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A recent report by Planet Tracker urges brands to adopt comprehensive water management strategies, including setting targets, collecting data, and supporting suppliers to transition to more sustainable practices.
According to the report, the fashion industry requires over 700 gallons of water to produce a single T-shirt, while the production of cotton—a staple material in the fashion world—requires a staggering 2,100 gallons of water for every 2.2 pounds of cotton lint. Despite these figures, only a fraction of fashion companies are actively reporting their water impacts, with just 15 out of 29 companies studied disclosing their data to the Carbon Disclosure Project.
Richard Wielechowski, Senior Investment Analyst, Planet Tracker, emphasises the urgent need for the industry to recognise water as a material risk to their profits and revenues. He calls for a shift in attitude towards water stewardship, urging companies to prioritise water conservation efforts across their supply chains.
Indeed, the ramifications of water scarcity are already being felt, with cotton prices soaring by 30 per cent globally in 2022 due to water-related stress. Yet, many brands remain oblivious to the impending crisis, with water risks rarely featuring in earnings calls or capital markets events.
Amidst this backdrop, companies like H&M are taking proactive steps towards water sustainability. H&M has set ambitious water targets focusing on efficiency, discharge, withdrawals, and pollution reduction. By signing onto initiatives like the UN Global Compact CEO Water Mandate, H&M is leading the charge towards more responsible water management practices within the industry.
However, the challenges ahead are formidable. With 67 per cent of the world's cotton expected to be grown in areas of extreme water stress by 2030, the fashion industry must confront the harsh reality of its environmental footprint, emphasies the report.
A pioneering Swedish denim fashion brand established in 2023, Madh has teamed up with Italian denim manufacturer Candiani Denim to launch a new sustainable denim collection.
The collection comprises ten meticulously crafted pieces, including five-pocket jeans and a denim Western-style jacket, available in an array of colors. From classic boot cuts to contemporary flares, the collection caters to diverse style preferences, emphasising versatility and durability. Priced at €220 for jeans and €240 for the jacket, these premium offerings are retailed through Candiani Denim's flagship store in Milan and the Madh website.
The collection will be crafted using a blend of up to 26 per cent post-consumer recycled cotton (PCR) sourced from Candiani and cotton fibers cultivated from regenerative, non-GMO European cotton derived from Blue Seed—a proprietary hybrid cotton seed developed by Candiani in collaboration with Gowan Seed Company.
Undertaken by Algosur in Andalusia, the cultivation of Blue Seed cotton involves employment of regenerative agriculture techniques to ensure environmental stewardship and transparency throughout the entire supply chain. Candiani's ownership of Blue Seed facilitates meticulous traceability from cultivation to production, setting new standards for accountability in the industry.
Blue Seed's hybrid nature imbues the cotton with ‘hybrid vigor,’ endowing it with superior physical attributes such as enhanced fiber length and strength. Consequently, fabrics woven from this cotton exhibit exceptional quality, durability, and resistance—an essential characteristic for Madh's philosophy of longevity in fashion.
The local garment industry of Philippine has expressed concerns over its ability to reach the ambitious $1-billion export target this year, citing challenges posed by the stringent rules of origin (ROO) enforced by the European Union (EU).
Robert Young, President, Foreign Buyers Association of the Philippines (FOBAP) and Trustee-Textile Sector, Philippine Exporters Confederation Inc, highlights, the industry players may achieve only 80 percent of their garment and apparel exports target due to the EU's ROO enforcement.
Philippine-made wearables exported to the EU currently benefit from the Generalised Scheme of Preferences+ (GSP+), allowing duty-free entry. However, the EU's strict ROO imposes a 12 per cent duty on these exports, creating hurdles as it limits the value-added inputs sourced from non-GSP beneficiary countries like China, a major textile source. With no domestic textile manufacturing industry, the Philippines relies on imported fabric, which doesn't meet EU's ROO criteria.
