{"id":11212,"date":"2024-07-17T14:58:59","date_gmt":"2024-07-17T12:58:59","guid":{"rendered":"https:\/\/escp.eu\/thechoice\/?p=11212"},"modified":"2024-07-17T16:34:22","modified_gmt":"2024-07-17T14:34:22","slug":"on-demand-fashion-gives-much-needed-clues-on-how-to-green-notoriously-wasteful-industry","status":"publish","type":"post","link":"https:\/\/escp.eu\/thechoice\/tomorrow-choices\/on-demand-fashion-gives-much-needed-clues-on-how-to-green-notoriously-wasteful-industry\/","title":{"rendered":"On-demand\u00a0fashion gives\u00a0much-needed\u00a0clues on how to green notoriously wasteful\u00a0industry"},"content":{"rendered":"\n

The fashion sector is in crisis. It\u2019s hard to get through a month without hearing about another fashion company issuing profit warnings \u2013 even Swedish-owned H&M, for a long time seen as the industry\u2019s success model, is hurting. In January, it lost\u00a012% in market value<\/a>\u00a0and abruptly changed CEO. The firm has been struggling with weak sales and stockpiling for years, mostly as a result of inefficient supply chains.<\/p>\n\n\n\n

Crisis talks and bankruptcy are also rocking other high-street favourites, from Victoria\u2019s Secret, which has closed more than\u00a0100 stores over the past years<\/a>, to\u00a0Superdry<\/a>, Gap, TopShop,\u00a0Kooka\u00ef<\/a>\u00a0and\u00a0Scotch & Soda<\/a>.<\/p>\n\n\n\n

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In contrast to the traditional mass-production model, where goods are manufactured on the basis of forecasted demand, on-demand manufacturing only makes goods when there is actual demand for them<\/strong>.<\/p>\n<\/blockquote>\n\n\n\n

Anything but green<\/h2>\n\n\n\n

Worse, the sector is unsustainable. Accounting for an estimated\u00a010% of global greenhouse gas emissions<\/a>, the global trade and production of textiles contributes more to climate change than all international flights (2%<\/a>) and maritime shipping (also 2%<\/a>) combined. The industry is notoriously wasteful, leaving 92\u00a0 million tonnes of waste in its wake annually, according to\u00a0a 2022 study<\/a>. It is estimated that more than a half of fast fashion items are thrown away within a year of purchase.<\/strong><\/p>\n\n\n\n

Then there is the question of its working conditions. Eleven years after the\u00a0Rana Plaza collapse<\/a>, workers are still struggling to survive on extremely low pay, while working excessive hours in factories that often violate their human rights.<\/p>\n\n\n\n

The big culprit for the sector\u2019s woes? Many big fashion brands have effectively developed on what we call the principle of made-to-stock: the company produces large number of goods to send them across the distribution network, which spans warehouses, logistic centres and physical stores. In most cases, companies rely on outsourced and distant manufacturing plants. As a result, when demand falls, inventories balloon \u2013 and so does waste.<\/strong> In 2017, H&M was accused of having burned 12 tons of clothing a year since 2013. In 2018, Burberry\u2019s annual report stated that it had destroyed products with a total value of \u20ac31\u00a0million in a single year.<\/p>\n\n\n\n

The promises of on-demand fashion<\/h2>\n\n\n\n

So is the fashion world doomed to waste and overproduction? In the recent\u00a0Plug and Play conference<\/a>, I argued that this wasn\u2019t a fatality, and highlighted on-demand manufacturing as a promising new path for the sector. In contrast to the traditional mass-production model, where goods are manufactured on the basis of forecasted demand, on-demand manufacturing only makes goods when there is actual demand for them.<\/strong><\/p>\n\n\n\n

This means that the T-shirt you spotted online will only be made when order it. Proponents believe supply chains ought to be redesigned to be tighter and more agile, with an eye toward factories that are physically closer and production runs that make smaller batches.<\/p>\n\n\n\n

Fashion experiments<\/h2>\n\n\n\n

A number of brands have dabbled with the idea. Following in the steps of electronics and automotive industries, Nike and Adidas have taken a run at on-demand production. In 2000, Adidas launched its online customisable platform,\u00a0miAdidas<\/a>, which allowed customers to personalise the colour, outsoles and laces of its best-selling sneakers. But in 2021, the service was mysteriously brought to a halt. Adidas framed the move as a\u00a0\u201cstrategic decision\u201d<\/a>, stating that it believed the \u201cfuture of customisation lies in co-creation\u201d.<\/p>\n\n\n\n

In August\u00a02019, Nike also selected 28 creatives and activists in New York City to design the\u00a0\u201cNYC by You\u201d project<\/a>. This made-to-order footwear collection was available until September, with the brand announcing its intention to offer sneakers\u00a0\u201conly made available for a limited time, rather than limited quantities\u201d<\/a>. Other brands such as Shoes of Prey, NA or Tekyn based their whole business model on on-demand production.<\/p>\n\n\n\n

But by and large, these early experiments showed that customers were\u00a0not ready to pay more and wait longer<\/a>\u00a0to have their unique own design.<\/strong><\/p>\n\n\n\n

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We must reconnect with the original meaning of fashion (from the French \u201cfa\u00e7on\u201d and the Latin \u201cfacere\u201d), where value is based more on the way the product is made and its quality than on the rapid renewal of trends that lead to pre-conceived obsolescence<\/strong>.<\/p>\n<\/blockquote>\n\n\n\n

Something other than textbook success<\/h2>\n\n\n\n

That said, some brands have defied the odds to prove on-demand models can be profitable. Among them are the Barcelona-based sustainable producer Alohas, or the French fashion brand Asphalte. Their success relies on small batches manufactured closer to the final consumer (for example, in Portugal for European customers) at the\u00a0right price<\/a>. Alohas is adjusting price to reduce inventory and provide an advantage to its early buyers, turning the concept of traditional end-of-season discounts on its head. Asphalte is collecting\u00a0early feedback<\/a>\u00a0from its customers to help shape future designs.<\/p>\n\n\n\n

So why are these innovators succeeding where Adidas and others closed their customisable outlets? The fact is that Alohas and Asphalte are not implementing customisation or truly starting manufacturing only when consumers finally place an order. Like the computer manufacturer Dell a\u00a0few decades ago<\/a>\u00a0or the automotive industry, they have approached on-demand through the angle of small batches, rather than single-unit production<\/strong>.<\/p>\n\n\n\n

This makes sense: after all, supply chains and manufacturing processes are designed for batches and cannot handle single-unit production profitably at scale. Existing infrastructure mostly relies on emerging economies, which hinders the opportunity for massive transformation. Also, consumers are not ready for the long waiting times and higher prices associated with a radical shift toward customisation.<\/p>\n\n\n\n

Making on-demand work<\/h2>\n\n\n\n

To make on-demand production more widespread, we need to support initiatives impacting both the supply side and the demand side<\/strong>. On the supply side, several start-ups are in the process of reshuffling the fundamentals of fashion production with disruptive models. Some of them presented interesting innovations during Plug and Play\u2019s webinar:<\/p>\n\n\n\n