Apparel dominates MSME textile sales, accounting for 78.5%: Survey

Around 40.5 per cent of businesses encounter challenges with logistics and deliveries, while 32.5 per cent struggle to keep up with fast fashion demands. Skilled labour shortages affect 30.5 per cent, and 23 per cent face rising operational costs. Additionally, 21.5 per cent find customer acquisition difficult, and 20.5 per cent struggle with effective inventory management, as per the survey by Borzo (formerly WeFast).

Most respondents (38 per cent) reported an average order value between ₹1,000 and ₹5,000, making it the most common transaction range. A significant 23.5 per cent indicated orders below ₹1,000, reflecting a strong presence of smaller-value purchases. Around 22 per cent businesses have order values between ₹5,000 and ₹10,000, while higher-value orders are less frequent, with 7.5 per cent ranging from ₹10,000 to ₹25,000 and only 6.5 per cent exceeding ₹25,000.

Business models are primarily business-to-consumer (B2C) (70.5 per cent), with only 10 per cent focusing on business-to-business (B2B). The festive season significantly boosts sales, with 36 per cent of businesses reporting a 20-30 per cent increase in orders, while 24 per cent saw an increase of over 50 per cent.

Regarding logistics, 71.5 per cent of MSMEs in the sector ship goods worth ₹50,000-₹2,00,000 ($575.62- $2,302) monthly via same-day logistics. High delivery costs (63.5 per cent) and delays (49 per cent) remain key challenges, while 81 per cent view same-day delivery as essential. Fifty-eight per cent prefer a 30–60-minute delivery window, according to the survey.

Despite the rise in D2C sales, only 28.5 per cent of businesses operate their own website, with most relying on external platforms. Moreover, MSMEs seek improved logistics, with 56 per cent prioritising reliable same-day delivery, while 29 per cent aim to reduce costs.

Sustainability is gaining traction, with 70 per cent adopting eco-friendly packaging. However, high raw material costs (47 per cent) and processing expenses (19 per cent) drive up the price of sustainable fashion. Looking ahead, 59.5 per cent of businesses expect costs to decline, while 40.5 per cent remains sceptical.

“The perspective of MSMEs in the apparel and textile industry highlights the substantial efforts companies are making to keep pace with the ever-evolving demands of consumers. Since Indian MSMEs in this sector tend to be smaller and more fragmented compared to those in other countries, price alone isn't the primary driver of competitiveness. Instead, factors such as improving logistics efficiency, cost management, and a focus on sustainability are critical to staying ahead. The findings reflect the pressing need for more streamlined processes, pointing to challenges like high delivery costs and the growing pressure of fast-fashion demands as key drivers of change in the industry. It is essential for businesses in the sector to adapt quickly to these evolving needs to ensure long-term success and competitiveness,” said Alina Kisina, chief executive officer (CEO), Borzo.

The survey was conducted across 15+ cities, including Mumbai, Delhi, Pune, Hyderabad, Bangalore, Jaipur, Ahmedabad, Kolkata, Gurgaon, Noida, Lucknow, Indore, Chandigarh, Surat, Ghaziabad, Faridabad, Thane, and Nashik.

Fibre2Fashion News Desk (SG)