Young warned of the industry's underperformance due to these restrictions and advocated for alternative solutions, such as purchasing from Free Trade Agreement (FTA) countries with bilateral agreements with the Philippines. Despite the EU accounting for only 10 per cent of the country's total export receipts for garments and textiles, Young urged the government to get garments included in the proposed bilateral free trade agreement with the EU to extend benefits to local manufacturers.
Furthermore, garment exporters advocated for the establishment of more garment factories to meet export demands, particularly from the EU. Young proposed the construction of a pilot commercial-scale textile factory, citing its potential to attract foreign investors and boost the economy, similar to the success seen in countries like Bangladesh and Vietnam.
Young emphasised on the need to produce own fabric to meet EU preferences, underscoring the importance of building a pilot factory to ensure compliance with potential ROO requirements in future bilateral trade negotiations. In 2023, the industry exported approximately $1 billion worth of soft goods and $400 million worth of hard goods, showcasing its significant contribution to the country's export sector.
In the pre-budget seminar organised by the Commerce Ministry, All Pakistan Textile Mills Association (APTMA) put forward a comprehensive plan to address the challenges hindering its growth and competitiveness. Central to this plan is the overhaul of existing power tariffs to reduce industrial costs and foster sustainability.
One key proposal involves eliminating cross subsidies and stranded costs in the current power tariff structure, which could potentially decrease the industrial tariff from 14 cents per unit to 9 cents per unit. Additionally, APTMA recommended implementation of business-to-business (B2B) electric power contracts to secure green energy at competitive rates, with an upper cap of 1,000 MW/annum to manage financial implications effectively.
Recognising the importance of transitioning to green energy, APTMA proposed increasing the cap on solar net-metering for industrial consumers from 1 MW to 5 MW. This move aligns with global sustainability trends and could bolster the country's export competitiveness, particularly in light of impending green regulations such as the EU's Carbon Border Adjustment Mechanism (C-BAM).
Highlighting challenges such as prohibitive energy costs, delays in tax refunds, and unfavorable duty structures for key raw materials, APTMA emphasised on the need to rationalise tax rates, deepening the stock market, and incentivizing exports.
Furthermore, the association called for the establishment of a dedicated entity to ensure the effective enforcement of sustainability standards, especially following the devolution of functions to the Trade Development Authority of Pakistan (TDAP).
APTMA also urged the industry to shift its focus from cotton to man-made fiber (MMF) textiles. This involves removal of import duties on raw materials such as Purified Terephthalic Acid (PTA) and Polyester Staple Fiber (PSF) to stimulate MMF production and diversify the export basket.
Additionally, the association proposed measures to remove import duties on recycled polyester and zero-rating duties on dyes and chemicals essential for downstream industries.
In the realm of machinery and equipment, the industry called for the withdrawal of customs duties on industrial spare parts and gas generators to promote sustainable energy practices and enhance international competitiveness.
Finally, the association advocated for expanding the scope of the Export Facilitation Scheme (EFS) to cover the entire value-added chain of the textile sector and revising provisions to facilitate indirect exporters in the Sales Tax Return process.
Organised amidst vibrant spring scenery, the Fall/Winter edition of Shanghai Fashion Week attracted many noted personalities from across the globe, including the esteemed Japanese designer Naoki Takizawa, alongside the iconic Chinese brand Le Fame, renowned for its contemporary Shanghai flair.
Under the overarching theme of ‘Chainborne,’ this year's Shanghai Fashion Week aimed to foster profound integration among diverse stakeholders through a bustling lineup of fashion extravaganzas, trade exhibitions, and showroom presentations.
Embracing the digital age, Shanghai Fashion Week partnered with Douyin (TikTok China) to unveil digital fashion spectacles and spotlight distinctive Chinese designers to a staggering audience, amassing up to 117 million views.
Leading the charge in this fashion marathon was Le Fame which unveiled its Fall/Winter 2024 ready-to-wear collection.
