Is kidswear holding fashion retailers back?

Children’s apparel rarely commands the spotlight in retail reporting – but when it underperforms, the drag is felt quietly across the balance sheet.

In its latest financial results, Adena Brands – owner of Monsoon and Accessorize – reported a £7.5m pre-tax loss and an 11% decline in group sales. The group said that inflationary pressures, especially from the National Minimum Wage increase, compounded already soft consumer demand. While core womenswear and accessories remained resilient, the children’s range was singled out as one of three underperforming areas, alongside sluggish store performance and weaker international markets.

The company initiated realignment and investment to address the problem, but these efforts suppressed sales further in the short term. Improvements are now underway – yet the children’s segment still casts a shadow over an otherwise recovering business. 

For Monsoon, where womenswear continues to trade well, the children’s line now appears more like a legacy commitment than a strategic asset. But this is not a Monsoon-only story. Across the UK, the challenge of kidswear is becoming harder to ignore.

On paper, children’s apparel looks like a natural brand extension – a logical adjacency for fashion retailers aiming to capture more household spend. But in practice, it’s anything but.

“For a lot of heritage and mid-market players, kidswear has drifted from being a smart brand extension to a bit of a drain,” says Graham Sykes, global executive creative director at Landor. “The margins are thin, returns are brutal, and often it ends up as a scaled-down version of adultwear – same styles, just smaller and less thought-through.”

Childrenswear is expected to contract again in 2025 before entering a slow-growth cycle, hindered by long-term structural trends such as declining birth rates and prolonged economic uncertainty.

There’s also the product pressure: children’s clothing must meet far higher functional demands than adultwear. Garments need to be soft, durable, washable, and still appealing to both child and parent.

“Once kids are out of nappies, they’ve got opinions – and they’ll reject clothes that don’t fit, itch, or just feel wrong,” Sykes warns. “If you’re not designing, making and selling with both the parent and the child in mind, it’s not a category – it’s a cost centre – and could even be damaging to the brand’s reputation as a whole.”

Monsoon’s performance illustrates this challenge. Despite the parent brand’s emotional equity, the kidswear range failed to resonate strongly enough to drive sales. The segment was publicly identified as underperforming, a rare move that suggests internal frustration with its commercial drag.

The broader market data reflects this muted outlook. According to GlobalData, the UK children’s market declined by 2.4% in 2024 – outperforming adultwear only because of its essential nature. Childrenswear is expected to contract again in 2025 before entering a slow-growth cycle, hindered by long-term structural trends such as declining birth rates and prolonged economic uncertainty. 

“Once seen as a natural brand extension, kidswear is starting to feel like more of a burden than a benefit for many fashion retailers,” says Rikke Wichmann Bruun, MD of client service at Cheil UK. “It can work – but only with real focus. Too often, it’s a stretched side hustle with low margins, high turnover, and an audience that outgrows you (literally) in months.”

Even before inflation reshaped consumer behaviour, the children’s apparel segment had started to fragment.

The cost-benefit equation for kidswear is under serious scrutiny – and the case for mid-market and legacy brands to maintain a children’s line is increasingly difficult to justify without a compelling point of difference or scale advantage.

Even before inflation reshaped consumer behaviour, the children’s apparel segment had started to fragment. Traditional retail models face pressure from demographic shifts, evolving shopping habits, and heightened expectations from today’s parents.

“We are seeing sustainability, longevity, and value for money as the biggest drivers in the market now,” says Kat Patterson, managing director at Art of the Possible. “With so many parents prioritising quality over trend-led design, brands that continue to chase fast-fashion trends in kidswear are missing the mark.”

It’s no coincidence this shift coincides with the rise of second-hand, rental, and resale models. Platforms like Vinted and Dotte thrive not just on affordability, but because they align with parents’ ethics and practical demands.

“As we head into a recession, we’re also seeing a savvier shopper emerge,” Patterson explains. “People are turning to charity shops, second-hand stores, and platforms like Vinted in greater numbers to make their money go further. The rise of fast fashion – especially in the kidswear market – has made cheap options more accessible, but when times get tighter, consumers shift toward more affordable, yet still fashionable, alternatives.”

George at Asda, F&F at Tesco, and Tu at Sainsbury’s dominate on the metrics that matter today.

Janea Kannett, founder of retailer Mother and Kub, confirms this trend. “Parents are less interested in brand names for children’s clothes and more focused on value and versatility,” she says. “Supermarkets and value players have upped their game massively, offering stylish, affordable options that meet the everyday needs of families, reshaping what parents now expect as standard.”

