December 6, 2020

Starting up in the Fashion Industry- A Legal Checklist

The fashion industry is a global hub devoted to the business of making as well as selling clothes and other fashion accessories. Fashion incorporates its prejudice of style, individual taste, and cultural environment and thus it is a basic industry on which major entertainment and many other industries rely. It is a multibillion-dollar globalized sector that encompasses the design, manufacturing, distribution, marketing, advertising, and promotion of all types of apparel.

Growth of Fashion Industry in India

Fashion in India has thousands of years of tradition behind it. However, the Indian fashion industry witnessed the effects of globalization due to which changes occurred in the dressing style of Indians, leading to many flourishing ideas in this field such as fusion of Indian and Western wear.

In recent times, the fashion industry in India has escalated very fast. The onset of the worldwide fashion market in India has given a thrust to the fashion industry, this has attracted so many young people to this industry. A report on the Indian Fashion Industry recently stated that the industry is expected to reach US$ 400 million in a couple of years with a vigorous growth of over 10 percent year-on-year. India’s growing strength in fashion is also due to the raw materials, having large production of cotton, silk, and man-made fibers all over the world.

Employment And Opportunities (Scope Of Business)

In today’s time, India has become a steady market not only for flourishing global brands but also for fast-growing Indian names in the Fashion Industry. The field of fashion designing is always expanding and the scope is not only limited to designing outfits but covers a wider area of design which consists of jewellery, footwear, etc. There are several institutions which have been established where the students are taught to transform their creativity in this field and thus creating numerous employment and job opportunities.

Major Stakeholders in the Fashion Industry

A company in the fashion industry has to deal with a large number of stakeholders like designers, sponsors, tailor, etc. Transparency and communication with these stakeholders are important for the industry to grow and succeed.

· Fashion Designer: A fashion designer is primarily responsible for designing and making clothing, footwear, accessories, etc. The responsibilities may include overseeing team members make their designs a reality and then marketing their designs for retail or other markets. The duties may include observing fashion trends, choosing a theme for designs and collections, creating prototypes for models, etc.

· Fashion Retailers: Fashion retailing is the process of buying clothes from the manufacturer and selling them to customers. The role of a fashion retailer includes identifying the right suppliers for the organization, ensuring a smooth transition of products, budgeting, and promotion of products, implementing change in strategy based on customer feedback.

· Fashion models: Fashion models represent brands and designers by wearing their clothing and accessories in photo shoots, commercials, and runway shows. Duties and responsibilities include posing for photoshoots, film commercials, style clothing, and makeup, maintaining photo shoots, etc.

· Fashion Promoters: The fashion promoter is a management organization that focusses on promoting and managing talents in modeling, fashion designs, etc. It works with businesses and companies to promote their products and services. The fashion promoter hopes to positively impact the fashion industry by motivating customers to choose clothing and accessories.

Starting up a New Business in Fashion Industry

Today many designers rush into setting up a business, attracted by the perceived glamour that is associated with the fashion industry. Running a fashion business means developing and following an organized creative process that works. The most crucial thing before rushing up to start a business is to craft the business concept. There must be a business plan which will help in fundraising. The other decisions must also include the allocation of the capital. Having a clear design methodology is crucial to getting the best out of one’s abilities. Apart from mastering the design process, something that some of the smartest designers do next is to find a business partner they can trust who brings different skills and connections to the table. Also in the industry of fashion, there is a need for support of people like designers, accountants, lawyers, stylists, photographers, managers, and interns. There is a need to get into the mind of the customers and to understand what motivates them.

Legal Checklist for Starting up of Businesses

· Fashion Designing Business: Any company is partially defined and determined by its structure. For Fashion Designing Business, the ideal business structure would be a corporation as it offers the strongest protection to its owners from personal liabilities. It can be a good choice for medium or higher risk businesses that need to raise money. For setting up of fashion designing business, there must be a proper plan, a decision of finding the right investors and partners, correct allocation of capital, design, and development, production, sales, marketing. There are few challenges faced by a fashion designer such as finances, lack of innovation, fear of theft of the designs, unable to choose the target audience, etc.

