Refreshed for 2022, our regular analysis selects one or more news stories from fashion technology, and presents The Interline‘s take on why they matter to our global brand and retail audience – as well as what they might mean for the longer-term future of fashion. As always, this analysis is also delivered to Interline Insiders by email – and signing up continues to be the best way to get a fresh look at the fashion technology news, completely free, in your inbox.
Sustainability labels face their first challenge, and incremental improvements are still insufficient.
It’s no secret that the fashion-buying public is seeking sustainable options – even at a point in time where their purchasing power is being eroded by inflation. But the information they use to distinguish a sustainable garment from a non-sustainable alternative is by no means standardised, audited, or reliable. Outside of rigorous outside examinations such as B Corp status, and the UK’s Modern Slavery Act, the industry has been largely left to self-regulate and self-declare. As a result, most of today’s sustainability statements are made on the basis of averaged and historical data, or limited examinations of sourcing and supply chain practices that rarely reach beyond the first tier.
The mandate from the market, though, has been changing – and changing quickly. Consumers are demanding more insights into the composition, journey, and manufacturing process of their products; regulators are increasingly scrutinising those same areas; and investors are applying stringent ESG and CSR policies to their engagement with fashion organisations.
Against that backdrop, it’s little wonder that brands who have found it difficult to gather their own supply chain information (at either the material or labour level, or across both) saw significant promise in independent sustainability certifications such as the profiles and labels offered by the Sustainable Apparel Coalition under the Higg banner. These, in theory, offer a solution, by providing an independent verification of the sustainability profile of a particular garment that’s based on the industry experience of the large brands that formed the SAC in the first instance.
The universal viability of these product-level profiles has, however, come under a new challenge, with Norway’s Consumer Authority writing that they do not constitute sufficient evidence to substantiate a claim that a garment is “sustainable”. This comes as a follow-on to a Norwegian brand making use of the labels on its eCommerce catalogue to allow customers to make the kind of informed choice referenced earlier.
This is, by anyone’s definition, a setback. The opinion of the Norwegian regulators may not be reflected elsewhere in the world, but this is an early stage challenge to a system of labelling and impact quantification that appeared to be aiming for universality.
Quite how things develop from here is uncertain, but as we have done many times before, The Interline would recommend that any brand looking to add greater confidence to its sustainability disclosures begin to gather as much of its own data as possible – at as many stages of its supply chain as it can. No doubt the fashion industry will run through one or more cycles of third party accreditation, but it’s beginning to feel increasingly likely that the eventual outcome will be full first-party transparency. A sweeping change, but a necessary one.
An entirely different example of the sort of sweeping change that might be required to the fashion value chain – this time in distribution and logistics – was also highlighted this week, with the announcement that Boundary Layer had raised additional funding for its electric hydrofoil ocean vehicles, which are designed not as a replacement for traditional sea shipping, but as a way to eliminate the cost and carbon footprint of air freight by offering a similar speed of logistics over water, with no fossil fuel consumption.
Like a lot of electric transportation and logistics concepts, this one may prove difficult to sale and commercialise. But nevertheless, it’s important to note that one of the primary contributors to fashion’s pollution profile (a business model that leads to late decision-making and mandates the use of costly and carbon-intensive air freight) is being directly challenged.
Just last week, The Interline pulled together different strands of news that suggested perhaps the long honeymoon period of high-growth, huge-volume disposable fashion was coming to an end. This week saw some further vindication of that idea, with Missguided entering administration and being saved by the Frasers Group for an incredibly lean £20 million which covered intellectual property alone. This came as a follow-up to the late 2021 acquisition of a 50% stake in Missguided, which was bought for an undisclosed sum by an investor just before Christmas.
In a lot of ways, the post-pandemic era was fast fashion’s game to lose. Despite environmental and ethical advocates’ best efforts, the twin forces of greater socialisation and reduced household income should, logically, have led to people wanting to buy more clothes, cheaper. In that context, this week’s news really does represent a significant upset to the expected order.
And this is by no means a Missguided-only problem. Shares in Boohoo – arguably the UK’s highest-profile, home-grown fast fashion brand – are trading at a five-year low. Some of which is, unquestionably, down to the overall economic slump, but it’s important to remember that a potential recession will hit discretionary industries that rely on constantly-sustained growth particularly hard.
Unlike sectors where demand is relatively inelastic (read: essentials like food, petrol, and medicine) low-cost, high-volume fashion can only be sustained when demand is being actively curated around the clock, and when that demand begins to wobble, there are few options on the table besides cutting supply and cutting costs. And for brands whose entire business models are built on wire-thin margins and a continuous influx of new product, tweaking either of those variables can have a catastrophic impact on the health of the individual company – as well as being emblematic of a broader shift in the market.
To put a capstone on this week’s news: the latest edition of the terrific Business of Fashion Sustainability Index reveals that “widespread inaction” has seen the industry’s overall sustainability score regress this year. The direct cause of this was, perhaps unsurprisingly, the unwillingness of new, fast-growth companies to engage with the sustainability metrics that matter, which eroded “incremental” progress made by those companies that were listed last year.
Whether the driver is simple commercial pressure, or a change in the direction of consumer demand, it’s clearer than ever that sustainability needs sweeping transformations that are built on objective, first-party data.
Explore intelligent planning:
Planning of all types – merchandise, assortment, financial and more – has, in the past, been oriented around one particular objective or channel, and based on analysis of historical information. Intelligent planning is the opposite: multi-dimensional, channel-agnostic, and operating in as close to real-time as possible.
That’s a vision that many retailers and direct-to-consumer brands have been aiming towards for a while, but what does a smart, predictive retail strategy look like – practically-speaking – in a world that’s constantly confounding expectations?
The Interline tackled that question this week, in partnership with Board International. Read our full collaboration to uncover the practicalities and the potential of a new model of planning.
Or sign up to Board Day 2022, taking place next Wednesday, 8th June, to hear Burberry talk about their implementation of Board’s smart retail planning platform as part of the brand’s comprehensive transformation strategy.
PLM Report 2022:
As the UK heads into an extended weekend, the PLM Report 2022 (from WhichPLM and The Interline) is making waves worldwide, with its complete picture of the product lifecycle management landscape for footwear, apparel, and accessories.
The report is free to download and available from The Interline today, with no strings attached and no requirement to provide any contact details.
Across more than 100 pages, the PLM Report 2022 contains exclusive advice, comprehensive vendor listings, and expert market analysis targeted at brands and retailers looking to make either first or second-stage investments in apparel PLM, extended-PLM, and PLM-adjacent technology. Download your copy today.
