How fashion retailers can unlock a better fashion industry.
For decades, consumer demand for more responsible products has been on the rise as people have become increasingly aware of the environmental and social costs of the fashion industry. Knowledgeable and inspirational environmentalists have been advocating to preserve and protect the world’s natural resources, naming - and shaming - the fashion industry as the second most pollutive industry. An overwhelming number of certifications and standards have been developed by legislators, NGOs and businesses to offer some form of recognition to the eco-friendliness or fairness of the products we wear. In addition, new technologies, like blockchain, are increasingly used to track and trace global fashion supply chains.
So why is it that, today, it is still challenging for most consumers to find ethically or sustainably sourced clothes?
At the vast majority of fashion points of sale, both online and physical, little information is shared about the origin of the clothes on offer, even when this information is available. Is it because there is not much good news to share? Or will information about the better sourced origin of one product reflect badly on the other products, or on other activities of the business?
Most (multi-)brand fashion retailers have not yet fully embarked into the world of environmentally friendly and ethical fashion. It is not necessarily that they are not eager or interested. Rather, the current systems within companies and the industry as a whole, molded over decades entirely to maximize revenues and profits, make bringing about change very challenging. But, if the willingness is there, there are ways to put ethical and sustainable practices at the forefront and accelerate change.
Three questions for fashion retailers seeking to embark on the journey to sustainability.
What role do fashion retailers play in unlocking access to more sustainable, and fair fashion?
Retailers are guardians of the products that are made available to the majority of the consumers in today’s fashion market. Over decades, they have optimized a system that maximizes margins while minimizing risks. To do so, the system relies on working with a vast selection of brands and suppliers. To maximise returns, they rely on a play of repetition and optimization of what brought success in previous seasons.
It takes courage, vision and entrepreneurial skills to change course to build a better system and to integrate new sustainable brands in the offering. But with awareness rising, consumers will increasingly demand transparency and better products. As with online shopping in the beginning of the century, the retail industry is on the cusp of an undeniable shift.
Many retailers are already starting to look at their options to embed more good to avoid being outpaced by newcomers in the market. Novel multi brand market places and/or stores that have put social and environmental criteria at their core have seen an unprecedented rise in sales in the past year. To get access to the consumer market, many conscious brands have developed and improved their own B2C channels, making it less important for them to adapt to the margin requirements and other restrictions of traditional multi-brand retailers.
Retailers can influence both suppliers and consumers
Being uniquely positioned to speak to both consumers and brands, retailers have the opportunity to support change in the industry and gain from doing so. Bringing about transformation requires reassessing the importance of short-term profitability over longer term stakeholder benefits. It requires changing relationships with suppliers to become more open and collaborative. It requires openness and flexibility internally to allow employees to test novel products, services and systems (rental? repair? second life?). And for all the above, it requires the courage to go through somewhat muddy waters to forge a better path forward. But retailers that take up the challenge to bring about change now, are likely to be rewarded in the long run.
Where should priorities lie? Which KPI’s are relevant?
Success in the future is no longer limited to understanding how to make a good trade and/or predict which trends will bring the most profit or grow your market share. With stakeholders increasingly looking at the core values behind a company and its leadership, future success will increasingly be determined by the core values along which the company functions, and about enabling employees, suppliers and customers to embrace those values too. These core values should be reflected in the internal organization and policies, in the products on offer and the internal and external communication and positioning. For example:
- If diversity and inclusion are key values, can these be put to the forefront through assortment or supplier choices, by including more brands and/or manufacturers that are founded and owned by women and/or minorities? Maybe even setting goals to have x% of assortment brands coming from minority-led brands among the buyer’s KPI’s?
- If the environment is a priority, can your company’s emission reduction efforts also be reflected in the choices you make for partners and suppliers? What minimum standards will you set for your suppliers and their products? Can you go as far as putting in place environmental footprint minimum requirements or KPI’s?
- As you decide to seek more transparency and good practices from partners and suppliers, how is this reflected in the internal and external communication towards your employees and customers?
Do I need to sell only products that tick all the boxes through certifications and standards?
Certifications and standards offer relevant and useful guidelines to assess whether a brand meets the sustainable and ethical requirements defined in their company’s CSR policy. But they are not more than a seal of approval. It does not rule out that all sourcing and buying specialists in the company should be equipped with relevant material and supply chain knowledge to determine whether a brand meets the social and environmental sustainability requirements set by your organisation.
If the focus is too much on ‘ticking all the boxes’ or specific certification requirements, the brands that are actually founded on the principles of doing good, might be disqualified unnecessarily.
- Purpose driven fashion brands, that meet all social and environmental standards as part of their company DNA, sometimes don’t see the added value of investing in a stamp of approval by a third party. Or there are simply no relevant certifications for the exclusive and unique origin of their products. Taking a closer look at the company’s values and origin will reveal valuable information about the brand– and the positive impact it has on people and/or planet.
- Some smaller, fair, sustainable fashion brands and manufacturers do not apply for certifications they would qualify for, as the costs involved will make their products more expensive in a highly competitive market. If you would like to feature exclusive and limited editions in your collection portfolio, take a closer look at impact driven fashion brands that are founded on the principles of doing good.
Only those who know to ask the right questions will be able to determine whether or not a brand fits in your brand portfolio, also when they do not tick all the desired certification and standard boxes.
Retailers can play a crucial role in making the fashion industry more sustainable
In the fashion value chain, fashion retailers play a crucial role in accelerating the industry’s shift to becoming better for people and planet. And, in the transition to a circular and regenerative fashion industry, fashion retailers are uniquely positioned to engage and enable both brands and consumers to join this movement.
As gatekeepers in the fashion industry, they hold the key to supporting transparent, fair and environmentally friendly brands to develop, and ultimately, to changing norms in the industry.
In this decade of action, consumers, industry professionals and change-makers are eager to support and collaborate with those fashion businesses that take bold steps towards a more social and environmentally sustainable industry.
The choice is ours. Who wants to unlock a fairer and greener fashion industry?