Fast fashion is the practice of rapidly translating high fashion design trends into low-priced garments and accessories by mass-market retailers at low costs. There are a number of elements that are key to the fast fashion process, namely: the price of the garments and accessories; the method and timeline of manufacturing; the trend-based nature and disposability of the clothes themselves.
The fast fashion model has developed from a product-driven concept based on a manufacturing model referred to as “quick response,” developed in the U.S. in the 1980s. This moved to a market-based model of “fast fashion” in the late 1990s and the early part of the 21st century. (Wiley). It has since come to occupy a very profitable position in the market.
The fashion apparel industry has significantly evolved, particularly over the past several decades. The evolution of manufacturing and consumption has resulted in the intake of “400 percent more clothing today than we did 30 years ago. That shift from mid-market to fast fashion has also tracked a shift from domestic production to cheaper overseas locations from Hong Kong, to mainland China and now to even lower cost centers including Vietnam and Bangladesh.” (CNBC).
“The changing dynamics of the fashion industry have forced retailers to desire low cost and flexibility in design, quality, and speed to market, key strategies to maintain a profitable position in the increasingly demanding market.” (ResearchGate). Fast fashion retailers both meet and fuel this demand by marketing “apparel that may not be made with the finest quality materials to last a life-time, but that is cooler and far more affordable.” (CNN).
Elements of Fast Fashion
i. Price: The widespread availability of low-cost garments and apparel is a distinguishing factor for fast fashion retailers. “The fast fashion business model is based on reducing the time cycles from production to consumption such that consumers engage in more cycles in any time period.” Spain-based Zara, the world’s largest fast fashion retailer, has prices similar to those of the Gap: coats for $200, sweaters for $70, T-shirts for $30, and denim for $69. This is markedly more expensive than H&M, the Swedish-based company, which offers most coats for $69 (though some go for as low as $29), sweaters for between $29 and $34, t-shirts for $5.99, and denim for $19.99. Forever 21, the Los Angeles-based brand, is priced comparatively to H&M. It’s new concept store, Forever 21 Red, however, offers even lower prices, such as camisoles starting at $1.80, jeans at $7.80, tees at $3.80, and leggings at $5.80.
Irish retailer Primark offers some of the lowest prices in the industry. Its first U.S. store features a selection of jeans for $7, t-shirts for $3.50 and tank tops for a mere $1.60, prices that are lower than all of its fast-fashion rivals, analysts say. The retailer boasts prices that are 40% less than H&M’s and 75% less than Gap Factory stores’, according to analysts at Goldman Sachs.
Costs are largely reduced by taking advantage of lower prices in markets in developing countries. “In 2004 developing countries accounted for nearly 75 percent of all clothing exports and the removal of several import quotas has allowed companies to take advantage of the even lower cost of resources.” (Bruce, Margaret, and Lucy Daly. “Buyer behavior for fast fashion.” Journal of Fashion Marketing and Management). Workers in Bangladesh, where 80 percent of the country’s exports are apparel, currently earn the lowest minimum wage in the world, taking home about $43 a month. Chinese factory workers make slightly more: $117 to $147 a month. In contrast, American garment workers earn about $9 an hour, taking home $1,660 a month. (http://bust.com).
ii. Manufacturing Timeline and Availability: A significant point of differentiation between fast fashion retailers and non-fast fashion brands is the rapid rate of manufacturing. “The fast fashion business model is based on reducing the time cycles from production to consumption such that consumers engage in more cycles in any time period.” (Hines, Tony. 2001. “Globalization: An introduction to fashion markets and fashion marketing.”)
While the fashion industry largely operates on a seasonal calendar, fast fashion retailers deliver new garments and accessories to their stores every four to six weeks, sometimes even more frequently. Inditex brand stores (including Zara), for instance, receive deliveries of new clothes twice a week. This is significantly quicker than Salvatore Ferragamo, for example, which has centralized inventory and established computer links to suppliers , cutting the design-to-delivery cycle by 20 percent, to 10 weeks – making it one of the most speed-forward houses in the upper echelon of fashion.