Dubbed the ‘Modern Shanghai Trilogy,’ the collection was launched in three captivating chapters: ‘Shanghai Glamour,’ ‘Shanghai Moonlight,’ and ‘Shanghai New Classical.’ Teaming up with the independent designer Zhong Zixin, Le Fame drew inspiration from the glamorous era of the 1920s intertwined with the essence of modern ‘Shanghainese womanhood. ‘
Meanwhile, amidst the whirlwind of Shanghai Fashion Week, the 2024 Fall/Winter Mode Shanghai Fashion trade show beckoned a multitude of domestic and international trailblazers. Mode played host to 11 vibrant showrooms, nearly 300 brands, and enterprises, with overseas exhibitors comprising nearly half, many boasting a rich background in the supply chain.
An esteemed luxury down jacket brand, Raxxy dazzled audiences with its innovative 3D reconstruction technology and a slew of patents for groundbreaking craftsmanship techniques. Drawing inspiration from traditional Chinese bamboo weaving, William Shen Founder, heralded a new era of fashion innovation, poised to captivate the global stage.
A brand rooted in the cashmere supply chain further enriched the tapestry of Mode by launching its latest collection in collaboration with fashion maven Siqiyoung and Douyin
Another brand, M Space delved into the realms of sustainable fashion development and innovative business models, igniting dialogues on AI intelligence, e-commerce channels, and supply chain enhancements.
Thierry Andretta, Global CEO, Mulberry, lauded the burgeoning landscape of sustainable fashion concepts in China, vowing to harness AI intelligence to propel the brand's sustainability agenda forward.
Echoing these sentiments, Wang Junhong, Executive Director and Vice President of Lilanz Group, emphasised the imperative for brands to thrive sustainably, fostering a symbiotic relationship between business success and broader societal contributions.
Hailed as a cornerstone of Shanghai Fashion Week, Ontimeshow continued to carve its legacy as the preeminent invitation-only fashion trade show in China, by attracting global fashion luminaries and catering specifically to the burgeoning Chinese market. Held under the leadership of Gu Yeli, Founder, the show highlighted the indispensable role of collaboration amidst the evolving retail landscape.
Department of Homeland Security (DHS) Secretary Alejandro Mayorkas unveiled a comprehensive textile enforcement plan, drawing commendation from the National Council of Textile Organizations (NCTO) President and CEO Kim Glas. The plan targets import fraud and circumvention of free trade agreement rules, addressing critical concerns for the U.S. textile industry.
Glas praised DHS's proactive approach, highlighting the devastating impact of customs fraud and predatory trade practices on the domestic textile supply chain. The industry has witnessed significant losses, with 14 plants closing recently. Glas emphasized the urgent need for robust enforcement to safeguard the industry's competitiveness.
NCTO's engagement with administration officials, including Secretary Mayorkas, underscored the necessity for aggressive enforcement measures. The plan responds to industry demands for heightened scrutiny under free trade agreements and enhanced penalties to deter fraudulent activities.
Key elements of the plan include intensified inspections, expanded audits, and increased scrutiny of de minimis imports. Glas stressed the importance of stakeholder awareness and urged continued collaboration between DHS and U.S. Customs and Border Protection (CBP) to ensure effective enforcement.
While the focus is on textile and apparel enforcement, Glas acknowledged the administration's broader efforts, including potential regulatory changes to address concerns regarding de minimis shipments. NCTO called for swift congressional action to pass comprehensive de minimis reform legislation.
The industry's commitment to supporting enforcement efforts and bipartisan support from Congress were highlighted as crucial components in combating predatory trade practices. NCTO expressed readiness to collaborate with DHS, emphasizing the importance of Secretary Mayorkas' upcoming keynote speech at their annual meeting.
In conclusion, DHS's textile enforcement plan represents a significant step in protecting the U.S. textile industry from unfair trade practices. NCTO's endorsement reflects industry-wide support for decisive action to uphold trade laws and ensure a level playing field for domestic manufacturers.
In an era marked by heightened environmental consciousness, the denim industry stands at the forefront of sustainable transformation. Three stalwarts spanning the denim supply chain - Archroma, G-Star Raw, and Advance Denim - have reinvigorated their collective mission to champion aniline-free denim production, leveraging Archroma's cutting-edge Denisol Pure Indigo 30.
