| Dave Kaufman – host: | On April 4th, the news was grim. The Intergovernmental Panel on Climate Change, also known as the IPCC, released their third and final section of their latest review of climate science. They described it as their final warning for world governments to act before the climate damage becomes irreversible. |
| Dave Kaufman – host: | Among the many findings of the IPCC were the immediate phasing out of coal, the reduction of methane emissions by one-third, and that all sectors of the global economy, from energy and transport to buildings and food, must change dramatically and rapidly. Today’s episode looks at the world of fast fashion, a subsection of an already problematic industry that has only made the fight to protect the planet even more difficult. |
| Dave Kaufman – host: | At a time when oil and gas take up so much of the conversation surrounding the environment, the impact of textile production on climate change should not be minimized. Did you know that 10% of all global and greenhouse gas emissions are caused by clothing and footwear production? That’s more than all maritime shipping and flights combined. It’s time to find a more sustainable model, yet society’s obsession with fast fashion is only making the problem worse. |
| Dave Kaufman – host: | Let’s find out how we can fix this together. Welcome to the second season of The “New Normal,” the podcast exploring management research brought to you by Delve, the official thought leadership platform of McGill University’s Desautels Faculty of Management. I’m your host, Dave Kaufman. On this episode of The “New Normal,” we will discuss the extreme negative environmental impact of the fast fashion industry, as well as what can be done to lessen its footprint. |
| Dave Kaufman – host: | We’ll also look at certain initiatives that have already been undertaken and see if they make any difference at all. Finally, we’ll see if there’s any feasible alternative to fast fashion that could make the industry more sustainable. Joining me for this episode is Dr. Javad Nasiry, an associate at professor of operations management at the McGill Desautels Faculty of Management. His main research interests are in behavioural operations, supply chain management, sustainability, and empirical operations finance interface. |
| Dave Kaufman – host: | His research in sustainable operations focuses on the environmental consequences of new business models in apparel, renewable energy, and agricultural industries. First, let’s define fast fashion. Fast fashion is a method of producing clothing at high volume and low cost. It’s clothing that brings inexpensive fashion to the forefront by imitating high-end fashion styles, but at a fraction of the quality and at a fraction of the cost. Its popularity has soared in the last 20 or so years, but how fast is fast fashion? If you ever wondered why that cheap t-shirt you bought falls apart so quickly, Professor Nasiry explains that sadly that’s the manufacturer’s plan. |
| Javad Nasiry: | The intention is not to buy and wear the clothes for the extended amount of time. The idea is to buy, wear for a couple of occasions perhaps, and then you throw it away. That’s essentially what’s happening in one part of the market. This is creating, of course, a lot of issues. |
| Dave Kaufman – host: | This wasn’t always the case. Fast fashion used to mean it would last a season or several months. But as logistics and manufacturing have become more efficient, competition has driven the price and quality even lower. |
| Javad Nasiry: | In the 1990s, it was hailed as a very interesting business model because they could get the product from design to a product on shelves for consumers to buy in two weeks, in 15 days. It’s so fast that they termed this is fast fashion. And of course, the term stuck since then, and we have had many other companies since then joining this ecosystem. There was a very interesting headline a while back saying the enemy of fast fashion is faster fashion. These companies are introducing 600 new styles every week. |
| Javad Nasiry: | What we have is something like this where the models are coming into the company. And then from 9:00 AM to 4:00 PM, they are trying out different styles. If a style gets the go ahead, then they will simply produce it and put it on the shelves in a few days. The reason that these business models are successful is because customers have a willingness to pay for these styles and products. But of course, the waste side is not really taken into account in these business models. |
| Dave Kaufman – host: | I asked Dr. Nasiry why the consumer is choosing to purchase fast fashion products. He states that fast fashion ticks a lot of boxes for the buyer and that it’s difficult to reject the allure of all those products. |
| Javad Nasiry: | I believe customers appreciate the one big advantage of fast fashion. The way they have positioned themselves in consumer markets is we have democratized fashion, which means essentially we have made fashion available to the masses. Relatively low prices, but these are the latest fashion trends that you can find on the catwalks and so on and so forth. Customers like the variety that they can find in fast fashion stores. That’s the way let’s say Boohoo or let’s say Forever 21 or Zara and Fashion Nova in California, US and so on and so forth positioned themselves. And customers value variety. |
| Dave Kaufman – host: | The customer might look good and the cost is substantially lower than with regular fashion. But I wanted to know if the customer is aware of the environmental impact that fast fashion has. |
| Javad Nasiry: | I would say increasingly so. But as I mentioned also with some examples like micro fashion trends, it’s not ubiquitous yet. It’s not like everybody is aware of this. But I would say increasingly so, customers are coming to understand that there is a dark side to fast fashion. When they buy these items, wear them for a couple of times, and throw them away, then they’re creating problems down the road. You could see more and more customers switching into let’s say slower fashion item, so higher quality items. They tend to pay higher prices, of course, but then they can use it for a longer time. And even when you are done, the product has still residual life in it, so they can maybe donate it or so on and so forth. |