The rapid speeds of delivery for which fast fashion retailer are known are largely based on the location of their manufacturers. For Zara and other similarly situated brands, “The trendiest items are made closest to home, however, so that the production process, from start to finish, takes only two to three weeks.” (NY Times). While manufacturing in local markets – such as Spain for Zara or Los Angeles for Forever 21 – may be more costly than more far-flung locations, such Bangladesh or Cambodia (which offer significantly cheaper labor), these higher labor costs are offset by greater flexibility. Items are produced in lower quantities and so, no extra inventory is left lying around and subsequently offered up at sale prices.
In addition to the widespread availability of fast fashion garments due to the brands’ rapid manufacturing turnaround times, their garments and accessories are physically widely available due to volume of goods produced and the companies’ penetration of the market both by way of e-commerce stores and brick and mortar locations. In 2012, Inditex, for instance, was making “840 million garments a year with around 5,900 stores in 85 countries, though that number is always changing – Inditex has in recent years opened more than a store a day, or about 500 stores a year. Right now there are around 4,400 stores in Europe, and almost 2,000 in Spain alone.” (NY Times, 2012).
Forever 21 “operates over 600 stores throughout the U.S. and in Canada, Europe, Japan, Korea, and the Philippines.” (Forbes). “H&M manufactures at least 600 million items each year and operates more than 3,200 stores in 55 countries. If you include its subsidiary brands, such as COS, that number jumps above 3,500 stores, and the company is expanding its locations by 10% to 15% each year.” (Quartz).
iii. Trend-based: As indicated above, the vast majority of fast fashion retailers stock trend-based garments and accessories, particularly those derived from the most recent runway collections at any given time. Due to the speed of manufacturing, fast fashion retailers are able to get their garments and accessories, which are commonly line-for-line copies of designer goods, to stores long before the actual designer. “Fast fashion poses a threat since its logic is based on copying the designs of high-end producers and quickly diffusing them—sometimes even before the high-end goods, which are based on a complicated and high quality supply chain, are distributed. As such, it mines the overall investment in style by design departments of high end producers.” (US News).
This model of manufacturing and marketing thrives on constant change and the frequent availability of new products. The continuous release of new, trend-drive products essentially makes the inventory a highly cost effective marketing tool that drives consumer visits, increases brand awareness, and results in higher rates of consumer purchases. One soruce reports: “Fast fashion companies have also enjoyed higher profit margins in that their markdown percentage is only 15% compared to competitors’ 30% plus.” (Hines, Tony. 2001. “Globalization: An introduction to fashion markets and fashion marketing.”). To keep customers coming back, high street retailers routinely source new trends in the field, and purchase on a weekly basis to introduce new items and replenish stock (Tokatli and Kizilgun 2009).
“It’s not uncommon for shoppers to wear items once or twice before discarding them. Sometimes, it’s not even a choice because the garments are so poorly made that they fall apart after only a few wears.”
iv. Disposability: Disposability plays a key role in fast fashion. “Fast fashion has paved the way for outright disposable fashion. It’s not uncommon for shoppers to wear items once or twice before discarding them. Sometimes, it’s not even a choice because the garments are so poorly made that they fall apart after only a few wears.” (US News).
Labor Concerns Associated with Fast Fashion
A number of tragedies have been directly connected to the production of fast fashion and its lower manufacturing and labor costs. In order to offer low cost clothing, fast fashion retailers source garments and accessories from factories in countries where labor costs are extremely low. For years, this was largely in China. However, “factory workers in China are increasingly pressing for higher wages. Companies have responded by moving production into places where wages are even lower, like Bangladesh.” (NPR).
India, Cambodia, Vietnam, Indonesia, and Turkey, among others, have become popular locations for the sourcing of fast fashion garments and accessories. However, such countries largely lack the sophisticated manufacturing infrastructure of China. Per Maxine Bédat, co-founder of Zady: “Low cost means low regulation. Governments in today’s textile producing countries have little oversight into what happens in their factories.” (CNBC).
