Kids Garment Manufacturing Business in India

Narendra Kumar

17 Oct, 2019

Kids Garment Manufacturing

The Indian Textile Industry is one of the largest textile industries in the world. The Kids garment manufacturing industry in India is gaining a foothold because of rising demands and also because this business can be started on a small scale with small startup capital investment. India is a booming market for kid’s wear – both for branded and non-branded products. Brand awareness and consciousness, dual-income households, affordability and tech-savvy millennial thought process is the main factors behind the phenomenal shift.

Kids’ apparel means clothing for kids aged 1 to 14 years.

How is the Industry Poised in India Currently?

The value of the kids’ apparel market in India was estimated to be about Rs. 61,201 crores 2016. It is estimated that the kidswear market will grow at a Compound Annual Growth Rate of 10.5 % in the next decade to touch Rs. 1, 66,147 crores by 2026. Of the above figures, the boys’ wear market contributed to 51% of the total kids wear market and the girls’ wear market accounted for the remaining 49% of the market.

As per available Government statistics, in the boys’ kids wear section, uniforms, T-shirts and bottom wear have been the dominant categories with T-shirts and denim growing at a CAGR of 12 and 15 percent respectively.

In the girls’ kidswear market, uniforms and ethnic wear have been the primary growing segments whereas western wears like T-shirts and denim are growing at a CAGR of 16 and 14% respectively.

As per a World Bank report in 2015, about 29% of India’s existing population is under the age of 14 years – hence India is a lucrative market for international and local apparel brands to compete and co-exist with each other.

What are the Necessary Compliances for kids Garment Manufacturing Units?

The following registrations and licenses from various Government bodies need to be in place for the garment unit to start manufacturing:-

1. Business registration with ROC either in the form of Company Registration of LLP Registration
2. Trade license
3. Udyog Aadhaar MSME Registration to take advantage of government schemes like loans without guarantee, easier loan procedure and low rate of interest against loans.
4. GST Registration for the business

Other than this there are other quality-related licenses for fabrics and decorative used for making kids’ clothes. These need to be procured to guarantee that the clothes being manufactured are made from fire-resistant and waterproof fabrics, zero risks of hazardous chemicals that can cause rash and allergies to young skin and minimal use of features like sharp buttons or drawstrings that can be risky for the kids’ life.

Some of the certifications that hold importance when garment manufacturers tie up with sellers are:-

1. ISO 9001 certification as one of the most trusted quality management system created by the International Organization for Standardization.
2. SA 8000 by Social Accountability International for compliance related to protection of human rights in the workplace.
3. Fair Trade created by World Fair-Trade organization for fair wages and working conditions compliance
4. Global Organic Textile Standard (GOTS) for use of organic materials.
5. FLO-CERT for fairness in the supply chain
6. Blue sign that certifies that the factory does not use harmful substances in production ensuring consumer safety, water, and air pollution parameters.
7. Fair Wear Foundation certification for better workplace conditions
8. Worldwide Responsible Apparel Production (WRAP) that works on 12 principles ensuring ethical, humane and safe production.
9. Made in Green by OEKO-TEX ® is a label that certifies the product is manufactured using environmentally friendly practices.

For the export market, the Apparel Export Promotion Council of India (AEPC) is an apex body that promotes apparel export and works in the areas of social and work environment compliances to make India a globally compliant manufacturer and exporter of apparels. With DISHA (Driving the Industry towards Sustainable Human Capital Advancement) the body regulates the following through the common code of conduct:-

1. Use of child and forced labor
2. Guarantee of minimum wages and benefits
3. Non-discriminating work culture
4. The competitive, challenging and safe work environment

A certificate is awarded to the Kids Garment Manufacturing after a detailed audit of the factory to ascertain gap analysis with DISHA guidelines. In case there is a substantial gap, the council trains and guides factories on upgrading methods and techniques.

For making any kind of exports they are also required to get the Import Export Code.