- Foreign Direct investment in\nthe apparel and textile sector has attained a valuation of $3.75 bn till March\n2021<\/li>
- The Indian apparel industry is\nprojected to grow to $65 bn by 2025-26 with a CAGR of 11%.<\/li>
- The government is planning to\nset up seven mega textile parks with an aim to double the industry size to $190\nbn by 2025-26<\/li>
- In 2020, the Indian technical\ntextile market was accounted for $7.1 bn and is expected to attain the\nvaluation of $11.6 bn by 2027 with a CAGR of 7.2 per cent.<\/li>
- The Indian technical textile\nmarket for woven is likely to grow at a CAGR of 7.4% by 2027<\/li><\/ul>\n\n\n\n
These figures imply that setting up a garment manufacturing business is indeed a profitable venture for startups in India.<\/p>\n\n\n\n
Read our article<\/b>:How to Setup Tannery Business (Processing Unit) in India? <\/a><\/mark><\/p>\n\n\n\n
Viable Blueprint of Setting up Garment manufacturing\nbusiness in India<\/h2>\n\n\n\n
Here is the detailed blueprint of setting up a garment manufacturing business in India <\/em><\/strong><\/p>\n\n\n\n
Step 1: Conduct extensive market research<\/h3>\n\n\n\n
It is vital to conduct extensive research pertaining to each link in\nthe supply chain of the garment business to know about things like;<\/p>\n\n\n\n
![\"Conduct](\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/10\/Conduct-extensive-market-research.png\")
<\/figure><\/div>\n\n\n\nAfter conducting research on the above parameters, it is vital to\ndig down the manufacturing landscape to know the degree of competition. <\/p>\n\n\n\n
It is also of paramount importance to research B2B market\nsegmentation to identify what the rivals have to offers and how your business\ncan differ by rendering a USP to the key end-users. <\/p>\n\n\n\n
Step 2: Know the market opportunities<\/h3>\n\n\n\n
To establish the manufacturing facility, you need to get accustomed\nto the existing market opportunities. <\/p>\n\n\n\n
If you opt to step into a saturated market where the degree of\ncompetition is significantly higher, then your chances of securing good profit\nmargins will be less. Henceforth, it is advisable to identify a key market that\nexcels in low competition and ensures good growth potential for start-ups. You\nalso need to get familiar with the consumer segmentation that you wish to\ntarget. This sustainability trend gets its push from consumers over 40 years of\nage. Therefore the target consumers, in this case, would be millennials.<\/p>\n\n\n\n
Furthermore, many consumers prefer buying a variety of clothes and\nhave great admiration for fast fashion. <\/p>\n\n\n\n
Therefore, in such a scenario, the manufacturer will have to\nestablish a facility & focus on changing patterns or design on a weekly\nbasis. Some mainstream brands like Mango and Zara source garments from South\nAsian nations, so there are viable opportunities to explore the global market\nafter establishing the facility, <\/p>\n\n\n\n
Step 4: Finalize the product portfolio<\/h3>\n\n\n\n
You need to decide the products you wish to produce at your\nmanufacturing facility after your research. You can start with plenty of\nproducts and diversify the product range in future. <\/p>\n\n\n\n
For example, you can start by producing trendy or staple items that\nare high in demand. <\/p>\n\n\n\n
You can also extend your product profile by adding other popular\nproducts such as denim wear, nightwear, men\u2019s shirts, so on and so forth. From\na marketing standpoint, it is advisable to start with one specific category\nthat adheres to consistent demand. <\/p>\n\n\n\n
Step 5: Identify Key Location for Production Facility<\/h3>\n\n\n\n
Identifying the apt location is a key step for establishing the Garment manufacturing business. It is advisable to start looking for textile hubs of India like Gujrat<\/em><\/strong>[1]<\/em><\/strong><\/a><\/sup>, Tamil Nadu, MP, UP, Rajasthan and WB. Textile hubs offer a string of benefits to the manufacturers that aid them to grow more swiftly. There are plenty of factors that one has to take into account while selecting the location. Some of them include; <\/p>\n\n\n\n
- Cost of the land availability\nof workforce <\/li>
- Logistic <\/li>
- Raw material sources <\/li>
- Prevailing Regulations and\nLaws <\/li><\/ul>\n\n\n\n
Step 6: Figure out the Production Volume<\/h3>\n\n\n\n
Depending on the investment potential and consumer demand, you can\ncompute the per day production of the facility and then accordingly establish\nthe unit. You want your facility to operate at full potential the gain the\nmost. Thus, it is essential to compute the production requirement aptly after\nconducting the required research.<\/p>\n\n\n\n
Step 7: Procure Required Equipment and Raw material for\nProduction <\/h3>\n\n\n\n
Based on the production volume, you decide how much equipment you\nwould need to start the manufacturing process. <\/p>\n\n\n\n
