3 key takeaways from Euromonitor's session at Source Fashion Jan 2026

In a presentation titled “Apparel & footwear market in 2026 and beyond: navigating the new world order” the data painted a picture of an industry not collapsing but recalibrating. Growth is slowing, consumers are sharpening and sustainability is maturing.

Here are the three shifts fashion leaders can’t afford to ignore
 

1. Growth is fragmenting - and volume alone won’t save you

Global apparel and footwear is forecast to grow at low single digits through 2030.

The UK sits at just +1.5% CAGR over the next five years and emerging markets will account for over 30% of global growth.

Meanwhile, Europe and North America remain sluggish. The industry is no longer rising on a single tide. It’s splintering.

For sourcing and buying teams, this matters. Because: 

• Margin discipline will become more important than unit expansion

• Overproduction risk increases in slower markets

• Regional strategy can no longer be copy-paste

• Differentiation has to be structural, not seasonal

The old model of drive volume, discount excess and repeat becomes increasingly fragile in a 3% world.

The question shifts from “how fast can we grow?” to where can we grow profitably and where must we become more selective?
 

2. Intentional consumption is redefining value

Euromonitor highlighted the rise of rational, tech-enabled consumption.

• 48% of global consumers like finding bargains

• 52% plan to increase savings

• Most research fashion digitally before purchasing

But this isn’t just price sensitivity, it’s discernment.

Consumers are:

• Researching before committing

• Prioritising durability

• Evaluating long-term value

• Shifting spend towards wellness and experience

At the same time, wellness is reshaping fashion’s edges. Tech-driven performance, longevity culture and hybridisation between sport, health and lifestyle are becoming growth drivers and this creates tension.

If consumers buy fewer, better products and invest more in experience than ownership - what does that mean for sourcing cycles built on constant newness?  

Value is no longer just about price architecture. It’s about credibility. And credibility now lives in product integrity, functionality, longevity and relevance. 
 

3. Sustainability has entered its commercial phase

Perhaps the most important reframing from Euromonitor’s session was this: sustainability is no longer primarily a regulatory obligation. It is becoming a strategic business lever. In a volatile geopolitical landscape - with uneven political commitment to climate targets - sustainability cannot rely on mandates alone

It must justify itself economically.

Euromonitor pointed to growing engagement in sustainable behaviours among high-income consumers, alongside new retail models e.g. repair, resale, rental - that extend product life and margin.

But here’s the real pressure point:

If regulatory shifts like EPR and Ecodesign push brands toward durability and circularity, while consumers simultaneously demand quality over quantity the volume model is structurally challenged.

And that forces the industry to confront a more difficult question: Can fashion generate value while reducing volume?
 

A structural reset, not a temporary dip

Euromonitor’s conclusion was clear

• AI is reshaping discovery and loyalty.

• Wellness is hybridising product categories.

• Market polarisation is intensifying.

• Sustainability is being reframed by economic reality.

This isn’t a cyclical slowdown, it’s a structural reset.

For sourcing leaders, sustainability teams and buyers, the implication is stark:

The next competitive advantage won’t come from moving faster, it will come from moving smarter. A tighter product focus, clearer value articulation and business models that can withstand a slower, more selective market.

The era of excess is finally ending!

You can read Euromonitor''s highlights from Source Fashion here