Our rundown of the key trends and issues in global apparel and textile industries in 2018…
Feeling the heat
The fashion industry is finally acting on climate issues. One of the biggest stories this year broke just recently when representatives from brands and retailers made concrete commitments to address climate change by launching the Fashion Industry Charter for Climate Action at the Climate Change Conference (COP24). While individual brands have been attempting to do their bit on such issues for some time, the signing of this charter by many of the world’s top retailers felt symbolic. Let’s hope it leads to meaningful, concrete actions.
More than ever this year, the investment community has made its voice heard in textile and apparel circles. We’ve had investment funds calling for living wages in supply chains, urging brands to tackle slavery and people trafficking, and encouraging the continuation of the Bangladesh Accord. The penny is dropping for brands here, with smart leaders recognising that in the coming years we will witness – by necessity – a huge capital flight to sustainable businesses which adhere to high environmental and CSR standards in their supply chains. This must be a good thing.
Forgive us for sounding like a broken record on this issue, but clothing is still too cheap. We recently talked – off the record – to several Bangladeshi garment factories, all of which told us brands will not pay the extra cents required for sustainable production. Numerous other independent reports on this issue suggest brands continue to hammer suppliers on price – despite words and platitudes to the contrary. We can’t place all the blame on brands as they are locked in their own high street price war. An open and honest conversation is needed in broader society about the price of clothing. Which leads us to …
A welcome debate
It might not be much but the Sustainability of the Fashion Industry inquiry by the UK’s Parliamentary Environmental Audit Committee is a start. The enquiry is looking at the impact of fashion brands, addressing such topics as fast fashion, supply chains and pollution issues. The enquiry has got people talking here in the UK and, for all its faults, our Parliament does tend to be quite good – and thorough – with such enquiries. It might not lead to direct change, but it has certainly put issues such as how brands sell dresses for £5 into the mainstream. This has to be a positive.
Not so pretty
Actually, how do brands sell £5 dresses? The answer, as the boss of ultra-fast fashion brand Boohoo told MPs, is that it sells tens of thousands of such garments as loss leaders, to drive website traffic. We will pull no punches here: we are uncomfortable with the rise of ultra-fast fashion brands which, as well as Boohoo, also include the likes of PrettyLittleThing and Nasty Gal. All operate under the same umbrella and all are undercutting the likes of H&M, getting catwalk designs onto the high street within a few weeks by near-shoring production. We have approached all several times this year to ask about the issue of fast fashion and their work on sustainability issues. In return we have either been stonewalled or received the dreaded ‘no comment.’ Readers can draw their own conclusions.
The lack of transparency highlighted above is actually in stark contrast to another major theme of 2018, namely the continued shift towards transparency by brands. We continue to see brands publish lists of their suppliers – mainly tier one but also tier two and beyond in some cases. We also saw the production of a major survey by Fashion Revolution which found that the vast majority of thousands of consumers interviewed want to see more transparency from brands. There is increasingly no hiding place for fashion retailers in the online, social media age – and why should there need to be?
Up in smoke
The powerful impact of transparency was illustrated in summer, when it was revealed that Burberry had incinerated tens of millions of pounds worth of stock, essentially for commercial reasons. The furore over the issue led to the company stating that it would now discontinue its policy of stock incineration. It is unfair to pick on Burberry here – this is a widespread industry issue, the real dark side of which lies further down supply chains (in garment manufacturing factories). What happens when a brand orders too much stock and a supplier is left with a mountain full of unsold product? Several sources tell us landfill remains the destination of choice in such a scenario, which seems criminal in every sense of the word.
Of course, there is another way such stock could be used. Closing the loop was major theme in 2018, as it has been for several years. In summer it was reported that 94 retailers have now joined the Global Fashion Agenda’s 2020 Circular Fashion System Commitment, setting targets for circularity in fashion and textiles. With advancements in textile recycling technology now achieving commercialisation, full textile-to-textile recycling solutions could be mainstreamed in several years – if the financial backing and market appetite is there. These are both big ifs though. Expect evolution not revolution in the textile recycling space.
Down and out
The use of animal fibres has been a huge talking point in 2018. This year, a large swathe of the fashion industry has ditched mohair following a Peta report of animal cruelty on goat farms in South Africa. The whole mohair industry is now in danger of dying out, which we believe is a crying shame. Mohair is not the only issue in Peta’s sights. The animal rights groups is also targeting wool and down with similar under cover reports. We would suggest the former is at greatest threat given the number of new, down-free insulation options entering the market at the present time. One to watch, for sure.
Peta picks on wool
… wool, on the other hand, faces its own challenges. As well as having Peta on its case, there is also the small matter of one of the most serious droughts in living memory in Australia this year which has ultimately led to a major decline in wool output. With Australia responsible for the majority of the world’s fine wool exports, expect to see price rises for merino wool jumpers in the coming 18 months. Was this drought caused by climate change? The jury is still out, although the increasing frequency of such droughts – which are also now hitting cotton output in some countries – does offer clear, first hand evidence of how vulnerable the fashion industry potentially is to climate change.
Fur’s days numbered
Staying on the issue of animal-derived fibres, we have also seen a number of brands pledging to ditch fur this year, while Los Angeles and San Francisco have both banned the sale of fur products. Let us hope other states follow suit. The end of the barbaric fur for fashion trade cannot come soon enough…
Lack of Accord
… unlike the end of the Bangladesh Accord which, as we write this, looks to be coming all too soon. The story of the Bangladesh Accord and its exiting of Bangladesh has run and run in 2018, so we will try to summarise this as briefly as possible. The Bangladesh government wants the Accord to leave as it claims its own internal body can complete factory safety upgrades. The Accord, as well as associated brands and international agencies, think the Accord should remain as safety work on factories is not yet complete. The Bangladesh government has got this one badly wrong, and risks causing huge problems for what is by far its most important sector – garment production. All involved should call its bluff, while major brands should threaten to shift production elsewhere unless it does a complete U-turn.
Sailing close to the wind
Bangladesh is not the only garment exporting country which has been shooting itself in the foot this year. Both Myanmar and Cambodia have been warned repeatedly over human and labour rights issues by the European Union, with the inference being they will face losing trade sweeteners to EU markets if they don’t get their respective houses in order on such issues. Cambodia, in particular, is supping in the last chance saloon here, and if it does lose tariff-free access to the EU market in the coming months, spare thought for the many garment workers who will likely lose their jobs as factories lose European orders. The phrase ‘lions led by donkeys’ was never more apt.
The blame game
Back to Bangladesh. One of the main reasons the Bangladesh Accord came about was the Rana Plaza building tragedy. That complex was actually audited before it collapsed, killing more than 1,100 people in 2012. Similarly, in Pakistan, over 150 people died when a garment factory set ablaze that same year. Again, the building had been audited prior to the disaster. During 2018, two cases are going through the German and Canadian courts respectively in relation to buyers from suppliers operating in these buildings. The cases raise serious issues about the whole factory auditing process and associated accountability. This area is in badly need of reform, and the first tentative steps of this process may start to happen in 2019 depending on the respective outcomes of these court cases.
And finally …
2018 has been a fascinating year in textiles and apparel. Against the backdrop of the interesting issues highlighted, the ongoing trade war between China and the US – which has rumbled on and on …. and on – actually started to become somewhat tiresome. Donald Trump seems intent on flexing his muscles with China, and textile flows globally will undoubtedly be impacted if the battle between these two economic superpowers continues unabated. As our previous commentary suggests, however, sustainability issues trump (if you will) all right now, and the US’s daft protectionist stance on textiles increasingly smacks of rearranging the deckchairs on the Titanic …