Archroma, esteemed for its pioneering strides in sustainable chemistry, has forged enduring partnerships with G-Star Raw, an innovative Dutch denim brand, and Advance Denim, a trailblazer in sustainable denim manufacturing, since 2019. Together, they have set their sights on revolutionizing denim production, aiming to deliver premium-quality denim garments in authentic blue shades while circumventing the environmental pitfalls associated with aniline impurities.
Traditionally, the synthesis of standard synthetic indigo engenders the presence of aniline impurities, which pose a grave threat to environmental integrity. During conventional denim production, this toxic compound becomes entrenched in the fabric, only to be released into wastewater during subsequent dyeing and washing processes. With approximately two-thirds of aniline waste finding its way into water bodies, the urgency to adopt aniline-free practices cannot be overstated.
Enter Archroma's game-changing solution: Denisol Pure Indigo 30. This innovative formulation, comprising a 30 per cent pre-reduced indigo solution, heralds a paradigm shift in denim production. By seamlessly eliminating aniline impurities throughout the manufacturing process, Denisol Pure Indigo 30 not only upholds the hallmark deep indigo hues synonymous with denim but also significantly reduces water consumption and hazardous chemical usage.
Umberto De Vita, Market Segment Director for Denim at Archroma Textile Effects, underscores the transformative potential of aniline-free production in fostering environmental stewardship and circularity within the industry. G-Star Raw echoes this sentiment, underscoring its unwavering commitment to sustainability by integrating clean chemistry and durable design principles into its ethos.
In tandem with its partners, G-Star Raw aims to ensure that 20 per cent of its collection comprises Cradle to Cradle Certified fabrics by 2025. Advance Denim, having spearheaded the launch of aniline-free collections, stands as a testament to the industry's relentless pursuit of sustainability and innovation.
Together, these industry titans are at the vanguard of a sustainability revolution, propelling the denim industry towards cleaner, greener horizons. With their concerted efforts, they not only redefine industry standards but also inspire a global shift towards environmentally responsible fashion practices.
Archroma, a leading provider of specialty chemicals for sustainable solutions, unveiled its One Way+ program aimed at assisting mills and brands in adopting best practices for enhanced productivity, efficiency, and reduced environmental impact. The initiative comprises three phases: establishing a baseline, process design and implementation, and ongoing improvement, tailored for selected customers.
Anish Paliwal, Market Segment Director at Archroma Textile Effects, highlighted the mounting pressure on brands and mills to meet sustainability demands amidst challenges in water and waste management and compliance. The One Way + program offers expert support to achieve sustainability targets while improving product quality and performance.
Mills adopting Super Systems+ through One Way + can anticipate increased productivity, reduced resource usage, and cleaner chemistry, along with the development of new aesthetics. Participation signals a commitment to sustainability and compliance with regulatory standards.
For brands collaborating with Archroma under One Way +, the program offers a roadmap to sustainability targets and insights into supplier sustainability status. The goal is to optimize supply chain efficiencies and connect with sustainable suppliers.
One Way + typically spans 16 weeks, involving Archroma experts closely with customers' technical teams. Success stories include significant reductions in processing time, water, and steam usage across various mills globally.
One Way + embodies Archroma's "Planet Conscious+" vision, aiming to drive the textile industry towards sustainable processes. With a vast product portfolio and global presence, Archroma is poised to lead the industry towards a more sustainable future.
The fashion industry, known for its slow-moving behemoths, has become a surprising breeding ground for innovative startups. Forget the notion that fashion startups struggle to make a significant impact. Today's innovative companies are redefining the industry, from sustainability to personalization, with a focus on agility and technology.
