Trends in Organic Cotton
August 16th, 2007 Posted in Research
Continuing on from Jason’s Post, the green movement truly is the wave of the future. But I’d like to talk more specifically about Organic Cotton. In 2006, sales in the organic cotton market nearly doubled to ~$1.1 Billion with international retailers like Walmart and Nike starting to really push their organic clothing lines and offers. As the market grows explodes, it will be interesting to see how retailers react.
Organic Cotton Market:
| 2001 | 2005 |
| 100+ SMB Retailers | 30+ Major Retailers |
| Global Sales $245 Mil. | Global Sales $583 Mil. |
| Demand 5,720 Metric Tons | Demand 32, 326 Metric Tons |
| Supply 6,480 | Supply 31,017 Metric Tons |
Let me also mention that the market is growing 110% annually and is projected to be $2.6 Billion by 2008 which is an increase of 116%. In addition, by 2008 consumers are expected to be consuming 99,662 Metric Tons which is an annual growth of 75%. Therefore, it is sufficient to say that the players in the organic market are set to reap a large ROI.
Interestingly enough, the top consumer of organic cotton is Nike followed closely by Coop Switzerland (Grocery Store), Patagonia, Otto (Major German Retailer) and Walmart.
Other big players in the market include H&M with their new H&M organics line, Roots and their 100% environmentally friendly yoga studio, American Apparel and their Sustainable Edition line to name a few. These companies are starting to embrace the needs of their consumers and have the opportunity to corner the market on organic cotton. H&M specifically has a very cool organic baby line that will appeal to all mothers who want the best for the baby. (On that note, congratulations to Neil & Laurie and their new baby boy!!)
As Jason mentioned, pressure from the market is quickly mounting on all companies to employ more environmentally friendly standards and sell products that are better for the earth. The real selling points for me on this discussion are the numbers above. $2.6 Billion by 2008, 110% market growth year-over-year, almost 100,000 metric tons… the numbers are staggering. The opportunities in this arena are huge. Only a handful of companies have made a real commitment to the environment (Patagonia and Cotton Ginny are 100% Organic). With so much demand for organics already and an ever increasing profit margin for the companies that decide to play ball, how much longer can the Walmarts of the world really wait?
Sources: Organic Exchange, Google, Press Releases