In fashion, the company needs to take branding seriously. This protection is the easiest and often the only intellectual property protection available for clothing companies. The copyright laws protect the way that an idea is put into a tangible form (drawings or other physical representations of designs). Another type of protection can be design patent, utility patent as well as trade dress. Here, fashion attorneys advise the clients on legal issues, i.e., running the gamut from licensing, distribution, franchising agreements to intellectual property employment, and labor relation.

· Fashion Event Producer: Fashion event producers work with designers and models, sometimes even coach them. They help the designer with runway show casting and have an understanding of how clothes should be portrayed and the way models should carry themselves. While start-up costs are minimal, there is no need for employees or even an office. The important thing needed is to do some heavy self-promotion. Relationships and referrals are key to this type of work. For this business, a sole proprietorship can be an ideal business structure as it can be a good choice for low-risk businesses. To be a successful fashion event producer, one must be organized, able to make quick decisions, and communicate effectively. The general legal glitches faced by fashion event producers are contract disputes, licenses, and permits issues, etc. An attorney can help to protect the company to hold-up the deal if the client refuses as well as helps the company to overcome the hurdles of red tape in obtaining permits and licenses.

· 3D Printing Business: 3D printing offers a wide range of business opportunities as it is steadily becoming one of the most popular trends all over the world. Today’s buyers demand mass customization, local production, sustainable materials, all of which 3D printing can provide. The legal structure for a 3D printing business can be the sole proprietorship and LLP. But since business is all about the income and interest of the clients, the LLP is the best legal entity of the business. The merits include a few restrictions, protected assets, limited requirements, and flexible management structure. The legal challenge that can be faced and where the role of Attorney comes into picture is intellectual property protection. There is a need to protect the 3D printing business including patent industrial design rights, copyrights, trademark, etc.

· E-Business: Internet helps business houses to cater to a global audience without any major investment. Most Fashion business houses maintain a website to sell their products and promote the products to a global audience. Apart from the fashion business houses, other e-commerce players in the game provide a market to all the sellers of fashion and clothing. E-commerce websites also integrate safe and convenient payment gateways. Also, e-business houses offer huge sales and discounts as compared to physical shopping. The easiest way to start up an e-business is as a sole proprietor because it is the simplest way to pull off by an individual. Also, e-commerce does not require substantial resources in the initial stages. An Attorney plays an important role to help in settling the common legal issue faced by e-commerce businesses such as incorporation problems, Trademark security problems, transaction issues, privacy issues, etc. There is a need to hire them before launching any e-business who can give proper advice about privacy, security, taxation, disclaimers, copyright, etc.

Conclusion

Since the last decade, the Indian fashion industry has moved from the embryonic stage to a blossoming take-off. The excessive increase of fashion based programmers on the media has increased the consciousness of the average Indian masses about globally changing trends. Thus, globalization has completely changed the face of our Indian fashion industry. This has opened the flood gate of opportunities for various aspirants and professionals to start-up new business ideas in this industry.

Author Details: Madhav Mantri (ICFAI Law School)

You might be interested to read:

  1. Remixes: Ethical or Legal?
  2. Intellectual Property Rights- Theoretical Justifications
  3. Concept of Originality and Subject Matter in Copyright
  4. Case Brief: Chappell & Co. Ltd. and Anr. v. Nestle Co. Ltd. and Anr. [1959] AC 87
  5. Trade Secret Laws in India
  6. A COMPARATIVE STUDY OF MORAL RIGHTS ACROSS JURISDICTIONS: A STUDY OF MORAL RIGHTS ACROSS JURISDICTION
  7. Traditional Knowledge- The Need for A Sui Generis Legislation
  8. BASICS OF COMMERCIALIZATION OF INTELLECTUAL PROPERTY ASSET

Leave a Reply