Clothing and Footwear 0

Key Project Information

 Purpose of loan: Increase working capital

Limit: €250,000 

Loan term: 365 days

Annual yield: 26.4%

Interest becomes payable: From the day of investment 

Intervals of interest payments: Weekly

Repayment of principal: At the end of the loan term


Key Borrower Information

 Legal form: Private limited company

Country of incorporation: England, UK

Established: In 2010 

 Main business activities: Wholesale of clothing and footwear

 Business sector: Textiles, clothing, leather and footwear sector


Investor Security & Early Exit Options

The loan is guaranteed by the Borrower’s shares

The loan may be offered for sale on TFGcrowd’s Secondary Market

Useful Links

Learn more about the Company.

Borrower’s Business Model

Have you ever wondered where do all those beautiful clothes and shoes in the shops come from? Although you may find garments made within the EU, this will probably be in small, boutique-style one-off shops, which sew the garments by hand themselves.

When it comes to the large bulk of fashionwear and footwear - these mainly come from countries far outside Europe. This is primarily because labour costs within Europe have soured to such levels that it is impossible to compete with countries like India, China, and Turkey when it comes to clothing production, even when you factor in transportation costs. 

Large worldwide famous luxury fashion houses were the sector leaders and established their operations in these countries to reap the benefits of highly-skilled yet low paid workforces. Cheaper brands followed. They would make the designs, send them off to the factories in India, China or Turkey and receive ready-made, high-quality fashionwear that fit their brand every season. They even sewed on the labels for each respective brand. All that was left was to iron the clothes and put on the displays for buyers to shop.

Led by the demand from large brands, these countries developed the fashion production sector to impeccable levels. Not every shop in Europe could make the necessary contacts or arrange seasonal visits to the fashion producers in these countries, though. Even if possible, the added costs of transportation of small batches would mean that the profits would vanish before realised. 

This is where fashion wholesalers, such as the borrower, come into play. Early on, they realised that it made much more sense to import the clothing and footwear from these countries for wholesale in Europe rather than try and source it locally at higher prices. And so, the era of affordable fashion began. 

The borrower is an experienced operator in the clothing and footwear wholesale industry and specialises in sourcing cheap, no-brand clothing and footwear from China, India and Turkey. Because they can order in bulk, the prices are affordable and smaller shops can either sew on their labels or choose to sell them without a brand name.

So, you may ask - how does it work in practice? The borrower's fashion specialists make regular trips to the factories and pick the following season's clothing and footwear. Their picks are vacuum pressed and loaded onto ships in large containers to ensure the most cost-efficient transportation. Once these arrive in the warehouses in Europe, shop owners can choose the garments that they believe fit their customers' tastes. This works out much cheaper for the shopowners than making seasonal trips to the producing countries, so their customers can benefit from lower prices, and shops can earn higher profit margins.

Market Outlook

Europe has a vast market for clothing and footwear compared to other parts of the world. The statistics related to the clothing and footwear market in the EU reveals an excellent insight into this industry. Around 21.3% of the global textile and apparel in terms of market value was imported by EU countries alone. EU is the top importer of apparel and in 2019, approximately 34 billion units of apparel were imported compared to 31 billion units in 2014. 

The below data shows that 49.6% of the import in terms of value was from the inside countries of the EU in 2019. 39.9% of imports were from the rest of the world and 19.5% of the imports were from the developing countries.

The top 5 most demanding apparels are knitwear, pants, trousers and shorts, bodywear, fashion sportswear and T-shirts. The average growth rate is 5% per year but active sportswear, Dresses and swimwear are getting the highest growth recently. The below graph illustrates all the important data related to the trend in the demand for different apparels.

The size of the expenditure on clothing and footwear by different countries in the EU can give a detailed idea about the opportunities that are waiting to be taken. The below graph shows the data of expenditure on clothing and footwear items, ranked by the amount spent in million GBP by the top 10 countries in the EU. UK and Germany comprise the biggest market for clothing and footwear.

Europe has a very demanding and high growth apparel market. In 2019 EU countries combinedly imported around €177.3 billion worth of apparel and this import amount has been growing at a rate of 5% per year. EU mainly imports from the developing nations and UK, Germany, Italy, France, Netherlands and Spain represent 72% of the imported value in 2019.

The above graph shows the annual turnover of the clothing and footwear wholesalers in the UK from period 2008 to 2018. All the amounts are in million GBP. The graph shows that the annual turnover in all of the years is above 10,000 million GBP and the graph is trending upward slowly. In the post COVID world there will be huge demand for apparels as the apparels market did not perform well during this period. So, there is a huge opportunity of wholesale clothing and footwear business because of the enormity of the market size and the annual growth rate related to it.

There are a lot of companies competing in the UK apparel market. The above graph shows the number of companies according to their turnover size acting in the wholesale clothing and footwear industry in the UK. According to the data most of the companies have annual turnover ranging from £0 to £249,999.

The above data shows that the UK import value increased at a rate of 2.6% annually from 2014 to 2019 but the import volume fell by 3.4% in the same period of time. That means that the price must have increased and therefore the margin in the apparel business shows a promising return. China and Bangladesh are the largest exporter of apparel in the UK.

By considering all of the facts Europe is a very good market for doing apparel and footwear business. But recently there has been a move toward sustainable clothing in the different countries of EU. The regulatory bodies are also promoting sustainable and green clothing that does not harm the environment. Also, there is a trend toward the wearable technology and smart clothing. This wearable smart clothing is expected to see high growth in the near future.



Loan term
365 days
Interest rate
26.4% per year
Expected Return