School Uniforms are Quieter but Still Growing

Five years ago, the public school uniform market rolled into stores with a big bang and a lot of fanfare from politicians and education advocates.

Today, that talk has calmed, with lawmakers more concerned with international terrorism, the economy and national security.

But the school uniform market continues to grow. Advocates of school policies that require students to dress to a common standard say these policies decrease violence and increase academic performance of students who no longer have to worry about being ostracized over their choice of wardrobe. With the passage a year ago of President Bush's "No Child Left Behind Act of 2001," retailers and suppliers see the school uniform market gaining sales momentum.

"We think uniform policies will be closely tied to this program as it is implemented and as the correlation is made between uniform policies and successful schools," notes a spokeswoman for Kmart.

The increased focus on educational performance mandated by the law should resuscitate enforcement of uniform policies in school districts that have been lax in implementation of those policies. This is significant for two reasons: first, enforcement sometimes starts to lag after several years. Second, since most large school districts already have uniform policies, the bulk of current and future sales depends on growth in existing markets. A few years ago, most sales growth in the school uniform market came from districts that had recently enacted policies. School uniforms, a category regarded as highly seasonal and very SKU intensive, recorded total sales of roughly $1.1 billion to $1.2 billion last year.

"The growth rate is now slower and steadier," notes Stacy Bobroff, marketing director at New York-based supplier French Toast. "But we're seeing our retailers have success in both old and new markets. With the No Child Left Behind law, schools will be looking for ways to comply."

Fort Worth, TX-based Dickies reports that its school uniform sales are about evenly split between new and existing markets. Three years ago, the market was skewed about 75/25 in favor of new markets, says Jon Ragsdale, vice president of marketing and merchandising. "At the beginning, there was a big waterfall of large school districts that were adopting policies. Over the last 12 to 18 months, we haven't had any big markets switch to uniforms other than Memphis and areas of Atlanta. Those are going to represent big growth chunks."

After Memphis enacted its policy last year, one supplier, Long Street, "couldn't get goods into stores fast enough," says Harriett Cook, vice president of marketing for the New York-based company. This type of new market momentum, she adds, usually continues for a year or two after a new school district enacts a uniform policy. In an established market, "sales may go up or down each year, but huge percentage changes do not occur."

At the Dallas, TX-based Army Air Force Exchange Stores (AAFES), boys' wear buyer Mark Brown says the category is becoming so established and predictable that AAFES put school uniforms on automatic replenishment; before, stores ordered product as needed. "The top brands and styles have become pretty consistent in colors and types of pants, skirts and jumpers," he adds. He also reports increased activity in matching sweaters and jackets. Overall, his sales in dollars and units have continued to rise for three years.

In new and established markets, some retailers have also begun to keep this seasonal category in stock longer. "For the most part, you won't have a problem finding a uniform at Wal-Mart in November, although the category is still very seasonal," says Kyle Winger, Dickies' manager of kids' wear. "This may not have been true a few years back. Opportunities with existing accounts are increasing."

Geographically, some of the established markets for school uniforms include Chicago, Miami and Houston, as well as Long Beach and other parts of California, says the Kmart spokeswoman. Augusta, GA; Phoenix, AZ; and Louisville, KY, are also important, while Philadelphia has been cited as another new hot spot, in addition to Memphis.

Across the country, Texas may be emerging as the nation's uniform capital. In addition to benefiting from the state's widespread and established uniform policies, AAFES operates some of its largest stores - alongside its largest bases - in Texas. According to STS Market Research, which studies clothing sales for children age 13 to 18, Texas recorded some of the strongest gains last year. Uniforms accounted for 20.1 percent of total clothing units sold for teens in 2002 and 15.2 percent of dollars, an increase from 13.1 percent and 12.8 percent, respectively, in 2001.

However, the situation in New York City, which instituted a school uniform policy for city schools with much fanfare three years ago, illustrates how uneven compliance can play havoc with predicting sales growth.

First, not all of the city's 600-plus public schools complied with the uniform policy when it was introduced. The head of a children's after-school library program in a low-income area of Brooklyn noted that over the past two years she has seen a marked decrease in the number of children wearing uniforms. A Kmart spokeswoman, though, says uniform sales are brisk in the Bronx, where presumably policy enforcement is stricter.

And, of course, there is no way for a retailer or supplier to guarantee enforcement. "We know compliance is difficult and we see the issue, too," says Gigi Perkins, school relations manager for French Toast. "But we can't extend our arm that far. It does not equal any major decreases in sales. Sales are strong, even in markets where compliance is a problem."

Long Street's Cook says that typically, a market runs in three-year cycles, and New York City is in its third year. This means that during the first and second years after a policy is passed, sales are very strong. In the third year, sales level off. "But all kinds of variables can happen. And this is a very micro-marketed category that is controlled on an extremely local level."

Debby Garbato Stankevich is executive editor of Retail Merchandiser.

Editors Note: This article was reprinted with permission from Retail Merchandiser, a sister VNU publication. Retail Merchandiser (www.retail-merchandiser.com) is written for executives and managers in the mass merchandise, drug club and specialty retailing industries.