| Dave Kaufman – host: | From what I’ve read in advance of this conversation, the environmental impact of fast fashion is several fold that of slow fashion, right? |
| Javad Nasiry: | Yes, that’s right. That’s right. You got to see the entire supply chain of fast fashion, right? We started from the land and the water resources that you use in order to grow the fabric that you will end up using in the production of fast fashion. And then essentially we have the production processes, and then we have the consumption and post consumption stage. Waste comes in all of these stages. |
| Javad Nasiry: | A holistic solution to the problem of waste needs to take into account which part of the supply chain you are trying to focus on and also the consequences of the solutions that you are developing in one part on the entire supply chain. You are absolutely right in that sense, that waste has different sources. It could be in the amount of water that you are using, or let’s say the land usage. It could be in production processes. It could be in consumption itself, wear and tear, and also in the post consumption stage, what do you do with the clothes that you don’t use anymore. |
| Dave Kaufman – host: | If they’re fast fashion, the clothes go straight to the garbage. Then the landfill. In the world of fast fashion, there are no hand me downs. The consequences of producing clothes that only get worn a handful of times before being thrown out are staggering. Let’s look at some of the short and long-term consequences of fast fashion. Professor Nasiry says that some of those effects can be drastic. |
| Javad Nasiry: | Short-term consequences will be the problem of waste that we have to deal with. This is the short-term consequence that developed countries have to deal with. Europe, for example, right now has this now and present problem of dealing with waste in fast fashion supply chains. The same also in US, in Canada, in other developed countries. This is an everyday headache now, how to control the waste without essentially affecting the economy in negative waste. |
| Javad Nasiry: | That’s essentially the problem right now, and that’s the reason you see every single day we have reports from apparel industry, fast fashion industry, trying to understand the ways that they can control the waste. In the long-term, the problems will be much bigger if we don’t take care of this. Because again, remember the upstream supply chain problems, the land usage, the water resources usage, the labor practices that these supply chains are following. This is going to have a lot of consequences down the road, because in the end, these resources are limited. And if you are using them for this purpose, then you won’t have enough for agriculture. You won’t have enough for other purposes. And that’s going to be a really, really big problem down the road. |
| Dave Kaufman – host: | Great. At a time when we need to be better stewards of the environment, fast fashion is adding an extra wrinkle of complication. While far from a solution, making fast fashion more sustainable would at least be the start of an acknowledgement that there is a problem. I asked Professor Nasiry, if there’s anything that can be done to convince these manufacturers to lengthen the lifespan of their apparel. |
| Javad Nasiry: | Creating incentives for innovation in recycling technologies dedicated to apparel is going to be one way to keep fast fashion alive, if we can manage to create new business models, new technologies to take care of the waste. Fortunately, we do have some ideas going on. We do have some technologies, but they are not economically viable at the moment. We do have business models, for example, renting clothes. I’m a manufacturer. I build high quality material clothes and I rent them out. You can use it let’s say for one or twice, and then you just bring it back to me. I will clean it up, and I will let somebody else use it. We do have these business models, these technologies up and coming, but we need to provide the right incentives for innovation to continue in this domain. |
| Dave Kaufman – host: | The problem as always comes back to convincing a company to tinker with what has become a lucrative business model. |
| Javad Nasiry: | And then essentially fast fashion can perhaps be economically viable, but fast fashion companies themselves with the current ecosystem that we have, very difficult for me to imagine how they could be doing this. For example, H&M has pledged to be sustainable fashion by 2040. And by that they don’t mean they’re going to change the business model. What they mean is we will be using sustainable fabric. At the moment, recycling fast fashion clothes is extremely hard. First of all, collection is tiny. Even if you manage to collect them, the amount that you can recover from them is actually tiny simply because these are synthetic material. |
| Dave Kaufman – host: | The problem feels almost binary. Like there’s no middle ground between fast fashion and environmentalism. |
| Javad Nasiry: | Yes. Unfortunately, at the moment, that’s the picture we have. In Europe, they called it a crackdown on fast fashion because they just can’t find a way. They have tried, by the way. For example, H&M was caught red handed burning the unsold merchandise a few years back because they could not sell it. These are new clothes they could not sell. They don’t want to dilute the brand. They were caught incinerating unsold new items. The Swedish Parliament banned that practice after they were caught. |
