The UK makes £3.35bn from fashion startup, study reveals

With the revenue of the global apparel market expected to grow by 11% in the next four years, it comes as no surprise that more and more people are looking to start a fashion business.

With that in mind, the wholesale experts at JOOR conducted a study to find out which are the best countries to start a fashion business.

JOOR’s index study considers the following factors: country population, import and export figures, apparel market valuation, and number and valuation of ‘unicorn companies’ in the consumer and retail market (in business, a unicorn is a privately held startup company valued at over US $1bn). After analysing all the factors above, a final score was created to identify the best countries to start a fashion business.

The BEST countries to start a fashion business

Country	Population	Export/ Imports	Average Apparel Market Value Annual Growth (%)	Number of unicorn companies per 1 mil people	Unicorn Startups Sum of Valuation (Billion£)	Final Business Score/10
United States	331,002,651	6.9903	2.70%	0.227	178.43	9.27
United Kingdom	67,886,011	5.5703	3.00%	0.044	3.35	8.61
Canada	37,742,154	6.69	3.50%	0.079	12.35	8.48
Germany	83,783,942	2.0868	2.20%	0.107	11.08	7.93
China	1,439,323,776	0.1274	6.30%	0.035	182.6	7.88
France	65,273,511	2.8178	1.40%	0.107	14.42	7.83
Colombia	50,882,891	3.2831	10.90%	0.039	4.8	7.77
India	1,380,004,385	0.2418	7.40%	0.019	53.5	7.62
Norway	5,421,241	22.6293	1.50%	0.369	1.52	7.54
Singapore	5,850,342	6.6794	2.90%	0.513	3.1	7.53

Note: Export/Import ratio is a value that compares the value of a country’s exports (in the clothing and textiles industry) to the value of imports. A value greater than 1 suggests a country exports more whilst a value less than 1 indicates a trade deficit, the country imports more than it exports.

The full dataset can be found here.

JOOR can reveal that, based on the above factors, the best country to start a fashion business is none other than the United States, with a score of 9.27 out of 10. The ‘land of opportunity’ has an impressive valuation of £178.43 billion when it comes to consumer & retail unicorn startups, giving a lot of hope to new entrepreneurs who want to start a fashion business. Furthermore, the export/import ratio of 6.99 shows that there is a higher export efflux, suggesting a surplus of materials and a well-performing market. When it comes to market value, the study shows an annual growth rate of 2.7%.

In second place is the United Kingdom with a score of 8.61. Although the annual growth rate of the apparel market is higher than in the United States (3% annual growth), the valuation of unicorn startups in the consumer & retail space is significantly lower for the United Kingdom, at £3.35bn. The United Kingdom also exports more than it imports, having an export/import ratio of 5.57.

Canada is the third best country to start a fashion business, with a score of 8.48/10. The value of unicorn startups comes to £12.35bn, whilst the market value for fashion and retail grows at a steady rate of 3.5% yearly. Canada also exports more than it imports, having an export/import ratio of 6.69.

In fourth place is Germany, with a score of 7.93/10. When it comes to consumer & retail unicorn startups, the valuation sum for Germany is a whopping £11.08bn. Furthermore, the export/import ratio is 2.08, showing that Germany exports more than it imports. The apparel market value in Germany grows at a 2.20% rate yearly.

China is the fifth best country in the world to start a fashion business, with a score of 7.88/10. When it comes to unicorn startups for consumer and retail, China takes the lead, being valued at £182.6bn. Furthermore, China sees a tremendous annual growth rate for the apparel market value, at 6.30%. However, China also had the lowest export/import ratio in the top 10 countries, at only 0.12.

Methodology:

1. *Global Apparel Market Growth Data.
2. Country Population was sourced from Worldometer. The population is a good indicator of the potential customer base and the workforce of a country.
3. The import/export data by country for textiles and clothing was sourced from the World Bank. The latest data available across all countries was for 2020. A high export/import ratio is considered desirable as it suggests a surplus of materials and a well-performing market.
4. The value of the apparel market by country for 2016-2020 was sourced from shenglufashion.com which included the compound annual growth rate for the market in each country.
5. Lastly, the number of current unicorn companies in consumer & retail was included to indicate the potential for highly successful fashion start-ups. Unicorn companies are businesses that reach a valuation of $1 billion without being listed on the stock market.
6. The final dataset was compiled from countries that had complete data for steps 2-5, and were percent ranked to find the most influential country for a fashion start-up.
7. All current unicorn companies were scraped from CB Insights and filtered for the consumer & retail industry, giving a total of 214 companies worldwide. As the industry breakdown of unicorn companies didn’t go as specific as fashion, consumer & retail was considered.  While the total value may be inflated based on the inclusion of non-fashion consumer & retail companies, it is still a reasonable estimate for comparative purposes across countries.
8. All data is correct as of 27/06/2023.
9. Image credit: Gorodenkoff/Shutterstock

25/07/2023