15 min read

Why a clothing business is profitable

October 25, 2021

Although the health emergency has wreaked economic havoc, the retail segment for clothing, jewelry and accessories registered growth. This shows that it is a profitable business. 

During the fourth quarter of 2020, there was a 22% growth in the GDP generated by this segment, when compared to the previous quarter, according to figures from Data Mexico portal.

Data Mexico reports that the states with the highest production in this economic activity were: Mexico City ($16.5 billion pesos), State of Mexico ($8.83 billion pesos), and Jalisco ($3.88 billion pesos).

Besides, were you aware that Mexico is the fifth largest exporter of textile and apparel products to the United States?

From January 2019 to March 2021, Mexico exported 1.612 billion dollars in textile and apparel products mainly to the United States (85%), El Salvador (4.3%), Nicaragua (1.7%), Canada (1.3%) and Guatemala (1%), based on data from the National Chamber of the Textile Industry (Canaintex). 

During the period from January 2019 to March 2021, according to Canaintex figures, the United States imported 8.78 billion dollars of manufactured goods from Mexico. From 2018 to 2021, pants (headings 6203 and 6204), followed by surgical towels (heading 6307) and T-shirts (heading 6109) were the most exported products from Mexico.

For the period from January to March 2021, the United States imported 957 million dollars of ready-made products from Mexico. Pants (headings 6203 and 6204), surgical towels (heading 6307) and T-shirts (heading 6109) were the most exported products from Mexico during this period, according to Canaintex.

Digital channel has also shown the demand for clothing, due to the fact that in the last Hot Sale 2021 campaign, the Fashion category was the favorite of online shoppers by positioning itself in first place above Electronics, Beauty and Personal Care and Household Appliances. According to the Online Sales Association (AMVO), the average ticket in this category was 1,700 pesos and only 29% of the tickets were less than 1,350 pesos.

Business niche

The data presented in the previous paragraphs indicate that it is a great opportunity, but if you want to start a business, the first thing you should consider is which niches exist. Therefore, here are some business ideas that you can explore:

On-demand printing: It is relatively simple to implement this model because it allows you to customize the pieces you want to distribute. Also, it can be done with a great diversity of garments such as sweatshirts, t-shirts, blouses, dresses, socks, etc., and the supplies are easily affordable.

Additionally, in this niche you can take advantage of certain dates (Christmas, Day of the Dead, Day of Love and Friendship, Mother's Day, among others) to offer clothes with space prints. Or you can also choose to focus on a theme such as iconic movie scenes, rock bands, writers, or anime.

Second-hand clothing: A trend increasingly gaining popularity, especially on social networks like Instagram. On this social network, the trend that is gaining strength are the so-called vintage clothing bazaars or second-hand clothing bazaars. It is not a physical space as such, but virtual bazaars in which with a certain periodicity the creators, mostly women, publish clothes that are for sale. 

What is favorable about this alternative is that it is not necessary to have a physical store, because the sale is made through the digital channel; while deliveries are made in certain subway stations or metrobus in the case of Mexico City. Most of them have shipping options to other states through Correos de México postal service.

It is still possible to create a more specific bazaar within this niche that manages to differentiate itself from the wide offer that currently exists in social networks. An example, Domesticados is a bazaar with presence on both Instagram and Facebook aimed at selling only vintage clothing for women that belongs to very specific periods such as the 60s and 70s. 

Watch out, the main challenge of this niche is to understand the tastes of your audience and the trends, and to have the patience to look for pieces in good condition and that can be appealing to your potential customers. 

You must, on the other hand, take into account that the attractive side of this niche is that it is a more sustainable way of consuming these products. It is something extremely attractive to younger generations such as Millennials and Generation Z.

Creation of your own line of accessories or clothing: This option is one of the most challenging, but most attractive to many customers. Compared to the previous options, this case requires more time and investment because you would be in charge of designing, choosing materials, patterns, as well as creating a wide production line in different sizes. Naturally, you can always choose commercial partners to help you. 

Just like selling used clothing, social networks can also be helpful to publicize your clothing line. It is increasingly common, for example, for lingerie clothing brands to promote and sell themselves through Instagram. Those brands consist of one to four people who make and sell the lingerie, something that can be well exploited since they are made to fit exactly to the size and taste of people.