Sustainability steals the spotlight
A significant portion of impactful fashion startups are tackling the industry's environmental woes. For example French company Heuritech utilize artificial intelligence to optimize fabric production, minimizing waste a major concern in the industry. Girlfriend Collective focuses on sustainable activewear made from recycled materials, resonating with eco-conscious consumers. Italic leverages data to connect consumers directly with manufacturers, cutting out markups and offering luxury goods at accessible prices. Similarly, Patagonia, a long-time leader in outdoor apparel, continues to push boundaries with its Worn Wear program, encouraging garment repair and resale. These startups address a growing concern within the fashion industry, with a McKinsey report stating that "63 per cent of fashion executives believe sustainability will be a competitive differentiator in the next five years." And as Sarah Pai, a fashion analyst at Euromonitor International point out, consumers are increasingly looking for brands that align with their values. Sustainability is no longer a niche, it's a core expectation.
Adaptability, a core character
The fashion industry thrives on trends, and successful startups need to be chameleons, they thrive on flexibility. Dopple exemplifies this by offering on-demand personalized clothing production, catering to the desire for unique pieces. However, this agility can be a double-edged sword. As Sarah Jones, founder of fashion consultancy firm StyleWorks, cautions, "The challenge is predicting trends and consumer behavior accurately enough to invest in the right areas without becoming obsolete too quickly.” This agility allows startups to experiment and iterate rapidly, a stark contrast to the traditional multi-season design cycles. Brands like Reformation, known for their trendy, sustainable pieces, leverage data analytics to quickly identify and respond to shifting consumer preferences "We're constantly iterating and evolving," says Reformation CEO Yael Aflalo. "The ability to be nimble and data-driven is critical to staying ahead of the curve."
Opportunities abound
Despite the potential, fashion startups face hurdles. Venture capitalist Michael Brooks of Forerunner VC highlights the challenge of competing with established brands, "Large fashion houses have the resources to quickly adapt and replicate innovative concepts." Competition is fierce, with established brands acquiring promising newcomers like Depop by Etsy. Additionally, securing funding can be challenging, especially for those prioritizing ethical production over mass-market appeal.
However, Brooks also sees opportunities, "The rise of social media and e-commerce platforms like Shopify has democratized access to consumers, allowing startups to build loyal followings without relying on traditional retail channels."
The growing awareness of sustainability is a boon for eco-conscious startups like Girlfriend Collective, which uses recycled materials to create high-performance activewear. Similarly, the rise of personalized experiences opens doors for companies like Lookiero, an online personal shopping service that uses data to curate styles for individual clients.
Beyond the fashion capitals
The industry is no longer geographically concentrated. While New York, Paris, and Milan remain fashion hubs, innovation is flourishing around the globe. "Thriving ecosystems" exist beyond traditional fashion capitals, says a report by F6S with a concentration in India where companies like Aaiena are utilizing technology to personalize the shopping experience. TheRealReal, a luxury consignment platform, is thriving in San Francisco, while ThredUp, a leading online thrift store, has its headquarters in Chicago. While the US and Europe remain dominant, this global landscape creates opportunities for startups to cater to specific regional needs and aesthetics. "There's a democratization of fashion happening," says investor Michael Smith of Sequoia Capital. "Great ideas can come from anywhere, and the barriers to entry are lower than ever before."
The narrative surrounding fashion startups is one of transformation, not struggle. By addressing sustainability, embracing adaptability, and capitalizing on technological advancements, these young companies are not just making a significant impact, they're rewriting the very definition of fashion. The future of fashion is bright, and it's being shaped by the innovative spirit of startups around the world.
The global garment industry is facing a potential paradigm shift driven by stricter regulations on sourcing and production. Export markets like the European Union (EU) are increasingly favoring garments where countries source their own textiles internally, driven by compliance with stricter Rules of Origin (ROO) regulations. ROO stipulate the geographic origin of a product for preferential trade treatment. These regulations determine the nationality of a product for customs purposes and preferential trade agreements. Countries that comply with these ROOs gain easier access to the EU market with lower tariffs or duty-free imports.
ROO challenge, sourcing domestically
ROOs are a complex set of regulations established by trade blocs like the EU to determine the origin of a product. They play a crucial role in granting preferential trade benefits like lower tariffs or duty-free access. Traditionally, garments could qualify for these benefits even if the fabric was sourced from one country and assembled in another. However, stricter ROO requirements are demanding a higher degree of vertical integration within a country's textile and garment industry.
