Are You Ready for a More Sustainable World Post-Covid? July2021

Are You Ready for a More Sustainable World Post-Covid?


The Rise of Sustainability

The year 2020 was an unfortunate and unforeseeable eye-opener for the global fashion industry. With fashion weeks canceled, stores closed, workers furloughed, and unsold inventory mounting, fashion industry took a huge blow to the face. The fashion needs of the consumers took a backseat and were deferred in an anticipation of a better 2021. However, the second wave of the virus in early 2021 has further set back these anticipations to late 2021, with the hope that there won’t be another wave. Many scientists and green movement ambassadors have argued that fashion industry is among the most unsustainable industries. While the concept of sustainability is not new to the industry, what started just as a ‘conscious approach to capitalism’, sustainability has taken a front seat in the apparel industry. Also, the recent developments have made it more relevant than ever. In this article we discuss how sustainability in fashion industry is going to be a key driving force in the post-Covid world and how manufacturers can align themselves accordingly.

Consumer opinion

While the year sent the entire industry into a frenzy, consumers across the world have become even more engaged in sustainability and what it stands for. A Mckinsey consumer survey conducted mid-pandemic provided some really interesting insights into European consumer sentiments amid the pandemic. The survey revealed that 57 percent of the respondents have made significant changes to their lifestyles to lessen their environmental impact, and more than 60 percent report going out of their way to recycle and purchase products in environmentally friendly packaging. This sudden push towards sustainability should not come as a surprise, the latter half of the last decade saw brands pushing the idea of sustainability. Even though this push was intended to provide them marketing traction, the consumers were well-imprinted with this idea.

Deadstock

Another factor going for sustainability post-Covid is the fact that the brands will be in a way compelled to source more sustainably. This might not make sense straightaway, however, stay with me. The fashion industry prior to Covid was moving at a rapid pace. Goods manufactured in a small factory in Vietnam were on shelves of a New York downtown store within a month. The entire industry worked like clockwork to deliver the fashion faster, cheaper, and more exclusive. The planning and logistic operations of a few of the leading brands were a topic worthy of being featured in research papers. Amid all this, enters Covid-19 and something just snapped. The entire model of producing huge volumes of clothes and selling them in the shortest amount of time began felt handicapped. Brands were left with a huge deadstock.

Prior to Covid, it was a usual practice for the brands to over-order their merchandise and sell half of it at full price, while saving the rest half to be sold at a discounted price at their end-of-season sales. The entire practice of ordering higher volumes was beneficial for the brands since the cost of doubling the order size does not actually double the order value. Moreover, the end-of-season sales have traditionally acted as an organic filter for clearance of slower moving stock. The current pandemic situation has left brands with a huge dead stock that they are unable to move quickly and a huge issue of how to align their sourcing to the new normal. This has pushed the brands to source their products in a more ethical and sustainable way.

Consumer Goodwill

In order to attract consumer goodwill various brands have specifically made changes to how they will operate post-Covid. As mentioned by BCG in their recent fashion sustainability report, 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,” especially in product categories like fashion and beauty that are considered close to the body. The notion that the earth is fighting back in the form of Covid has worked phenomenally well for the brands in their marketing campaign and has cognitively made consumers more aware of the cost to the environment. Moreover, over the last year, brands have witnessed a high engagement to the social media posts that touch upon environmental sustainability as a concern. Brands are expected to continue working in this direction to attract these higher number of eyeballs and (now with wide acceptance of e-commerce shopping in developing countries) more importantly the additional thumbs.

Next steps for the industry

It has been well established now that there is a massive demand on the horizon for sustainably sourced fashion. However, there is a huge chance that this demand may not be able to meet a suitable supply. Closed doors, canceled orders, missed seasons, changes in consumer preferences have led to massive job losses and disruptions in the raw material supply chain. These factors have driven the cost of manufacturing higher which makes sustainable manufacturing and sourcing challenging. Moreover, the world’s trusted low-cost supplier i.e. China now faces the possibility of losing its preferred tag. Brands are looking to move away from China, which may further lead to disruptions in supply chains which were moving towards sustainable manufacturing.

As discussed by Varun Vaid, our Business Director recently in the January edition of Fibre2Fashion, the current situation offers a great chance for China’s neighbors India, Vietnam, and Bangladesh to capitalize on this opportunity of becoming economically and environmentally sustainable alternatives to China. However, a lot is needed for India to pose as such an alternative, it would come as a surprise to most but becoming sustainable may not be as expensive or burdensome as it used to be.

Simple steps for improving your sustainability

While it is imperative that in order to be sustainable, hiring a garment factory consultant is fundamental. However, here are are few steps that can be considered prior to engaging a garment factory consultant.

