European retail & apparel industry outlook to remain stable: Moody's

"Global shipping delays hamper the flow of goods, reducing product availability and increasing raw material and transportation costs; as a result, clothing, home improvement, electronics and home furnishing retailers are most at risk of margin erosion,” said Guillaume Leglise, a vice president – senior analyst at Moody's and the author of the report.

In addition, the move to online, convenience and discount formats will persist, and Moody's expects investments in digital to accelerate and retailers to proceed with their digital transformation.

Retailers focused on luxury, discount or casual clothing will continue to outperform the sector. However, many apparel retailers' earnings and margins will still lag pre-pandemic levels. Still, the European retail and apparel sector's outlook could be challenged by material deterioration in trading conditions due to renewed or shopping restrictions, sustained supply chain disruptions prolonged inflationary pressures, the report said.

ALCHEMPro News Desk (KD)