sector may find new opportunities to thrive in the coming years.