| Javad Nasiry: | And then we have had also other initiatives. I believe it’s in France that for each and every piece that you produce, you will also have to pay something to the government, because they claim they collect this and they invest this in post consumption recycling facilities, or we have in some other places production tax or penalty for leftover inventories and so on and so forth. Each of them have tried to take care of the problem. They have been successful to some extent, but the point is the problem still continues and they will have to find a way to control the waste until they have, as I mentioned, that much bigger picture where everything is in its place. Even if you’re going at high speed, you have ways to control the side effects of that speed. |
| Dave Kaufman – host: | Europe has begun to try to tackle the problem. On March 30th, the European Union proposed new rules, that demand that clothes, furniture, and smartphones sold in Europe must be longer lasting and easier to repair. Ioana Popescu of the Environmental Coalition on Standards told the BBC that the new rules have been designed to bring in longer lasting products that could be used multiple times, rather than worn just a few times and thrown away. |
| Dave Kaufman – host: | According to the European Environment Agency, clothing used in the European Union has on average the fourth highest impact on the environment and climate, exceeded only by food, housing, and transport. The proposals will now be discussed and debated by the European Parliament. The EU has begun to take steps to try and combat fast fashion, but it’s a slow process. |
| Dave Kaufman – host: | I asked Professor Nasiry if he thinks that initiatives like this will make a difference, or if they’re just a drop in a very large bucket. He says yes and points to other nascent initiatives, such as the growing trend of apps like Vinted, an online marketplace where individuals can see element trade clothes that they don’t want to wear anymore. |
| Javad Nasiry: | I believe it’s possible. There needs to be investment in order to motivate innovation and new business models dedicated to this particular problem. We do have very good ideas coming up. As I mentioned, rentals or exchange markets and so on and so forth. We also have peer to peer markets. No companies are involved. Just a platform that you can sell your own clothes to somebody else or buy from them. But at the moment, these are very tiny and they do not really make a dent in the amount of waste generated. |
| Dave Kaufman – host: | I would argue that the second that these apps did make a dent, they’d be making a dent in H&M’s profit margin. And suddenly, I wouldn’t be buying a new shirt. I’d be borrowing it or, in some cases, renting it. I still have a lot of trouble seeing a world where fast fashion and environmentalism can walk hand in hand. Professor Nasiry suggests that getting these companies involved in developing new green technologies may be the answer that we’re looking for. |
| Javad Nasiry: | It could be because they have to subsidize these technologies, maybe they will have to invest in collection schemes. Maybe they will have to integrate with these recycling facilities and something like that, but they cannot exist on their own for much too long, at least I hope so. The problem they’re creating is getting too serious to ignore. And as I said, it’s not just the apparel that we use and throw away. It’s also the pressure on the land, on the resources, on the labor. |
| Javad Nasiry: | This is not sustainable in the long-term. At some point, either they have to integrate the entire picture and give up some of the surplus to take care of these things, or they will have to slow down. Otherwise, many countries are not happy to continue with this model anymore. |
| Dave Kaufman – host: | Professor Nasiry’s research highlights the perils of fast fashion. His thesis points to establishing some guidelines like economic penalties for the manufacturer and education of the public that could, I repeat, could make a difference. |
| Javad Nasiry: | If you want to kind of get the desired result, that system, that ecosystem that you design, you need to take into account different players in the supply chain, how they react, and then make sure that the overall outcome will be the reduction of waste, maybe higher quality, and so on and so forth. For example, you could impose penalty on leftover inventory, but at the same time, you will have to invest on consumer education. |
| Javad Nasiry: | We do have very interesting campaigns, especially in developed countries that are major consumers of fast fashion, on educating the customers. There was this very interesting exhibit, I guess it was in Vancouver, showing a pile of apparel waste in the street. And essentially people coming around asking, “What is a mountain of garbage doing in the middle of the street?” And they said, “This is fast fashion, garbage that nobody used in Vancouver they have thrown away.” |
| Javad Nasiry: | You are essentially creating this awareness in the customers, which means when I go and buy, now I’m aware and I will say, “Maybe I would buy a higher quality item instead of a lower one.” If you also create that incentive, the company doesn’t have the option of lowering the quality as well. If I lower, they’re not going to buy. I need to meet the quality at the same time that I need to bring down the leftover inventory. You need to kind of take into account different things at the same time to make sure that the desired result is going to follow. |
| Dave Kaufman – host: | At the end of the day, so much of this problem, unfortunately, comes back to the choices made by the consumer. If the customer becomes aware of just how bad fast fashion is and that they are significantly adding to their individual waste footprint by purchasing it, could that be enough to force a manufacturer to change their production habits? |
| Javad Nasiry: | You are raising a very good point. I do not want to exempt the consumers from this problem, right? I think consumers are part of the problem, not necessarily all the time essentially, because we do have as consumers a preference for variety. We like variety. Sometimes we fail to understand the consequences of the decisions that we make to purchase and consume. We are the ones in the end, at the end of the day, buying let’s say every single different version of iPhone or let’s say Samsung. |
