Indian retail has been growing over the last decade and though the pace may have slackened a bit in last 18 months, it hasn’t certainly hampered the growth in any way and has continued generating job opportunities – both in bricks-and-mortar and e-commerce. If the recently released Nasscom report is anything to go by, then the Indian retail sector, in general, may generate 2.5 crore new jobs by 2030 (of which 40 per cent will be, reportedly, fashion clothing). Notably, a major part of the share will be the bricks-and-mortar plus e-commerce model, which will account for around 50 per cent of the overall retail employment numbers.
The report also distinctly stated that the bricks-and-mortar plus e-commerce model will help generate retail exports worth US $ 125 billion, in addition to US $ 8 billion in incremental GST contribution in the next decade.
Here one would like to state that there are two aspects, of which one is retail, while the other is mom-and-pop stores. In this story, we will give a glimpse of employment through fashion chain stores. So, to put it simply, a lot of jobs are being created, and will be created, over the course of next 10 years and that’s more than good news. Fashion retail is no exception and will be, expectedly, on rise.
Indian clothing brands growing at a fast pace
While globally fashion retail is expected to grow big this decade, India, in particular, too could soon be a big market for fashion retailers on the back of a large young adult consumer base, increasing disposable income and relaxed FDI norms. As demand for apparels and fashion items keeps surging, lots of fashion stores are getting opened, resulting in more revenue, more profits and probably more employment opportunities.
Following the recent launch of its store at Khan Market (New Delhi), FabIndia, the Indian fashion retailer, has expanded its store numbers to 308 across India and now has plans to open 30 new stores this year. It has said that tech investments for the digital platform have been made and are in the process of execution.
Raymond Group, with over 1,500 stores spread across 600 towns and an expansive network of over 20,000 points-of-sale in India, along with its brands are also available in Tier-4 and Tier-5 towns. Notably, the Indian textile major created more than 3 million (30 lakh) work hours of employability for khadi artisans at 30 per cent higher wages in more than 75 clusters across 16 states during FY 2018-19. And the efforts haven’t subsided!
Leading fashion retail firm Aditya Birla Fashion and Retail Ltd (ABFRL), which owns reputed fashion brands like Louis Philippe, Van Heusen, Allen Solly and Peter England, is planning to hit revenue of Rs. 25,000 crore after five years. In January 2021, ABFRL had acquired a 51 per cent stake in designer brand Sabyasachi, following which it entered into a strategic alliance with brand Tarun Tahiliani a month later. Opportunities galore as ABFRL raised Rs. 1,500 crore by issuing a 7.8 per cent stake on a preferential basis to Walmart-owned Flipkart Group in FY ’21.
Brands acquiring stakes in firms and drawing out expansion plans reflects growth, and anything that’s growing breeds job opportunities. The homegrown fashion apparel and accessories firm Indian Terrain Fashions Ltd. has also said that it is in the process of expanding its retail footprint with the launch of 20 new retail stores in Tier-2 and Tier-3 cities and towns. The company, which has completed two decades of operations, has opened stores in Hubli, Lucknow, Siwan, Ooty, Ganganagar and Srinagar, amongst others. Small towns, where there are no strict lockdowns, have more easy access to markets, and therefore opening stores there seems to be the right move.
Biba, another fast-growing Indian retailer, continued its expansion spree and launched new stores across the country all through 2020 post lockdown. August 2021 saw the brand come up with its 35th flagship store (290th store overall) in the country and 34th in the Delhi-NCR region.
Similarly, Mumbai-based menswear apparel brand Mufti too is looking to double its Rs. 450-crore turnover in five years on the back of its latest store revamping measures.
It is imperative that India’s apparel market is majorly driven by menswear, which holds big share in the apparel business, accounting for 43 per cent of the total market. Womenswear contributes around 36 per cent, whereas kidswear constitutes 21 per cent of the clothing market.
H&M India, in the last five years, opened almost 50 stores, and the retailer believes that there’s no reason why in the next five years, it can’t open many more stores despite all pandemic-induced challenges. Its digital store too has been growing strongly (besides selling on Myntra) – not to mention that the fast fashion retailer witnessed a sales growth of 242 per cent in the 1 March to 31 May 2021 period. So, while fashion retail continues to grow and create job opportunities across the country, performance is even better for e-commerce firms.
E-commerce firms signal growth as volume and values surge and stores increase
India is a very large and fast-growing online shopping market, and it is imperative that e-commerce – especially fashion e-commerce – has incredibly changed the way business is done in India. At present, the e-commerce market is led by electronics category with a share of around 49 per cent followed by apparel and lifestyle which is around 25 per cent. Stating about online firms, though Amazon has established itself strongly in India over the last few years, what’s noteworthy is the pace at which many other e-commerce biggies like Flipkart, Snapdeal, IndiaMart, Myntra and Firstcry have grown recently and created jobs.
Amazon, which today retails over 1,000 fashion brands, has reported 40 per cent Y-o-Y growth in its fashion category in FY ’21 as the industry ‘re-strategised’ amidst the strict lockdowns enforced last year that prompted more users to buy goods online. Interestingly, 65 per cent of this demand emerged from Tier-2, Tier-3 and Tier-4 regions, the company said. In March 2021, Amazon said it has scaled up its ‘Local Shops’ programme to 50,000 offline retailers across 450 cities in the country, doubling the total number of sellers on the programme over the last four months.
Similarly, Snapdeal, a leading e-commerce firm, saw the sales of its fashion category grow by 210 per cent in the first six months of 2021. It witnessed volume growth in casualwear including loungewear (tracks, shorts, T-shirts, tops, dresses, etc.), athleisure sportswear and masks as people continued to work from home post pandemic-induced lockdowns.
Then there’s Flipkart which is presently on annualised gross merchandise value (GMV) of US $ 23 billion, of which, around US $ 20 billion is estimated to be from Flipkart, with the remaining from its fashion-focused platform Myntra, which has recently hired around 11,000 people, which is nearly 57 per cent up from 7,000 hiring done last year. Meanwhile, the e-tailer has strengthened its supply chain network in the Indian state of Haryana by adding four new facilities – a move that’s expected to create 12,000 job opportunities.
Notably, the overall order volumes for the fashion category across marketplaces as well as brand websites were up by 45 per cent in FY ’21 compared to the year-ago period, according to a recent report by Unicommerce. On the whole Indian fashion e-commerce seems to be on a good footing.
Watch out for our next series where we will talk about how mom and pop fashion stores are not only becoming a self-employment avenue, but are also generating ample employment opportunities for many.