economical importance in fashion industry

Amity School of Fashion Technology

Presented By

VISHWA VARUN

Economical Importance in Fashion Business


Fashion industry

What we mean when we use the term fashion industry

Fashion is, Fashion is a popular style in a particular time or practice by definition, change.

Success in fashion comes with the ability to grasp and recreate in clothes and accessories the ethereal spirit of the time and voluble desires of customers.

Fashion adds an important design dimension to textiles or leather artefacts, which is capable of providing a continual and varied flow of new products


The factories manufacture clothes, but consumers buy

emotions, hope and dreams

Fiber -> Yarn ->Fabric -> Apparel ->Consumer

Steps used in manufacturing a garment starts from Fiber, end product reached to consumer

Nature of Fashion Market


Fashion retail is typically a consumer goods market.

It is characterized by very short product life, fickle consumer preferences, numerous competitors, relatively easy entry and exit, and a myriad of manufacturing, marketing and retail alternatives.

Over here, we will mainly make references to U.S and Europe where the fashion capitals - New York, Milan, London and Paris.

One of the reasons for their leading role in the apparel sector is that they are able to acquire information on future trends in color, theme and styles in advance.


Couture Wear :

Couture wears are exclusively tailored by in-house designers and are produced in limited numbers of expensive, high quality garments.

Couture houses are organized according to long-established principles, with the couturier (or designer) providing an identity and direction, supported by assistant designers and a head of the work room.

Couture houses are regulated by national organizations which ensure that members meet stringent design, manufacturing and commercial regulations. These regulations make couture garments affordable by very few consumers.


Ready-to-Wear :

As such, to be commercially sustainable, the fashion industry provides less wealthy consumers with cheaper garments.

Thereafter, manufacturers were making garments to be specifically sold in such outlets, facilitated by their new ability to produce relatively cheap and high quality garments.

RTW acquired greater significance during the 1960's and afterward as the division between it and couture became blurred. Designers were able produced garments which were distinctive and cutting-edge while remaining relatively affordable.


Fashion vs Luxury

A fashionable good can be a luxury good, but not necessarily is so. Very often it is not !

MASS BRANDPREMIUM BRAND

LUXURY BRAND

accounts for a very small share

of the marketThe high-end luxury market,

APPAREL MARKET BY PRICE-SEGMENT

Every one can buy such products


Increasing uncertainty

and risk

Medium to high

High

very high

RISK

VarietyVariety and the low predictabilitypredictability of factors that make

a new producta best sellerbest seller or a worst-sellerworst-seller generates a risk far greaterrisk far greater

in fashion than in other industries

RISK IN FASHION BUSINESS


Fashion Business of India

Export Business

Retail Business

In this presentation I'm covering retail business of apparel industry


In emerging markets around the world there has been a close linkage between economic development

Rise in per capita incomeGrowing consumerismProliferation of branded products Retail modernization

Fashion Retail Business in India

Consumer awareness increases and the proliferation of brands leads to increase in retail space. Thus, retailing is a part of the development proces.


The retail sector in India accounts for 22 per cent of the country's gross domestic product (GDP)and contributes about 8 per cent to the total employment.

India continues to be among the most attractive investment propositions for global retailers.

India has emerged as the fifth most favorable destination for international retailers, outpacing the UAE, Russia, Indonesia and Saudi Arabia.


Classification of Indian Retail Industry

Retailing industry can be classified into two classes:

- Organized retailing - Unorganized retailing

Major Organized Retail Segmentso Fashion & Lifestyleo Accessories o Furnitureo Food o Consumer durable o Leisure and entertainmento Health and Beauty Cosmeticso Telecom

Indian retail market, 8% constitutes the organized retail segment which is estimated

to grow at a rate of almost 30% by 2015. Clothing & Apparel make up almost a third of the

organized retail segment, followed by Food & Grocery and Consumer Electronics

Amity School of Fashion TechnologyApparel Retail Industry

The Indian Apparel Industry has an overwhelming presence in the economic life of the country. It is one of the earliest industries to come into existence in the country.

The sector has a unique position as a self-reliant industry, from the production of raw materials to the delivery of end products, with considerable value-addition at every stage of processing Apart from providing one of the basic necessities of life, the apparel industry also plays a pivotal role through its contribution to industrial output, employment generation, and the export earnings of the country.

Currently, it contributes about 14 percent to industrial production, 4 percent to the GDP, and 17 percent to the country’s export earnings. It provides direct employment to over 35 million people.


Market Segmentation By Users Category

Men's wear:Men’s wear market in India fastest growing apparel segment The entire apparel industry ,including domestic and exports,is pegged at Rs 3,270 billion and is expected to grow by 11% to Rs 10,320 billion by 2020.

Women’s wear: Women’s formal wear and ethnic wear markets are still ruled by unorganized players. With more women expected to enter corporate world, both these segments are good opportunities because of the market size.