1. Procuring Certified Sustainable Raw Materials:

The first and the easiest step in the direction of achieving sustainability is procuring and using sustainably sourced raw materials. How important are ethically sourced raw materials? Traceability right from the origin of supply chain is a much-appreciated aspect of sustainable manufacturing. Brands and end-consumers take pride in ethically sourced materials. Recently, cotton originating from the Chinese Xinjiang region was banned by multiple brands such as H&M, Nike, Burberry, Adidas and many others for being linked to forced labour. A similar shadow ban was put on Uzbek cotton for not being sufficiently ethically sourced.

A few examples of sustainable cotton fibres would be Better Cotton Initiative (BCI) Cotton, Cotton Africa, Fair Trade Cotton, myBMP Cotton, among dozens of other organic and socially-aware cotton categories available. These cotton varieties are certified to be ethically sourced keeping both environment and people in mind. Even on the polyester side, there are various recycled polyester standards available such as Global Recycled Standard (GRS), Recycled Claim Standard (RCS). There are several sustainable alternatives for silk, wool, cashmere and other raw materials. Using these raw materials might add a percentage to your sourcing spending but use of these materials is paramount while dealing with brands that target sustainability. The use of these materials can easily make a garment manufacturer attractive to global buyers.

2. Acquiring Sustainability Certifications and Standards:

Before embarking on a journey towards achieving desired sustainability goals, a manufacturer should adopt the right standards for it to benchmark its progress. This standard must be true representation of all the pressing environmental, economical & social issues. There are multiple such sustainability standards which target various concerns.

Figure 1: Popular Sustainability and Raw Material Standards
Popular Sustainability and Raw Material Standards
Most of these certifications and standards are also affiliated with brands, which means if you get a certain certification, you automatically become eligible supplier to the buyers who approve of that certification. Choosing the right certification could help your factory becoming more sustainable while being eligible for more orders.

3. Setting Science Based Targets:

The United Nations Global Compact (UNGC), Carbon Disclosure Project (CDP), World Resources Institute (WRI), and the World-Wide Fund for Nature (WWF) partnered together for the development of Science-Based Target Initiative (SBTi), an initiative that suggests companies how quickly they need to reduce their greenhouse gas (GHG) emissions to be in line with the global efforts to prevent climate change. The initiative aims to halve the GHG emissions by the year 2030 with a broader target of dropping these emissions to net-zero by 2050.

The world has a limited carbon emission budget at which the global temperature rise can be capped at a manageable 2°C. Science-Based Targets acknowledge this budget and assist industries in managing their emissions through controlled allocation. These targets include a wide variety of ecological commitments to decarbonization right from raw material production to product retail stage and even touches upon the organizational carbon management. The companies are required to choose the level of intensity to which the company wishes to support the initiative. All companies are required to set scope 1 and 2 targets consistent with a well below 2° C pathway at a minimum. Companies are encouraged to aim higher and align with 1.5° C for maximum effect. Scope 3 emissions mostly comprise all indirect emissions that occur in the value chain, including both upstream and downstream emissions. Thus, scope 3 targets require companies to control these emissions.

Figure 2: Overview of Scopes and Emissions across Textile Value Chain
Overview of Scopes and Emissions across Textile Value Chain
Source: WRI
Apart from the apparent benefit of reduction in the overall carbon footprint, SBTs have other auxiliary benefits as well. These include catalyzed process innovation; cost advantage & increased competitiveness; create a brand reputation, among many. As of May 2021, more than 60 T&A companies across the world have committed to the cause. Almost half of these companies have already set their targets. These companies include some world-renowned names including, H&M, Levi’s Strauss & Co. (LSC), Louis Vuitton, Under Armour, and Marks & Spencer, to name a few. These brands have set the tone for the apparel industry to take a step toward becoming more sustainable. Manufacturers can easily set their Science Based Targets making them sustainable as well as more advertisable at the same time.

Conclusion

While the list of simple steps for becoming sustainable might end here, there are a lot of other ways of becoming more sustainable which do require some external support. These simple steps would definitely help your factory in becoming more sustainable, in order to be a leader in this space the support from a garment factory consultant is unequaled. A consultant would further assist you in optimizing your processes and systems while also supporting you in identifying the best mix of resources needed to reduce wastages and emissions.

Wastra, an initiative by Wazir Advisors helps clients establish engineered factory that are highly sustainable and also helps in re-engineering the existing factories to bring it closer to an engineered one. We believe in establishing a set-up with ideal resources, trained manpower, optimum technology, ideal infrastructure and rationally designed processes. The attractivity gap between a sustainable factory and a non-sustainable one will grow wider more than ever. Given the upcoming demand for sustainable suppliers, an engineered factory could make the difference for you. Reach out to us at wastra@wazir.in and start planning for tomorrow, today.

This article has been authored by Priyam Pandit, Consultant. The article was published in the July edition of Fibre2fashion magazine.