This extends to labor conditions and wages. The health of laborers “is affected by the chemicals used to produce the cheap fabrics made into T-shirts that are snapped up for $5 in Western stores.” (BI). Moreover, “in the rush to fill the void, tragedy has sometimes ensued.” (NPR).
Most significantly, in April 2013, “the Rana Plaza factory collapse in Bangladesh, in which more than 1,100 garment workers died, showed the lengths to which manufacturers will subvert zoning, labor and safety requirements to score contracts and keep inventories full of on-trend fashions at bargain-basement prices.” (Al Jazeera).
On the heels of the Rana Plaza building collapse, safety problems are still extremely widespread: “A recent inspection of Bangladesh garment factories was conducted in connection with the Accord for Fire and Building Safety in Bangladesh, a legally binding agreement between international trade unions IndustriALL and UNI Global, Bangladesh trade unions, and international brands and retailers. The round of inspections took place at 1,106 factories used by 150 Western brands, and resulted in the identification of 80,000 safety-related problems. Per the Accord for Fire and Building Safety in Bangladesh, safety hazards were found in every factory inspected, with nearly 20 factories being labeled as bearing a heightened risk of collapse, and 110 other factories were deemed to have notable structural issues.” (TFL).
For over two years beginning in 2011, Zara was under investigation for the use of slave labor and sweatshop conditions in factories in Argentina and Brazil. In 2011, the “Spanish high-street retailer [was] accused of allegedly accepting slave-labor working conditions supplanted by more than 30 of its outsourced plants running in Brazil.” (Forbes). Bolivian immigrant workers “were caught in slave-like conditions in garment production for the Galicia-based company, which is part of the Inditex group.” (Forbes).
Less than two years later, “immigrant workers, including children, were discovered by the workers’ rights group, La Alameda, producing clothes for Zara in ‘degrading’ sweatshop conditions, investigators claimed […] They were not registered and they were living in terrible conditions. They had no official documents and were held against their will, they were not allowed to leave their workplaces without permission.” (Telegraph).
In October 2014, textiles mills in the Tamil Nadu area of India have been accused of employing forced labor and have been linked to major fast fashion giants including H&M, Primark and C&A. According to “Flawed Fabrics,” a report from the Centre for Research on Multinational Corporations and the India Committee of the Netherlands, which was compiled “through a mixture of desk research and interviews with workers,” an array of core labor rights are being violated. Girls and young women are “being lured from their home villages [at as young as age 15] by false promises” and are working under “appalling, prison-like conditions” in which the women are often bonded. (TFL).
In early 2014, at least four people were killed and more than 20 were injured when police outside Cambodia’s capital opened fire to break up a protest by striking garment workers. Wages in the garment-manufacturing sector in Cambodia remain low by international standards. In October 2015, Government officials in Cambodia announced that they will raise the minimum wage for clothing workers by 9.4% to $140 a month, hoping to ease tensions in the country’s main export industry. The new wages take effect at the beginning of 2016, but the increase falls short of the $160 a month wage proposed by unions. (TFL)
Environmental/Sustainability Concerns Associated with Fast Fashion
Fast fashion is, by its very nature, “a fast-response system that encourages disposability.” (Fletcher 2008). With brands like H&M “producing hundreds of millions of garments per year,” there is a growing public consensus that the mass production of so much cheap clothing is an enormous waste of resources such as fuel and water. (NPR). As an industry, “Fast fashion depletes the Earth’s resources and uses slave labor all over the world.” (Vogue).
In addition to a lack of regulation in terms of working and safety conditions and wages, environmental and related regulations stemming from the use of chemicals and pollutants are lax in low cost centers of manufacturing. As such, “textile companies just keep engines roaring, running largely on coal, while they systematically dump their chemicals untreated back into their local water. This has all added up to the apparel industry being the second most polluting industry in the world, behind only the oil sector.” (CNBC).
