Fashion Waves and Trends in India: The Fast, the Rest and the (Future) Best!

Fast Fashion and Sustainable Fashion have been the recent buzz words in the fashion industry. When we look at a market like India, which is one of the biggest fast fashion markets globally, the evaluation of social and environmental impact and pollution created by fashion brands has become a hot topic of discussion. 

Based in my experience with Jabong , Myntra , Amazon and other fashion brands shaping the market in India, I would like to outline how the industry looks to me, with special attention paid to these concerns – and the opportunities they contain. 

Let’s get some numbers out of the way. 80% of fashion revenues in India come from the ‘Top’ 8 to 10 cities. The apparel industry is plagued with costs. 15% of fabric gets wasted during the manufacturing process itself. Brands claim innovation through automation, but the reality is sophistication of systems which still produce unending wastage – essentially the problems still remain the same. 30-40% of apparel sold online comes back to the warehouse undelivered, sometimes in damaged conditions, sometimes after the season is over. 25% of inventory never gets sold. Tier 2 to 6 cities in India have minimal demand for most fashion brands because of pricing, and they resort to offline buying from affordable smaller brands, or to fast fashion – a model well used by Shein in India. The fashion industry has an elephant in the room: one that is too lazy to become more efficient or just move along! A 1800+ INR average order value is just not made for the masses. So, go to any marketplace or brand, and they focus on the usual suspects: Delhi, Mumbai, Bangalore, Hyderabad, Kolkata, Ahmedabad, to name a few. Because a Tier 1 audience can afford mid- or high-priced fashion, the margins are greater, and they shy away from Fast Fashion in general because they are more conscious about sustainability. Having a ‘conscientious consumption’ mindset can look like a privilege rather than a stride toward true progress. 

So here comes Sustainable Fashion. The word ‘sustainable’ has two main senses here in practice: sustainable material or fabric, and sustainable processes (low wastage, low inventory). Sustainable material, sadly, is extremely pricey (costlier than normal fabric). And a part of that is because there are few competitors in the market. So pricing has not gone through the maturity curve. This results in even more pricey apparel, and sustainable brands that find themselves still targeting the same group of 2.5 to 3 million customers in a country of 1.3 billion. The 2nd aspect of sustainability – low wastage and low inventory – faces a stern rebuttal from the industry. Fabric vendors or textile manufacturers work like a union. They order a minimum order quantity, or the prices will go up. Manufacturers who are so used to manufacturing thousands of similar SKUs in one go will not entertain 100 or 500 units. If they do, the manufacturing charges would be exorbitant. These factors come together to present a massive opportunity: looking at the problem through the scope of technology, AI and predictive algorithms, and scanning the marketplaces for B2B and textile upgrade gaps, we can foresee a renewed fashion industry coming and the birth of a ‘refurbished’ apparel industry.  

Are new brands doing any of these? Yes, to some extent. But then, they are targeting an audience who are Tier 2+, with less exposure to e-commerce, less affluent, and very easily dismissive of new brands. To be able to create a powerhouse of sustainable fast fashion, you would need a lot of external tools or help: inventory management, return management, delivery intelligence, fabric procurement management, wastage management, marketing intelligence, to name a few. Each of these have categories has multiple start-ups in India, but just try to stack the monthly charges needed to maintain the overall ecosystem, and you soon realize that a 25% increase in MRP has to be done to adjust for these platforms. Not to mention the overwhelmingly high RTO from Tier 3 or 4 places, because of address issues, impulsive RTO-ers, poor delivery services, etc. Brands will likely find these tiers not affordable any more. In their quest to be profitable they will soon join the quest for 2.5 million Tier 1 customers, who are more brand conscious. 

So what is the future? 

Fast Fashion brands have 3 variables: Price, Sustainability and Customer Experience. Typically, they can choose only 2 out of these 3. Affordable brands that do minimal inventory planning lose out on the question of choices offered to customers and delivery timelines. Affordable brands with large assortments and fast delivery fail to remain sustainable. Sustainable Fashion brands with excellent customer experience fail to keep the price low. The industry in India is almost about to hit an inflection point, and disruption is going to take this forward. So while investors ask start-ups, ‘Why should we invest in a sector which is so crowded?’, one should really think, ‘is the sector really crowded? And what % of the Indian market has actually been accessed by this "crowd" of fashion brands?’ If brands have innovation up their sleeves, this is the right time to venture into the apparel industry.  

In India people often say that ‘Roti, Kapda, Makaan’ (Food, Clothing, Real Estate) demand never dies down. In fact, it’s likely to just go up steeply in future. 

Are the new brands equipped to ride the wave?