Fashion is an industry that runs on change with new trends, styles, and whole new ranges offered up every season. In order to meet those demands, it must keep the supply chain working at full steam to stitch up and ship out new fashions at breakneck speed.
With its focus on the front end to deliver a continuously changing collection of fashion, it has, by necessity, been slower to change the many moving parts of the industry’s back end.
So, it has been moving at a measured pace to meet the growing demand for sustainable fashion and a more environmentally and socially-responsible industry.
As one of the world’s dirtiest industries, fashion has recognized its responsibility and formed the Sustainable Apparel Coalition (SAC) comprised of 250+ members to change the apparel, footwear, and textiles industry so that it “produces no unnecessary environmental harm and has a positive impact on the people and communities associated with its activities.”
But given the ambitious goals of creating a sustainable fashion industry and the scope of change required to meet them, the industry’s progress has been slow.
“Fashion companies are not implementing sustainable solutions fast enough to counterbalance negative environmental and social impacts of the rapidly growing fashion industry,” reports The Global Fashion Agenda in its Pulse of the Fashion Industry 2019 study.
Now the global coronavirus pandemic has brought sustainability to the fore. As an immediate threat to everyone’s health, it demonstrates how fragile we are as human beings and how our future health and happiness depend on a healthy environment.
Fashion’s drive to sustainability is on hold
But now when it needs sustainability most, the fashion industry has been forced to put its sustainability transformation on pause, reports Boston Consulting Group, SAC and the Higg Co. in a new study, “Rebuilding a More Sustainable Fashion Industry After COVID-19.”
“The fashion and luxury industries together are the most negatively impacted of all in consumer goods,” says Sarah Willersdorf, BCG’s partner and global head of luxury.
“We are looking at sales being down 30%-to-40% globally. Most companies are just trying to survive by focusing on protecting their people and also their cash and liquidity,” she continues.
It’s strained the industry almost to the breaking point. BCG’s research finds that 86% of the more than 500 manufacturers surveyed have been severely impacted by canceled or suspended orders and 40% are struggling to pay employees and their suppliers.
As a result, sustainability has been put on the back burner, but right now, the industry needs to accelerate it.
“Sustainability is going to be table stakes for consumers when it comes to brands, both current and future consumers, and I don’t mean greenwashing, but real sustainability,” she explains.
“The best thing to come out of this very painful time is that we as individuals understand that our individual actions have societal consequences,” Willersdorf adds. “So while the virus is not directly related to sustainability, it is going to increase the focus on it.”
Sustainability matters to everyone
In so much as the drive to fashion’s sustainable future has been primarily consumer-led, Willersdorf sees it as a growing concern for fashion company employees as well.
“The same people who are consumers, on the one hand, are employees on the other. When executives, managers, and employees get behind sustainability, it can have a positive self-reinforcing impact on company culture. This is an aspect that isn’t talked about enough,” she says.
Any fashion company is only as good as the talent it can attract and the fashion talent of the future are going to want to work for fashion companies that make sustainability and social responsibility a priority.
“For the next wave of employees, this is going to be non-negotiable. They will make choices on where to work, just like consumers do about which brands to buy. Today, both consumers and employees are looking for purpose-built companies,” she says.
Immediate advantage goes to sustainable brands
Coming out of the crisis, things are likely to get worse before they get better. “Consumers are going to spend less for the foreseeable future,” Willersdorf warns.
“And they are going to be far more selective with a mindset toward quality, value and sustainability. They will be concerned about where fashion comes from, that it is ethically manufactured, and that it is as good as it can be for the environment,” she continues.
The time consumers have spent at home caused a radical reset to their priorities which will be reflected in their lifestyles going forward. As a result, they are going to look for brands they can trust and pay attention to the “collective good,” most especially in product categories like fashion and beauty that are considered close to the body.
The fashion winners coming out of this, Willersdorf contends, are the ones that have already “incorporated sustainability into real business practices. This will drive advantage.”
On the other hand, the losers will be brands that have been slow to realize how important sustainability, environmental, and social responsibility are to their current and future customers. “Their economics are going to be competitively disadvantaged if they haven’t moved towards this,” she says.
For those slow-starters, she sees collaboration, as in the work of the SAC, as a critical
“Historically, the fashion industry hasn’t been big on collaboration, but this area of sustainability might just be an area where there’s a way to share costs and benefits more broadly across multiple partners. Survival of the industry may well depend upon it,” she believes.
It’s not too late
In closing, Willersdorf stresses that sustainability is going to prove to be essential to the long-term economics of every company in the fashion industry.
“This is in part because of a long-term positive impact on the supply chain, since we otherwise expect there to be an increased cost of labor and other resources,” she says.
Where the long-term positive impact will be realized is by the very experience of looking at existing processes and business models and finding innovative new practices and strategies to shore up weaknesses and solve problems.
“Sustainable business practices can uncover new revenue streams, reduce risk, and lead to better business models,” Willersdorf says.
By rising to the sustainability challenge and doing it faster than the slow, methodical pace of the past, fashion companies will hone an innovation skill set within their ranks, which innovation experts assert it is a mindset that can be learned.
What’s more, it is the very mindset that every fashion company needs to secure its economic future.
Article via Forbes.