16 August 2024, Mumbai
India's fashion landscape is undergoing rapid transformation. The fast fashion segment, once a niche category, has emerged as a dominant force, outpacing the broader apparel industry by a significant margin. With a growth rate of 30-40 per cent in FY24 compared to the sluggish 6 per cent growth of the overall apparel category, fast fashion is undeniably capturing the imagination of both consumers and investors. But is it the future of Indian apparel brands and retailers?
Fast fashion’s meteoric rise
As per to Redseer Strategy Consultants, Indian fast fashion market, currently estimated at around $10 billion, is projected to touch $50 billion by FY31, growing at a CAGR of 25-30 per cent. This is in stark contrast to the overall apparel market, which is growing at a much slower pace.
Several factors are boosting this rapid growth. Firstly, India's burgeoning youth population with high disposable incomes is a key driver. Secondly, the rise of e-commerce has made it easier for fast fashion brands to reach a wider audience. Thirdly, the growing preference for affordable fashion, coupled with the desire to stay updated with the latest trends, is boosting demand.
Someinfluencing factors that are pushing up the fast fashion market in India are:
Digital-first approach: Fast fashion brands have effectively leveraged e-commerce to reach a wider audience, offering convenience and a vast product range.
Rapid product cycles: These brands swiftly identify and respond to fashion trends, ensuring that their offerings are always in sync with consumer desires.
Aggressive pricing: Affordable prices make fast fashion accessible to a larger consumer base, democratizing fashion.
Strong influencer marketing: Collaborations with influencers help create a buzz around new collections and drive sales.
Can traditional brands transform?
While the concept of fast fashion is relatively new in India, its interpretation is evolving. The fast fashion business model is built on speed, efficiency, and scale. It requires a robust supply chain, strong design capabilities, and efficient logistics. However, replicating this model in India comes with its own set of challenges.
Unlike the ultra-low-cost, disposable fashion often associated with the term, Indian fast fashion is gradually moving towards offering affordable yet quality products. Brands are focusing on catering to the diverse tastes and preferences of the Indian consumer.
The transition to a fast fashion model is not without challenges for established brands. It requires a significant overhaul of their supply chain, design processes, and marketing strategies. Traditional brands often have legacy systems and processes that hinder their ability to move quickly. Moreover, they may face challenges in terms of pricing and brand image. However, the potential rewards are substantial. Some Indian brands have successfully made the shift, demonstrating that it is indeed possible.
Creating new demand or just shifting market share?
One of the key questions is whether fast fashion is expanding the overall apparel market or simply cannibalizing sales from traditional brands. While there is evidence to suggest that fast fashion is driving overall apparel consumption, especially among young consumers, it is also clear that it is impacting the sales of traditional brands. While it might lead to increased spending on clothing, there's also a possibility of sales shifting from traditional brands to fast fashion players. Experts believe that both scenarios are likely to occur. As the market matures, it's expected to expand the overall apparel market while also reshaping the competitive landscape.
The fact is, the fast fashion phenomenon is undeniably reshaping India's apparel industry. While challenges persist, the growth potential is immense. As the market matures, we can expect a more diverse and competitive landscape, with both new and established players vying for consumer attention. The future of Indian apparel undoubtedly lies in embracing fast fashion while addressing its environmental and ethical implications.