And the side effects do not stop there. The increase in production of garments and accessories has lead to an increase in waste: “Inevitably, much of this excess finds its way into landfills. In the US alone more than 10.5 million tons of clothes end up in landfills each year, and even natural fibers may not break down easily.” (Quartz).
*This story first appeared on The Fashion Law
IFC Partners with VF Corporation and Target Corporation to Promote Manufacturing Sustainability in Vietnam’s Textile and Apparel Industry
Hanoi, Vietnam, March 15, 2016—IFC, a member of the World Bank Group, is partnering with global leading apparel and footwear company VF Corporation and consumer products retailer Target Corporation to improve resource efficiency at their supplier factories in Vietnam. Under the first phase of this program, energy and water efficiency assessments will be conducted at about 30 factories over the next 12 months to help them reduce operating costs and improve productivity while contributing to the country’s green growth and climate change targets.
The textile, apparel and footwear sector is a significant contributor to Vietnam’s economy. In 2015, the sector’s exports reached $39.2 billion and generated approximately three million jobs, most of which are for women. While this sector is energy and water intensive, there are opportunities for reducing resource consumption by 20% or higher by using latest technology and good operating practices.
“With Vietnam’s increasing participation in trade agreements, including the Trans-Pacific Partnership and the EU Free Trade Agreement, the local textile sector is poised for faster growth, creating increased demand for sustainable energy and water use practices,” said Kyle Kelhofer, IFC Country Manager for Vietnam, Cambodia and Lao PDR. “Vietnam’s textile enterprises stand to benefit from this IFC program by further access to global markets while implementing resource efficiency best practices.”
Factory assessments at VF and Target supplier factories across the textile value chain, including cut-and-sew, dyeing-and-printing and garment-washing operations, will identify and develop cost-effective measures to improve energy and water efficiency while helping suppliers improve productivity and competitiveness. In addition to providing advice for technical solutions, IFC will help facilitate financing through its partner banks in Vietnam, drawing on its substantial experience in other top textile export countries such as Bangladesh and China.
“The cooperation with IFC in Vietnam strongly complements Target’s global responsible sourcing strategy and our corporate sustainability goals for making supplier factories more resource efficient and environmentally friendly,” said Ivanka Mamic, Director for Responsible Sourcing at Target Sourcing Services, the subsidiary of Target Corporation leading sustainability efforts for the corporation.
“VF has a long history of manufacturing excellence centered on respect for the people and the environment, and we continuously explore opportunities to further scale these commitments across our global supplier base for greater impact,” said Brad van Voorhees, Senior Manager for Supply Chain Sustainability at VF Asia, a subsidiary of VF Corporation. “The collaboration with IFC and Target is a natural extension of our work and enables the collective exchange of knowledge and best practices to green the textile supply chain.”
This manufacturing sustainability initiative will promote resource efficiency by systematically assessing performance improvement opportunities, conducting benchmarking studies, sharing technology best practices, and raising sector-level awareness for broader uptake. Subsequent phases will evaluate opportunities for use of clean energy to meet captive power needs of the textile supply chain. This initiative is part of IFC’s multi-year Vietnam resource efficiency program that is implementing innovative aggregation approaches to scale-up impacts through engaging with leading global brands and their supply chains, and by intervening in selected industrial zones to promote circular economy concepts among co-located industries.
*This story first appeared on Sustainable Brands
The Vietnam Ministry of Industry and Trade has published Circular 32/2009/TT-BCT that became effective as of December 20, 2009. This interim regulation specifies the content limit of formaldehyde and azo dyes in textile and apparel products that are manufactured, imported and traded in the Vietnam market.
Regulated textile and apparel products imported to Vietnam now require a certificate issued by an accredited testing laboratory that shows compliance test results to this regulation for the purpose of meeting customs clearance requirements.
Overview of Requirements
– Fabric used in the construction industry
– Fabric lining used in the automobile and tire industry and on motorcycles
– Fire-resistant clothing for special requirements
– Industrial canvas products for special purposes
– Fabrics imported for the processing of export products
Circular 32/2009/TT-BCT (in Vietnamese)
*This post first appeared on Bureau Veritas here.