A key aspect of EU's ROO for garments is that a certain percentage of the textile content needs to be sourced from within the EU or a country with a Free Trade Agreement (FTA) with the EU. This is challenge for garment manufacturers who traditionally source textiles from the most cost-effective locations, often outside the EU. As Agatha Burton, trade policy analyst at the Brussels Institute for Global Governance explains, the EU's ROO compliance is becoming increasingly stringent. This incentivizes garment producers to source their textiles from within the bloc or from countries with preferential trade agreements, creating a potential advantage for domestic textile industries.
Similar regulations elsewhere
While the EU's ROO is a prominent example, other regions are adopting similar regulations. The North American Free Trade Agreement (NAFTA), now replaced by the United States-Mexico-Canada Agreement (c), has ROOs that require a certain percentage of content to be sourced from within the agreement. Additionally, countries like China are implementing stricter regulations on product traceability, which can indirectly impact sourcing decisions. The Association of Southeast Asian Nations (ASEAN) Free Trade Area (AFTA) also implements ROO requirements for preferential tariffs within the region. These regulations incentivize regional sourcing within trade blocs, impacting garment production beyond Europe.
The FTA advantage
Countries with a strong domestic textile industry and an FTA with the EU stand to benefit from the ROO regulations. Turkey, for instance, has a well-established textile industry and a deep and comprehensive FTA with the EU. This allows Turkish garment manufacturers to comply with ROOs more easily and potentially gain a competitive edge in the European market. "Our FTA with the EU simplifies compliance and reduces costs," says Mehmet Kaya, President, Turkish Textile and Apparel Manufacturers Association. This allows us to compete effectively with producers who may struggle to meet the ROO requirements.
In fact, with the EU's stricter stance, countries with well-developed textile industries stand to gain an advantage. According to a 2022 report by the European Commission, Italy, France, and Germany – all with robust textile sectors – are major EU garment exporters. Countries with existing FTAs with the EU already enjoy preferential tariffs, making them more competitive. Vietnam, for instance, boasts of a booming garment industry and a 2020 Free Trade Agreement with the EU. This agreement offers Vietnamese garment manufacturers a significant advantage when complying with ROO regulations.
Countries with existing FTAs with the EU
Several countries with established textile industries already have FTAs with the EU
• Turkey
• Morocco
• Tunisia
• South Korea
• Vietnam (partially ratified)
Impact on sourcing
The impact of ROOs on garment sourcing is likely to be a gradual shift rather than a sudden change. The emphasis on internal textile sourcing could indeed be a paradigm shift. Traditionally, garment manufacturing relied heavily on geographically separated production stages. Countries like Bangladesh, known for low-cost labor, often sourced textiles from elsewhere before assembling garments for export. The new focus on ROO compliance might force a more vertically integrated approach, with countries building or expanding their domestic textile industries.
In the short to mid-term, one may see increased focus on sourcing textiles from FTA partner countries, so countries like Turkey and Vietnam, benefit the most; more investment in domestic textile production capacity within the EU; potential price increases for garments due to higher sourcing costs; a shift towards sourcing textiles from countries within the same trade bloc to comply with ROO regulations.
In the long-term, the impact could be more significant with a more regionalized garment production model and production closer to consumer markets. Increased emphasis on transparency and traceability throughout the supply chain. More potential for innovation in sustainable textile production within the EU. Also, in the long run, the stricter regulations could incentivize countries with lower-cost labour to invest in developing their domestic textile industries. This could lead to a more geographically dispersed yet vertically integrated garment production landscape.
The EU's ROOs are prompting a strategic shift in garment sourcing. While the short-term effects may be price adjustments and regional sourcing strategies, the long-term implications could be a more sustainable and transparent global garment industry. Countries with strong domestic textile industries and existing FTAs with the EU are well-positioned to capitalize on this trend. As regulations evolve, the global garment industry will likely adapt to a more geographically concentrated and compliance-driven production model.