Clothing repair: it is highly possible that after the economic and health crisis, people's habits have changed. This includes the fact that people used to throw their clothes away, but now they may be accustomed to making them last longer (a behavior also to help the environment). Such a business can be set up in a very small way, from home, or in some premises, which doesn't need to be very big.

The concept has been upgraded a lot with the emergence of specialized chains and franchises, but there is still a lot to do, particularly leveraging the boom in online clothing shopping. In other words, people buy clothes they like, but since it is a virtual purchase, the garment may not always fit well. You can benefit from this concept of repair specialized in these situations or you can also complement it with the sale of clothing and accessories.

Requirements to start a clothing sale business

After having a market niche, it will be time to take your pencil to transform your idea into a business plan, the most essential tool when you want to start up a business, no matter the entrepreneur's experience or the size of the project.

A business plan objective is to determine the feasibility and feasibility and profitability of a project in the medium and long term. This will enable you to draw conclusions and decide whether the company should finally be incorporated, assuming controlled risks, or whether the business idea should be further improved, preventing a certain failure.

This way the entrepreneur can conduct an in-depth study of all the variables that may affect his idea, providing the necessary information to determine the viability of the project.

The business plan can also serve as a letter of introduction of the entrepreneurs and the project to third parties such as financial entities, investors, public agencies, etc. For this reason, before making a business plan, you must have a clear idea of what you want to undertake. 

Please, keep in mind that making a business plan will allow you to analyze your original model, structuring and adjusting the project in order to reduce risks as much as possible. Among the aspects that can be analyzed, for example, is the most viable store model to start your venture in the clothing industry. 

All this analysis and strategic planning work may help you to understand more clearly if your idea is viable and profitable.

Models of clothing stores

Once again, a clothing store is not necessarily about one specific model. Deciding which model is best suited to meet your business objectives is up to you, though you could also mix both by opting for an online store and a physical space at the same time. 

Here are some of the store models that could work for your business:

  • Online store: start with Facebook or Instagram, or a website professionally developed to be able to process online payments. You can also use applications to sell, but remember that it is not easy, because of the huge offer available and you have to learn how to pay for ads.
  • Printed catalog: several brands give you a catalog to sell. This is good if you want to start a business with a small budget. You can start with clothes and accessories and then add other items. 
  • Boutique store: is a clothing or beauty accessories store with a premium and quality offer of different sectors and items that are manufactured on a non-mass scale.
  • Imported clothing: you should import clothing if you want to distinguish yourself from the competition or import things not available in your country. Opportunities are plentiful and there can be great profit margins.

Independently of the model you choose to implement, at the beginning the Buen Fin (best sales weekend) campaigns are an option to make yourself known and try to reach the largest number of people. Always remember it is not only for big brands or companies, because in every edition the organizers try to get more small and middle-sized companies to participate in the event.

New opportunities open up for online shopping

Maybe you are not necessarily interested in starting a clothing business right away, but you do want to get to know the industry and complement it with other knowledge. A feasible way to do it might be to start with a specialized fashion blog in which you begin to generate content about a certain niche. 

As soon as you get an interesting volume of visits, you have to think of ways to generate monetization of that traffic. You can also write an ebook about fashion tips and sell it online, make agreements with stores to collect a commission on sales coming from your blog or organize webinars about the fashion industry. 

Alternatively, if you are passionate about the fashion industry, becoming a personal shopper is a possibility that can be explored by people who are passionate about fashion. This is about making shopping choices that best suit the client, usually in clothing and accessories, but not only. You can also do it for personalized gifts, for example.

It can also be used as a complement to the work of an image consultant because, for example, you can advise on hairstyle, clothing, makeup, and even body language (non-verbal language). There are even TV shows about it; therefore there is interest in this work. You have to analyze if there is market potential for your own business that you can do alongside your boutique or online store.


You have probably noticed that clothing industry is extremely broad and you can find the niche that best suits your budget and entrepreneurial objectives. But do not close yourself to only one type of business model.

New tools are emerging and new habits have opened up more possibilities to start up and start in the clothing industry, from a virtual bazaar of second-hand clothes to starting an image consulting agency or a personal shopper. 

However, consider that for any of the niches and models you should always think about how you are going to distinguish yourself from the supply and think about always trying to provide a good customer experience ranging from customer service, options of payment methods (remote, transfers, point of sale terminal) and availability of products.

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