George at Asda, F&F at Tesco, and Tu at Sainsbury’s dominate on the metrics that matter today. According to Sykes, they have “nailed the brief by focusing on what families actually need – not what looks good on a marketing mood board.”

“Their stuff is affordable, holds up in the wash, and hits that sweet spot of being wearable without being bland,” he adds. 

Their advantage lies not only in price but in embedding themselves in parents’ weekly habits. Buying clothes during a grocery run adds practicality traditional retailers can’t match. “You can grab milk, bananas, and a stylish three-pack of leggings in one go — all at prices that make it hard for mid-market brands to compete,” Wichmann Bruun notes. “They’ve reset expectations around value and quality.”

Legacy names like Monsoon and Mothercare trade heavily on what’s been referred to as “emotional nostalgia” and “heritage”.

It’s not just affordability: these supermarket brands are nimble with design, often incorporating subtle trend cues or character licences that resonate with kids – avoiding the over-designed pitfalls of some high-street collections.

“Parents now know they can get something decent for under a tenner, so when a mid-market brand tries to sell them a £45 hoodie, it needs to seriously justify itself,” says Sykes. This pressure is enormous, especially for brands still leaning on occasionwear or gendered aesthetics that don’t reflect how children live and dress.

Legacy names like Monsoon and Mothercare trade heavily on what’s been referred to as “emotional nostalgia” and “heritage”, but are increasingly struggling to stay relevant in a category demanding price transparency, practical design, and sustainability credentials.

“Brands like Monsoon and Mothercare still hold emotional value for some parents, but nostalgia alone isn’t enough to drive sales anymore,” says Patterson. “They’re trying to balance tradition with modern demand, and in some cases, failing to shift quickly enough.”

Kannett sums it up by noting that mid-market and heritage brands like Monsoon and Mothercare have “struggled to adapt to this new set of priorities”, adding that parents focus “less on brand names and more on value and versatility”.

Unfortunately for them, the children’s market isn’t waiting. Supermarket and value players reshape expectations around price and functionality while heritage retailers remain tethered to past formulas.

“So many legacy kidswear lines cling to the fantasy of heavily gendered occasionwear – all scratchy lace and tiny blazers for events that happen twice a year, max,” adds Sykes. This disconnect leaves mid-tier brands squeezed: priced out of value-driven competition, yet unable to justify premium positioning.

Kannett sums it up by noting that mid-market and heritage brands like Monsoon and Mothercare have “struggled to adapt to this new set of priorities”, adding that parents focus “less on brand names and more on value and versatility”.

“It’s clear many are sticking too much to their heritage, which isn’t working in this new landscape,” Patterson adds.

However, not all is lost. A new generation of brands are charting a clearer course. Sykes says, it is the “brands that have stopped trying to compete with supermarkets on price and instead focused on solving real problems”.

Rental and resale platforms such as The Little Loop, Bundlee, and Dotte are gaining traction with parents seeking smarter, sustainable ways to dress growing children. Sykes believes that these brands are succeeding because “they’re designing the product and experience for the parent and respecting the kid”, which is “thoughtful, practical, considered, and purposeful in approach”.

Children’s apparel has shifted from an easy extension to a strategic dilemma. For many retailers, it’s less opportunity, more liability.

As a retailer of products for parents and children, Kannett adds that some newer kidswear brands have found success by focusing on high-quality, gender-neutral staples that can be passed between siblings or resold, “which really appeals to that sense of longevity and conscious consumption”.

Direct-to-consumer players like Mori and Lindex also curate trust with subscriptions, size-up programmes, and circular production models, which reflect a deep understanding of what families need.

“Premium brands pick a style or approach – Scandi-minimalism or premium-playfulness – and own it, like an adult retailer would,” says Sykes. “Emerging leaders focus on consistent storytelling, product integrity, and long-term engagement.”

Children’s apparel has shifted from an easy extension to a strategic dilemma. For many retailers, it’s less opportunity, more liability. And supermarkets have reset expectations around value and quality. Meanwhile, DTC and circular platforms capture parents with smart, sustainable solutions.

Mid-market and heritage players can no longer rely on nostalgia. As Patterson concludes: “Nostalgia alone isn’t enough to drive sales anymore.” Kidswear must be designed with purpose or not at all.