You need to compute per machine production capacity on a per-day\nbasis and aptly invest in it. Moreover, you need to pinpoint the number of\nworkers you will require to run the plant effectively; you will need to compute\nthe number of direct labour, floor manager, production supervisors needed.\nAfter that, connect with the trusted suppliers for the procurement of raw\nmaterial. You will also need to compute the volume of raw material required on\na weekly or monthly basis that will keep your Garment manufacturing business\nrunning without an issue <\/p>\n\n\n\n
Step 8: Compute Investment requirements and discover funding\nsources <\/h3>\n\n\n\n
This step requires creating a financial model encompassing all the\nfixed and variable cost estimations. This will help you accurately figure out\nthe initial investment needed for setting up the production facility. <\/p>\n\n\n\n
This model will serve as a legitimate medium for knowing the amount\nof investment needed from time to time. You may also need to procure funding to\nget this investment, as establishing a production facility is expensive. It is\nvital to opt for suitable funding options that do not pose any risk for your\nbusiness in future. <\/p>\n\n\n\n
Customer acquisition is a tedious task for new companies. One needs\nto invest a significant amount of time and investment in marketing to build a\nsustainable presence in the target market. You will have to appoint a marketing\nteam from the start to ensure customers know about your offerings. <\/p>\n\n\n\n
You need to underpin a marketing strategy focussing on your USP,\ncreate a user-friendly website, and utilize social media marketing for\neffective consumer targeting, tie up with global brands and so on. All this is\nconsidered as the customer acquisition costs.<\/p>\n\n\n\n
Step 9: Secure Mandatory Legal Permits and licenses to run\nthe Production Facility <\/h3>\n\n\n\n
Once you are done with the research and investment work, you can\nchannel your effort toward establishing the plant. Below is the typical legal\nprocedure for setting up a manufacturing plant in India<\/p>\n\n\n\n
1: Incorporate your business and open the current account<\/h4>\n\n\n\n
The company incorporation refers to a legal process used to\nconstitute a corporate entity or an establishment. An incorporated\nestablishment is an autonomous legal entity that is entirely separate from its\nowners. Choosing an apt business structure is the first and foremost step in\nthe company incorporation process. After that, the applicant is required to\nfile an e-form on the official portal of the Ministry of Corporate Affairs. The\ne-filing is done through the SPICe+ form, divided into imperative parts, i.e.\nPart A and Part B. <\/p>\n\n\n\n
2: Factory License<\/h4>\n\n\n\n
As per the norms of the Factory Act, 1948, all factory owners must register their production facility with the local governing authority before commencing the operation. The right of granting Factory license<\/strong><\/a> is in the hand of the Labour Commissioner Organisation.<\/p>\n\n\n\n
3: Fire NOC<\/h4>\n\n\n\n
A fire license refers to a legal document granted by the Local Municipal Authority of the respective state. This license ensures that the commercial property is fire-resistant and less likely to damage lives caused by fire accidents. The Deputy Chief Fire Officer or Chief Fire Officer has the required authority for granting this certificate. Fire Department NOC<\/strong><\/a> is a legal compulsion for establishments that have a height of more than 15 meters.<\/p>\n\n\n\n
4: NOC from SPCB<\/h4>\n\n\n\n
Under the current pollution control norms, all types of industrial\nfacilities, before establishing, are mandated to secure the NOC from the\nrespective SPCB. To secure this legal consent, the applicant is required to\nfile an online application on the State pollution board portal. <\/p>\n\n\n\n
5: BIS certification<\/h4>\n\n\n\n
The BIS (Bureau of Indian Standards) is a national certification body in India that operates under the Indian Ministry of Consumer Protection, Food & Public Distribution. BIS<\/strong><\/a> is the prominent certification body that plays a crucial role in the standardization of the Indian quality standards<\/p>\n\n\n\n
6: ISO 9001:2015<\/h4>\n\n\n\n
ISO 9001 certification indicates that the product offered by the company comply with international standards and indeed are of supreme quality. ISO certification<\/strong><\/a> is essential for company\u2019s growth because:<\/p>\n\n\n\n
- It serves as proof of\nactivities performed as per the protocol. <\/li>
- Management of the establishment\ncan examine the ongoing processes and determine the scope of improvement to\nensure quality policy. <\/li>
- To operate in a controlled\nmanner<\/li>
- It mitigates severe bottlenecks\nwithin the processes. <\/li>
- It ensures seamless\ncoordination between different verticals.<\/li>
- Creates a framework for\nimplementation and maintenance of a system<\/li>
- Helps in overcoming errors in\nactions<\/li><\/ul>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
The garment manufacturing business is a substantial business model that attracts minimal risks has immense growth potential. If you are looking for business opportunities that stick around a good success rate, then look no further than the garment manufacturing business.<\/p>\n\n\n\n