Short essay - addressing sustainable production and consumption in fashion

A short essay from Cambridge Institute for Sustainability Leadership's course "Business Sustainability Management", working on a case study of a workwear clothing company.

 

Produce a briefing for the CEO of the company in your case study that highlights how the company could become more competitive and resilient to external risks (those associated with the systems, pressures and trends in the industry of the case study you have picked) by systematically addressing unsustainable production and consumption practices relevant to the company and its sector.

 

To remain competitive, we need to react to our commercial and sustainability challenges, and associated shifting trends in demand [1], through new business models and markets, investing for long-term reduction to our rising production costs and risk.

Using our positioning in durable clothing over “fast fashion”, through circular solutions we can create new opportunities and avoid pressure from volatile and rising input prices [2), while tapping into an opportunity to re-capture $500bn of lost value each year and mitigate systemic risks of downstream environmental impacts around unsustainable consumption [3].

The instability of our globalised supply chain is a risk. Poor working conditions are driven by prices being forced downwards by fast fashion [4] and exacerbated by our lack of transparency on operations. We risk operational shutdowns and regulatory issues and reputational issues [5]. Production intensity is high: water, chemicals, fossil fuel based energy [6], and virgin material use, raising a concern around long-term resource depletion, and thus viability.

We can mitigate this by evolving to a collaborative relationship with our suppliers, rolling out supplier standards, gaining transparency on their operations and helping them improve to build long-term resilience; as part of this initiative, collaborating to develop materials that produce garments that can be reused or recycled easily and have lower impact [7].

We immediately need to convince a number of stakeholders, and invest in our new standard, innovation for new materials, and an improved stable deal for our supply chain. We will realise payback in the long-term through higher resilience and a new product range aligning to sustainable trends (see Adidas [8]).

We risk losing a foothold with customers in existing markets and not evolving into new ones. We need to connect with younger generations who value sustainability more highly [9] and respond to negative impacts of our industry [10].

We mitigate by evolving our business models, putting the customer at the core [11].

We can offer customers repair, exchange and recycling (enabled by materials redesign [12]), refurbished garments, and physical collection points and online marketplaces as enablers. Alongside this we can move our B2B business to a subscription model.

This will take time and investment in the short-term, refocused marketing and optimised logistics [13], but we can fund through subscription cash-flow; whilst increasing utilisation and lifetime value per garment long-term, “locking-in” [14] our customers to our ecosystem [15] by providing these new forms of value.

 

To secure our future market position, we need to make short-term economic sacrifices and risks, embracing sustainable consumption as a long-term value creator. Stabilising our supply chain, developing new circular products and business models is a long-term strategic move, which will eventually lower our costs and risk, open new markets, and establish stable win-win stakeholder relationships and greater long-term value.

 

1 - Blowfield, M, 2013, “Business and Sustainability, Oxford: Oxford University Press.

2 - Ellen MacArthur Foundation, 2013, “Towards the Circular Economy”, Retreived from https://www.ellenmacarthurfoundation.org/assets/downloads/publications/TCE_Report-2013.pdf

3 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

4 - McKinsey & Company (2016), “Style that’s sustainable: A new fast fashion formula”,https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula

5 - McKinsey & Company (2016), “Style that’s sustainable: A new fast fashion formula”,https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula

6 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

7 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

8 - Edie, 2018, “Adidas sold one million pairs of ocean plastic trainers in 2017”, https://www.edie.net/news/5/Adidas-sold-one-million-pairs-of-ocean-plastic-trainers-in-2017/

9 - McKinsey & Company (2016), “Style that’s sustainable: A new fast fashion formula”,https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula

10 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

11 – Barry, Mike, 2017, CSM BSM Module 4, Unit 3 Video, Cambridge / Get Smarter, All Rights Reserved

12 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

13 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

14 – Volans, 2016, “Breakthrough Business Models: Exponentially More Social, Lean, Integrated, Circular”, Business & Sustainable Development Commission

15 - Borromeo, Leah, 2014 “A Swedish denim label wants to change the way we wear our jeans”, https://www.theguardian.com/sustainable-business/nudie-swedish-denim-label-jeans, Guardian