adminser Retail and Fashion have been the hardest-hit sectors in recent months. According to a recent report from the Sustainable Apparel Coalition, foot traffic at retail stores has dropped by over 50% in other countries and by more than 44% in the US. Manufacturers have also had to cancel large quantities of orders further up the supply chain.
Retail and Fashion have been the hardest-hit sectors in the last few months. According to a recent report from the Sustainable Apparel Coalition, foot traffic at retail stores has dropped by over 50% in other countries and by more than 44% in the US. The Sustainable Apparel Coalition reported that foot traffic in retail has dramatically decreased by 44 percent in the US and over 50 percent across other countries.
Many have accused the fashion industry of being broken for years. Fast Fashion has been a model that has taken advantage of the economic growth of the North over the past decade. This model is characterized by large collections that offer a wide range of choices to customers. It also features frequent discounts, low-quality clothing, and cheap prices.
The pandemic and the subsequent lockdowns of countries all over the world have taught us that environmental issues and economic and social issues are interconnected. Also known as the “Triple Bottom Line”. The time spent in quarantine forced us to reconsider the meaning of “normality” and our daily norms. Masha Birger of sustainability consulting company ESG Alpha stated:
The crisis has forced us to reconsider our values, our relationships with others, our work-life balance, and our lifestyle in general. Let me give you an example: I cleaned my closet. What’s left is a capsule wardrobe of well-made, multifunctional classic pieces. Birger said, “I am more focused than ever on buying sustainably made items and buying less in general. I’m not the only one.” The fashion industry must adapt to this new reality. With people around the world demanding economic, social, and environmental change, companies need to reassess and re-evaluate their priorities.
Companies of all sizes have used the word “pivot” to describe their process of adapting to new ways of trading. It mostly involves developing their online working abilities. Many are still looking for ways to become more resilient and gain a competitive edge. The fashion industry would benefit from a reshaping of business models in order to make them more sustainable.
From a marketing standpoint, it’s well-known that being able to boast about environmentally friendly operations and social initiatives can be an advantage. It builds trust among customers, existing and prospective. Rethinking the materials used in garment production is one of these operational changes. Gucci, the global brand, has launched its first sustainable collection, ‘Off Grid,’ using recycled, bio-based, or sustainably sourced material like Econyl. Belarus Fashion Council has really capitalized on the PR benefits by raising awareness about plastic pollution during Ethical Fashion Week.
It’s a positive step forward. Birger, however, believes that Fashion is not sustainable enough. All stages of production must be sustainable, including managing waste and water, limiting chemicals and GHG emissions, and protecting workers.
Forbes recently interviewed Anna Gedda, the head of sustainability at H&M Group. She discussed how fast fashion companies view sustainability in a post-Covid environment. Gedda admitted that the pandemic was one of the biggest challenges the group has ever faced. One of the major issues was the closure of stores. At its peak, 80 percent of the stores were closed. That’s a big number for a group that owns 5,000 locations worldwide.
They focused on maintaining a certain level of revenue while ensuring the safety of their staff and customers. Net sales fell by 50% despite an increase in online sales. Gedda assures that their concerns remain with the supply chain, and they make every effort to support suppliers. The challenge was to fulfill orders, continue to pay suppliers, and minimize losses. H&M Group has certainly had a tough time despite its size. However, the slow but steady recovery on the high street can provide some comfort.
Since lockdown, the question of whether Fashion will be the same ever again has been asked a lot. In a very short time, not only were company and operations strategies changed dramatically, but also customer expectations and values. In general, we’ve become more selective about what is important. It is expected that online sales will continue to grow, and physical locations will become less important. We found that the companies that were slow to move online, such as some of the “big players,” were the ones most at risk. This is a reality in most industries and not just Fashion.
Covid expects environmental sustainability to be the focus of its conversation on economic recovery, and many companies want to be more resilient to future events. This can be achieved by developing a circular business model that often leads to being self-sufficient. Gedda said that she believes “sustainability must be affordable” and that many jobs would be created if the model were successful.
H&M Group has already taken steps towards sustainability by using more sustainable materials. It includes less-impactful sourcing and the use of recycled stocks. The garment collection program allows this, and there are plans for entering the rental market, which is regarded as a major part of Fashion in the future. Gedda, however, remained realistic. She said that there was still a lot of work to be done. The transition to a circular model requires patience. It is a complete redesign of the way products are manufactured and designed to be reusable and functional past their end-of-life. Gedda made an interesting suggestion that products should be able to have multiple uses, i.e., garments could be worn with different aesthetics and appear as brand-new products.
The pandemic was a catalyst for change in the fashion industry, and H&M Group in particular. However, they had already been making progress even before COVID-19 reached the world. Treadler, a well-established platform that allows external companies to access their global supply chain, was one of their initiatives. This network allows for more connections to be made around the globe to promote sustainable practices in the fashion industry. This allows H&M Group, from a business standpoint, to diversify its revenue stream while influencing and facilitating the development of more sustainable supply chains by other companies.
Transparency is one of the most important themes in sustainable business. The group works hard to provide information on how, where, and by whom their products are manufactured. The customer can make an informed decision, and they feel in control of their impact on the world. Transparency is key to building customer loyalty and trust.
Blockchain is a really interesting innovation. COS, a brand of the H&M Group, partnered with VeChain’s blockchain platform earlier this year to allow customers to view the complete history of a recycled wool jumper. The customer can read the history of a sweater by scanning the QR code on its garment tag. Gedda discussed Arket, another member of the H&M Group and brand that has also tried this technology.
Circularity is still a relatively new concept in the fashion industry. The group intends to integrate a circular mindset into its brand ethos. H&M flagship stores in Stockholm will allow customers to rent pieces from their previous exclusive conscious collections. Renting is seen as an effective way to meet the needs of customers who value access over ownership.
Gedda and the H&M Group have some exciting plans in the works. The fashion industry is taking sustainability very seriously.
