How To Start Wholesale and Retail Clothing Business in India

Clothing Business is becoming a profitable business in India. Because all the people who are living in this world need clothes. Nowadays, people have become more conscious about their dressing style. The first step to start a clothing business is deciding what types of clothes you are going to sell. You can sell sarees, salwar, tops, skirts, shirts, jeans, trousers, shorts, vests, handkerchiefs, scarves, etc. You can sell the products Retail or Wholesale.

Wholesale business

Wholesale means selling goods in large quantities at a low price. In Wholesale business, Wholesaler will buy the products from the Manufacturer and sell the products to the Retailer. It creates a link between Manufacturer and Retailer. When you start a Retail Business, you don’t need to do advertising. The wholesale price will be less than the retail one. It needs a large amount of money. Business location is not that much important. The field of wholesale business is larger than the retail one. A wholesaler will sell limited products.

Retail business

clothing business

Retail means selling goods in small quantities. In Retail business, Retailer will buy the products from the Manufacturer and sell it to the customer. It makes a  link between Retailer and Customer. A retailer will sell the products directly to the customer. Retail Business needs advertising. You can do Retail Business with the minimum amount. In a retail business, the location will take an important place. So select a place for the shop where you can get more customers. You have to speak effectively and sincerely about your product and service.

Art of selling (make the customer believe you through your speech) is necessary for a retailer. We can’t say that retailer always gets the products from the wholesaler. Within reaching in the hands the retailer, it may pass so many hands such as Vendor, Dealer, Distributor, etc.  At last, only it reaches the hands of the  Retail Shopkeeper. The Retailer will sell different products.

When you want to start clothing business,

  • Have enough money to purchase cloth stock
  • If you are going to manufacture the products of your own, get a good designer
  • If you are only going to sell the products wholesale, search for the best Manufacturer to buy clothes
  • When you want to sell the products Retail, you have to select the best wholesaler.
  • Select a suitable location
  • Decide a name for your business
  • Your designs must be something new, attractive and unique
  • Plan to gain maximum profit in your business
  • If you have merchant account only, you can accept the credit card orders.
  • Set up a website for your clothing business. List the products along with the product description and price on the website. You should display the pictures of the products.
  • Have a computer to maintain a database of the customers.

License and Permits

  • Get a Vendor’s license to sell clothes. If you get this license, you can collect the service tax from in-state customers. Obtain DBA (Doing Business As). DBA indicates whether an individual or a company doing the business under a fictitious name. When you want to start a business as sole proprietorship or partnership, you have the option to select your business name or DBA for your business. It is called fictitious name. It is not a corporate name. So fictitious name should not have the words ‘corporation’, ‘Inc’, incorporation’ and corp. In a sole proprietorship, one can operate a business. It is not a legal entity.
  • There is no need to register sole proprietorship in India. But you have to open a current bank account to receive payments in the name of your business. To open the bank account, you need 1. PAN Card and ID proof of the proprietor, 2. Business address proof such as electricity bill or rental agreement, 3. Shop establishment license, 4. Service Tax Registration
  • You can register your business as Limited Liability Company (LLP) for Tax advantages. Or you can register as Small Scale Industry (SSI).
  • Obtain EIN (Employer Identification Number), if you are planning to have employees. Most of the vendors need this number.
  • Obtain a permission from the trademark owner to sell his products. And get a resale license which will help you to purchase clothes without sales tax. When you resell the products, you can collect this tax.
  • When you are doing retail Clothing Business, you need Local Business License.

How to start a Clothing Business online?

Nowadays all the people sell their products online. It is the easiest way to sell the products. If you don’t have experience, talk to the experts and professionals in this field.

Don’t spend too much money. Think twice before you spend the money.

  • Set up a website for your clothing business. List the products along with the product description and price on the website. You should display the pictures of the products.
  • Name of your website (Domain Name) should be simple. Then only people can easily remember the name.
  • Plan how you are going to sell the products to the customer. Get a clear idea about your payment option. ‘Cash On Delivery’ is the best option.
  • If you have a Facebook page, update your products.
  • You can also sell your products online shopping sites such as, Myntra, Flipkart, Shopclues, Snapdeal, Paytm, etc. has got the first position in India among those shopping websites.
  • In the beginning, you don’t need any license. If your turnover crosses 5 lakhs, you have to register your firm.


Most of the people will prefer going directly to the shops. Because shops have a trial room. So they can do a trial. If the dress is not suitable means, they can change that. When you purchase online, you will not have this option. Online purchasing will take too many days to arrive. You can export the clothes to foreign countries. If you are new to this business, first start a Textile Shop to gain experience.

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