By Kanika Vohra
MSMEs have a significant role to play in India’s textile and apparel trade. It is estimated that this sector employs about 45 million people directly and nearly 60 million people indirectly. This labour-intensive industry is also the second largest provider of employment in India.
Today India ranks third in the export of textile and readymade apparel in the world, contributing up to 4.6 per cent share in the global trade. However, there is a story of growth unfolding in the Indian domestic industry that is very exciting. The Indian textile and apparel market size reached $172.3 billion in 2022. Looking forward, the market is expected to reach $387.3 billion by 2028, exhibiting a growth rate (CAGR) of 14.59 per cent during 2023-2028, as per a report by IMARC Group.
There are many factors contributing to this change. The undisputed increase in disposable income of the middle class with a surge in spending on fashion and accessories has been a game changer. Further, the rise of e-commerce platforms has transformed the retail landscape as they have made it easier for customers to access a wide range of fashion products. The expected rise of 110 million middle-income households will fuel this further. This opportunity is facilitating the entry of MSMEs into this market with varied products.
However, the key to success in any industry is understanding the consumer “Want”! Any product launched in sync with the consumer’s want can provide the recipe to success. A product launch in the textile and fashion industry has significant lead time as it takes between 4-9 months to get a product from idea to execution. Predictive science needs to come in to visualize a consumer’s ask at the beginning of the creation cycle. That’s where in-depth research and referring to forecasts has to take over.
Consumer buying is stimulated by both subliminal and obvious influences. From the buzz in celeb lifestyle or designer community, social media content being consumed to travel, politics, F&B, home interiors and global initiatives, there are multiple sources of influences on the fashion that we consume. Only predictive analysis of consumer preferences through research can point towards latent and future consumer wants.
Most MSME product creation teams are usually lean with a limited bandwidth. In the absence of research, the gut takes centerstage and most decisions are taken basis the feel of that moment. These unbacked decisions can be costly and most get updated with published forecasts. Relying on a forecast that takes into account all influencing factors is a way to de-risk the business. The famous “spray and pray method”-based gut feel in development is fraught with risk. A product launch must integrate research with historical data analytics and with a forecast of future trends as companies take a call on the right products to invest in.
The second point to focus on should be product differentiation. A unique fresh product in sync with consumer wants can again aid and abet steady success. The opportunities mentioned above have created a competitive landscape. The next research should be on market scoping, identifying green areas where products are lacking. There is a huge significance in investing in innovative new designs and materials to create distinctive and trend-setting products that cater to evolving consumer preferences.
MSMEs shouldn’t shy away from collaborations and partnerships with designers, artisans or other industry stakeholders. Further customization and personalization in products will allow the companies to connect with the consumer at a more intimate level and stand out in a competitive market.
A point to note is the increased awareness of consumers towards sustainable and eco-friendly products. The modern consumer now understands that the production process too needs to be sustainable, which is slowly becoming a factor in purchase decisions. While organic cotton has always been popular, recycled fibres are being preferred now along with biodegradable materials and waterless dyeing techniques. And manufacturers should endeavour to deliver in this realm.
Ultimately, catalyzing business beyond exports and focusing on our own domestic market is the need of the hour. And for this, we must rely on indigenous research and forecasts that can get the pulse of the consumers.
Kanika Vohra, Co-founder, ICH Next – a strategy firm focusing on fashion. Views expressed are the author’s own.
