Top Countries To Start A Business in Fashion

Launching a fashion brand isn’t just about what you’re selling and how it looks – it’s about where you launch.

In today’s global economy, where you launch your business can affect everything from production costs and materials available to tariffs and brand perception.

If you are thinking about launching a fashion brand, but aren’t quite sure where to do it, then we talk you through everything you need to think about.

Why Does Location Matter When Starting A Fashion Business?

When it comes to a commodity like fashion, location can be incredibly important. This is for a number of reasons.

Cost

Since fashion involves the continuous creation of new items, it’s important to think about the cost of materials and labour – both of which can significantly eat into profit.

The cost of this varies a lot by country, so it can make a big difference to how products are priced and what overheads look like.

If you are thinking of launching your business in one country, but outsourcing production elsewhere, it’s worth looking at:

• China: The factory of the world, with low-cost production and good automation technology powering it.
• Bangladesh: Cheap labour with high output.
• Vietnam: High quality garments at low prices.
• India: Skilled workforce and access to a range of fabrics, including sustainable options like cotton.

Tariffs

Given fashion garments need to be physically sent to buyers, tariffs can have a huge impact on how items are priced to different buyers around the world.

With current trade tensions escalating, understanding the impact of tariffs on imports is an important part of any business strategy.

Access to labour

Whatever your product is, it’s likely you are going to need someone to make it!

Certain countries have populations highly skilled in different areas of clothing creation. For example, if you are planning to open a businesses that focuses on detailed embroidered items, the labour you look for will be very different from a company looking to produce fast fashion.

Consumer demand

The domestic market you choose to launch in will have a big impact on how quickly you are able to grow. If that country has a strong economy and demand for your brand, you’re more likely to grow fast.

Brand perception

Having a ‘Made in Italy’ label on your clothing can carry more prestige than a ‘Made in China’ tag.

This is because countries like Italy, France and even the UK come with a lot of weight in the world of fashion. Think about how this may affect brand perception to help you build a strong customer base from the start.

So, in order to answer the question of ‘what are the best countries to start a fashion business in?’, it’s probably worth segmenting it based on the type of brand you want to create.

Best Countries For Luxury Fashion Businesses

1. France

France is the home of luxury fashion, with world-famous brands like Dior, Louis Vuitton and Chanel within its borders.

As a location for the business, it helps sets the brand up as luxury, whilst also benefitting from free trade across the EU and strong trade agreements with economies like The UK.

Whilst the cost of labour is high, it’s definitely one to consider if you’re looking to launch into the world of luxury fashion.

2. Italy

As a world-leader in textiles and leather, Italy is known for being the home of high-quality garments, both from a materials and production perspective.

Italy is a great country to consider if you are looking to launch a slow fashion brand with a focus on quality and quality – not to mention its EU trade agreements, making it easy to launch across Europe.

Best Countries for Fast Fashion Businesses

1. The US

The US has a huge consumer culture, so it’s a great domestic market for any company looking to sell volume and fast.

However, it’s important to consider that if you plan to launch in the US you might want to produce locally to offset new tariffs being introduced by China, India and Bangladesh.

2. China

China is one of the best countries in the world for mass production and is a huge exporter of fast fashion globally.

Not only does it export a lot of clothing, but as one of the most populated countries in the world, it also has a huge domestic market.

However, it’s worth considering that China has higher import duties into the US and Europe which may limit external markets.

3. The UK

The UK is a hub of fashion activity, with a strong e-commerce sector and a fast fashion mindset. The UK is one of the wealthiest economies in Europe, meaning its domestic audience is ready to spend.

The UK also has a range of independent trade-deals post-Brexit, which may mean more favourable tariffs compared to the EU.

Best Countries for Sustainable Fashion Businesses

1. Germany

Germany is a country that prioritises sustainability and also has a strong online market.

With good logistics, an eco-friendly consumer audience and good access to all EU markets, it’s definitely one to consider.

2. Portugal

Portugal is known for being the home of small fashion brands that prioritise sustainable materials and ethical production. The country has a strong focus on circular fashion, with a market that prioritises transparency.

Portugal also benefits from EU trade agreements, making imports and exports easier within Europe.

3. India

India is home to many organic and ethical fashion brands, leading the charge in combining sustainable materials with ethical production.

It’s the 2nd largest cotton producer in the world, giving it great access to eco-friendly materials, not to mention a big domestic market – one of the largest on the planet.

Where Is Best To Launch A Fashion Business?

The truth is, no single country ticks all the boxes when it comes to building a fashion business.

If you are launching a luxury brand, France or Italy might be best for you.

If it’s fast fashion you’re after, think about the US, UK or China.

Alternatively, India, Portugal and Germany might be best if you’re focusing on sustainability.

Ultimately, in order to give your fashion business the best shot, it’s important to do your research and launch in a market that fits.

Good luck!