Metros continue to lead fashion retail in India

Indian apparel and fashion retail has seen fast forward growth in the last few years. No wonder, brands are expanding their reach to smaller towns along with metros. However, it’s the metros that continue to rule the fashion retail scene.

With several channels of retailing like traditional physical stores to the modern day e-tailing, direct selling and home shopping opening up, they are catering to the needs of shoppers asking for more. Another trend that has emerged is fashion retail chains as well as e-commerce companies focusing on high margin private labels, year-round discounts and sales promotions to woo consumers. Technopak Advisors estimates the Indian apparel market to be about 41 billion dollars (Rs 2,46,574 crores) in 2013 and to grow year-on-year at 9 percent over the next decade. With the entrance of foreign labels like Zara, domestic brands too are adopting the fast fashion model with fashion moving from ramp-to-street in no time.

As per Technopak analysis, value-wise distribution of the Indian apparel market reveals that the urban market has a share of 60 percent of the market compared to 40 percent rural. The high market share of urban India indicates a high average number of units purchased by a consumer and the tendency to buy products with a high value.

Metros lead fashion retail

Along with Mumbai and Delhi-NCR, other cities like Bangalore, Chennai and Kolkata are the biggest markets for apparel and almost all major domestic and foreign brands have their presence in these cities. These markets contribute 23 percent to Indian apparel market. The reasons behind high demand for apparel are, high number of employed young population, working women, high disposable incomes and exposure to social media.

States with high economic growth such as Gujarat, Maharashtra, Madhya Pradesh, Haryana and Andhra Pradesh have shown rising potential for apparel fashion, as per the study. Also, increasing fashion and brand consciousness in Tier II and III cities are showcasing huge potential for fashion players. But the only thing brands need to keep in mind, is they must be able to cater to the specific needs of consumers in these regions.

Along with southern cities such as Kochi and Coimbatore that are beginning to try out latest trends, eastern region is showing interest in brands and fashion trends. Though, it is difficult to penetrate this region due to geographical barriers, fashion conscious consumers are emerging.

North and west quickly follow fashion

As far as regional preferences are concerned, the country's north and west regions dominate fashion apparel consumption. The pattern indicates that most brands begin their retail expansion in these regions followed by the east and south. Louis Philippe from the Madura Fashion & Lifestyle stable, for instance, having more than 200 stores across the country, has the highest number of outlets in north, followed by south.

The reasons, experts say, is that consumers in the north and west of India, consistently follow Bollywood styles. Both the regions also enjoy a majority of global citizens either settled or working there, so the acceptance of new fashion trends is quick compared to the east and south. Also, youth in these areas don’t mind spending on fashion.