Kid’s wear:Kids wear is a major category with few established players – viz., Lilliput, Gini and Jony, Catmoss, Benetton


Market Segmentation By Price

Low-end market: Volume driven, products are mostly unbranded and dominated by large number of manufacturers, mostly regional or even local players.

Mid-range market: Quality products. Manufacturers large and medium.

High-end market: Premium and super premium product categories. Dominated by MNC and major Indian manufacturers.


Key Players in Fashion Business

The apparel retail sector is experiencing the huge development and making an increased contribution to GDP, it requires a better and exclusive regulatory framework to sustain the impressive overall growth.

Competition in the retail sector is getting stiffer in the nation as many big players both national and international are testing and applying different retail plans in the market .

Entry by fresh players is still at a promising stage.


MADURA FASHION AND LIFESTYLE

Madura Fashion & Lifestyle, a division of Aditya Birla Nuvo Ltd, is one of India’s leading branded apparel companies and a premium lifestyle player in the retail sector.

After consolidating its market leadership with its own brands, it introduced premier international labels, enabling Indian consumers to buy the most prestigious global fashion wear and accessories within the country.

Madura Fashion & Lifestyle is defined by its brands — Louis Philippe, Van Heusen, Allen Solly,Peter England and People — that personify style, attitude, luxury and comfort.


RAYMOND APPAREL

A 100% subsidiary of Raymond Limited, Raymond Apparel Ltd. (RAL) ranks amongst India's largest and most respected apparel companies.

We bring to our customers the best of fabric and style through some of the country’s most prestigious brands –Raymond Premium Apparel, Park-Avenue, Parx and Notting Hill.

Crossing the gender divide two of our brands, Park Avenue launched the Western Women's wear collections.

'Park Avenue Woman'- A complete range of Premium Business Wear for women is designed specially for the working women professionals of today.

Amity School of Fashion TechnologyARVIND LIFESTYLE BRANDS

A subsidiary of Arvind is the other largest player in apparel retailing space of India it has portfolio of 1 international brands and 12 its own brands.

It also now hold Ed- hardy , which is projected to be launched in 2013 with new global product and different pricing strategies.

Apart from these above mentioned above players the other which also enjoy a good position in the Indian apparel retail market includes, Kouton retail India, Indus- League clothing, Zodiac Clothing co.


FOREIGN DIRECT INVESTMENT IN RETAIL

India has liberalized its single brand retail industry to permit 100% foreign investment, with regulatory issues and legal structures pertinent to establish operations in this new dynamic market.

India’s retail industry is estimated to be worth approximately US$411.28 billion and is still growing, expected to reach US$804.06 billion in 2015.

51 % FDI in multi brand retail business.


Impact of FDI in Indian Apparel Industry

No Impact Demand:

From the fashion apparel demand perspective, India has emerged as one of the most attractive destinations for American and European brands in the last 10 years and will continue to hold promise for the next 10 years, irrespective of the policy on FDI.

Apparel, being a more brand driven category than, say, food & groceries. It has already seen many international brands enter India over the past 15 years despite the restrictions in the FDI policy in single-brand retail withthe allowing of 100% FDI in single brand retail.


Industry as a whole will benefit:

From the industry’s perspective, allowing up to 100% FDI in single-brand retail and 51% FDI in multi-brand retail seems like a favorable proposition, since a large part of the fashion industry.

Supply consists of SMEs and they will surely benefit if more international brands make a foray into India.

Many foreign brands present in India have, over the years, increased their sourcing from India as this gives them the benefit of shorter lead times and lower costs.

Many brands have also set up their own back-end manufacturing infrastructure.


CONCERNS OF APPAREL BUSINESS AFTER FDI

The Main concern that is common among the cynic is that large retailers in apparel like zara,Raymond, Madura fashion and lifestyle will under-price their products to wean away customers from smaller Indian retailers, ultimately leading to the exit of smaller retailers from the Indian market.

In larger cities, where the foreign retailers would set up shop, their practice of offering rebates and discounts which is already practiced by retailers in India like cantabil, which offers discounts throughout the year, may be examined by CCI and prohibited if they are considered ‘unfair’ or ‘discriminatory’.


The economic importance of the apparel retailing sector, and the many changes that have occurred within it, implies that this sector is a prime area for competition enquiries.

In recent years, there have been some enquiries by the competition commission of India into apparel market behaviour that has been subjected to inquiries into acquisitions, combinations and their competition.

Apparel sector is growing at a very fast pace with growing Indian economy.

Many international players either have already plunged into Indian market or plan to do so in apparel sector especially after the recent changes the government investment policies.

Economic Importance

End of presentation

Thank You !

economical importance in fashion industry

Lifestyle

term fashion industry

fashion capitals new

couture garments affordable

cheaper garments

couture houses

high quality garments

able produced garments

apparel market