How to Start a Clothing Business in India?

Are you planning to start a clothing business in India but don’t know where to start? The idea of entering the booming fashion industry is great, but without the right guide, you may get lost. We have a detailed and informative guide to help you build your clothing business in India. This blog will assist you in navigating the procedure with relevant data.

An Overview of The Indian Clothing Market

If we discuss the market size of Indian textiles, it was 160 billion U.S. dollars in 2023. It is projected that the market is likely to increase to 250 billion dollars by 2030. It is expected to develop at a compound annual growth rate (CAGR) of 10% from 2024 to 2029. Driven by changing fashion cultures, India has a sizable and expanding domestic consumer base.

India is known as a major exporter of textiles with a strong international presence. With the trend of online shopping, e-commerce platforms are thriving in the clothing industry. People find it both convenient and affordable to buy clothes online. This success represents potential growth for entrepreneurs in the clothing market.

The Market Trends to Consider:

Since India is a country with diverse cultures, people have different preferences for clothing. The clothing preference is not only driven by diverse cultures but also by advanced technology. Let us explore some of the recent market trends that can help in building a business plan.

• Sustainable fashion: The growing environmental concerns are raising the trend of sustainable fashion in India. People are becoming more aware of the environmental damage and concerned over the social impact their choices of clothing make. People are demanding sustainable materials like organic cotton, recycled fabrics, and eco-friendly production processes.
• The rise of e-commerce: Lately, we have seen a significant rise in online shopping and online retail. The use of the internet and the advancement of technology have entirely transformed the world of the clothing industry. The best thing about online shopping is that it provides more access to a greater variety of clothing selections. Digitalization and social media marketing play a crucial role in making marketplaces popular. They also have a significant role in building brand and customer engagement. Through the power of social media influence and digital marketing, D2D brands are becoming more popular.
• Increased Local Brands: We have seen significant growth in local brands making their place in the big market. Many clothing brands started their story from a small region and have made it to the national level. Brands like Freakins, which was founded by Puneet Sehgal, Shaan Shah, and Sachin Shah in 2019, have changed the denim fashion in India. From Gen Z fashion to contemporary designs, they sell everything in denim. Indian consumers like to buy from such brands because they offer affordable and unique fashion.
• Athleisure and Comfort Wear: The demand for comfortable and adaptable wear is fueling the continued trend of combining leisure and sportswear. The growing emphasis on wellness and health is driving this trend.

Your Guide to Starting a Clothing Business in India: The Key Steps

It is crucial to keep in mind that you will need a strong strategy and a robust business plan to build a clothing business in India. If you have decided to start your clothing business soon, then consider this step-by-step process.

Identify the Type of Clothing You Want to Sell

What sort of clothing are you looking to sell? Do you want to focus on women's clothing or kids' clothing? Well, when starting a clothing brand in India, you will need to pick a niche that defines your brand’s voice. Choosing a specific niche can help you build a strategic business plan and stand out in the market. We would recommend you research a bit about your competitors and target audience before deciding on a niche. It will help you understand the preferences of your target audience and their buying pattern. Recognize the characteristics and interests of your intended customer base. This will help you with pricing, marketing, and product design.

Here are some of the types of clothing that you can consider:

• Ethnic Clothing: Kurtas, lehengas, and sarees
• Casual Wear: T-shirts, jeans, comfy everyday outfits.
• Formal Wear: Suits, blazers, and office wear
• Athleisure: Activewear, yoga pants, and gym attire
• Kidswear: Infant and kid clothing
• Sustainable Fashion: Eco-friendly, organic, or upcycled fashion

Develop a Business Plan

You cannot start a business without a comprehensive business plan. You can create a summary of your target market, business concept, and financial forecasts. A strong market analysis may be required to determine your target market, rivals, and market trends in depth. A detailed specification of your product and services is essential. Additionally, specify your manufacturing procedures, sourcing plans, and product line. Apart from this, what is the marketing strategy you will use to position your brand in the market? You have to decide your marketing plans, including branding, customer acquisition tactics, and online and offline outlets. Create a thorough financial plan that includes projected revenue, operational expenditures, startup costs, and funding needs.

Requirements for Law and Regulation:

Select an appropriate business structure (private limited company, partnership, or sole proprietorship). You will register your business and GST if your turnover is above ₹40 lakh. You can choose sole proprietorship if you want to start on a smaller level. You may need to get the required trade licenses from the municipal government in your area. You might need other licenses, like an export or factory license, depending on your business plan.

Investment Model

A financial investment in a clothing brand may not be too high, but it also depends on the type of clothing. You can get a brief idea about how much you will need to invest if you were to start on a small scale. Here’s the estimated breakdown:

• Business Registration & GST: ₹10,000 - ₹20,000
• Raw Materials & Inventory: ₹1-2 lakh
• Website Development & Hosting: ₹20,000 - ₹50,000
• Social Media & Digital Marketing: ₹30,000 - ₹1 lakh
• Packaging & Logistics: ₹30,000 - ₹50,000
• Miscellaneous Expenses: ₹50,000

Sourcing and Manufacturing

Once the legal formalities are done, you can start planning your sourcing and manufacturing process. You can find trustworthy vendors for textiles, trimmings, and additional raw materials. Manufacturing may involve choosing clothing manufacturers or producing internally. You can also choose to work with artisans and weavers. Here are some popular textile hubs in India:

• Surat, Gujarat – Best for synthetic fabrics
• Ludhiana, Punjab – Famous for woolen clothing
• Tiruppur, Tamil Nadu – Known for high-quality knitwear
• Delhi, Mumbai, Kolkata – Major wholesale markets

Set Up Your Store

How would you like to sell your clothes, and to whom? Even though you choose to have an active offline store, your brand would still require an online presence. Online marketing can help you scale and create a brand identity. You can start with online store platforms such as WooCommerce or Shopify. Additionally, you can sell on Myntra, Flipkart, and Amazon. For offline business setup, you can pick a busy area with plenty of people, such as a mall or a market. Initially, you may require s strong marketing plan to find customers.

Branding and Marketing

A business in the clothing industry may require a solid branding strategy for powerful success. Make sure that you have a unique and catchy brand name that attracts an audience. Just having a brand name may not be enough; a logo and visual identity are also essential to establish a strong brand identity. A marketing strategy involves creating a website that allows people to place orders, a social media account to interact with customers, and promoting your products. Leverage some effective digital marketing techniques like email marketing, social media marketing, and SEO. This will help you reach your target audience.

Focus on Customer Service

The most important thing in a product-based business like clothing is to build a relationship with your customers. You will have to design your fabrics and clothes according to your customer’s preferences. Make sure that you provide excellent customer service. Interacting with your customers through social media and e-mail marketing may be beneficial. To increase brand exposure, work with other brands or influencers.

Frequently Asked Questions

Q. How can I start my own clothing business in India?

To start a clothing business in India, you will be required to develop a robust business plan, register your business, decide on a sourcing and manufacturing process, set up your store, establish a brand identity, and build a relationship with the customers.

Q. How big is the clothing business in India?

The Indian clothing market is thriving with success. The market size of Indian textiles was 160 billion U.S. dollars in 2023. It is projected that the market is likely to increase to 250 billion dollars by 2030. It is expected to develop at a compound annual growth rate (CAGR) of 10% from 2024 to 2029.

Q. How much does it cost to start a clothing business in India?

The investment in a clothing business may depend on the type of clothing and the size of the business. Here’s an estimated breakdown of the investment you might need:

Small-Scale Business (₹2-5 lakh investment)

• Business Registration & GST: ₹10,000 - ₹20,000
• Raw Materials & Inventory: ₹1-2 lakh
• Website Development & Hosting: ₹20,000 - ₹50,000
• Social Media & Digital Marketing: ₹30,000 - ₹1 lakh
• Packaging & Logistics: ₹30,000 - ₹50,000
• Miscellaneous Expenses: ₹50,000

To start your own clothing business in India, all you require is the right approach to implement your idea. With some understanding of the market and strategic key elements, you can build a clothing business that will flourish. So, are you ready to start a business with a unique brand identity?