| Javad Nasiry: | There is demand for this. There is some inherent psychological pressure in us to look good to our peers. Micro fashion trends that I mentioned is actually much more popular among the younger generation because they want to look different. They want to look good. They want to look this in that party and that party, which means there is demand. Companies take advantage of that and they also let’s say inflame it. They also encourage it. They try to make it look cool that you change clothes so often. |
| Javad Nasiry: | You don’t need to take care of those things. You can just buy a new one. They also encourage. You see, it’s this kind of vicious cycle. The consumers in this case are also responsible. You cannot excuse them. But if they become more and more aware of these things, then yes, essentially they will put the pressure on companies to be more responsible. |
| Dave Kaufman – host: | As we conclude our conversation, I’m left feeling a bit discouraged. Is the lure of cheap fashion too strong to convince the customer that the environmental negatives so far outweigh the stylish positives? And can measures like the ones proposed in the EU make a difference when the clock is so obviously ticking towards environmental catastrophe? |
| Dave Kaufman – host: | Professor Nasiry says that in order to achieve sustainability, capitalism needs to be brandished as a driving force and not as a millstone around the neck of the industry. Nasiry suggests that the way to achieve this is to insist that fast fashion slow down. |
| Javad Nasiry: | If fast fashion wants to survive, what it is that it has to do? Maybe a way to go would be to slow down a little bit. Slowing down to make sure that every part of the supply chain catches up so we can create that in that ecosystem first and then cater to the variety seeking behaviour of our customers. My philosophical take on sustainability is something like this. |
| Javad Nasiry: | At the moment, the approach is to say, “We have a profitability framework, so we are profit maximizers as corporation, and sustainability comes as a constrain shackle of what we can do.” It becomes a nuisance. Hopefully if we can change this into a framework of sustainability within which we are trying to maximize the profit, then we will have a much more sustainable business model. |
| Javad Nasiry: | But that shift in mentality, thinking of sustainability not as a constraint, a shackle on our profit making incentives, but as something that we have to operate within and maximize our profit within it, it will kind of lead in the long-term to much more environmentally friendly, sustainable, not only in terms of environment when I say natural resources, but also in terms of what we are doing with our own psychology in society. |
| Dave Kaufman – host: | But does he really believe that a business would be amenable to being told to slow down what makes them so profitable and such a success? |
| Javad Nasiry: | Unfortunately, not on their own altogether. We need to have regulation in order to make sure that this happens over time. It’s not going to happen overnight, but hopefully over time we could proceed. We have done that in the past in certain industries. For example, in electronics, we are way ahead in comparison to fast fashion. In electronics, for example, we have much better collection schemes for products. Let’s say in case you don’t want to use your iPhone anymore, you don’t throw it away. |
| Javad Nasiry: | You can simply… Yes. The ideal way would be for us not to have Apple or Samsung or other companies to produce all these versions every single year. That will be the ideal picture. Maybe every five years, one is enough. But in absence of that ideal picture, at least we say, well, in case you are done with this old iPhone, let’s say iPhone 10, don’t throw it away. Bring it back to Apple. They will take it back. They will give you a new one, either in the form of an upgrade, or you can trade it in. We have different schemes there. We have much more efficient collection schemes, hopefully more environmentally friendly practices. |
| Dave Kaufman – host: | As a consumer, that kind of collection scheme makes much more sense for a thousand dollar iPhone than for a $7 t-shirt. |
| Javad Nasiry: | You’re absolutely right. How we can adapt the same practices in apparel, that’s something that we have to think about. At the moment, we do have segment of customers who are willing to pay more. They let go of the cheaper products. They buy more expensive clothes, but they’re happy to do that. This is happening because the producers of these clothes are using transparency strategies. They say, “This is the garment I am selling. This is the t-shirt I’m selling. |
| Javad Nasiry: | Maybe this is $15 in comparison to $5, but this is how the $15 comes up. I am producing let’s say in this location. I’m using this fabric, and my supply chain looks like this. And that’s the reason I am charging let’s say maybe a 10% surcharge. It’s going to be $15.” We do have customers who are willing to take up this offer in comparison to the other one. The point is we do have ways to go ahead. Maybe not exactly the same as the electronics or let’s say car industry, as you mentioned, but we do have ways to get into the consumer side and make them aware of what’s going on with fast fashion, and then encourage them to buy something that could be pricier, but at the same time, it’s going to be much more environmentally friendly and also in the long-term benefit everybody. |
| Dave Kaufman – host: | Will the European Union lead the way and make the fast fashion industry slow down? Are the measures that they have proposed enough to make a difference and help the world attain the IPCC targets? The answer is probably not. Global action is needed, not just regional. And most importantly, human behaviour needs to change. As perfect as the business model of fast fashion has proven to be, it’s also hastening our demise. We know the problem. We know how to fix it. Will we? |
| Dave Kaufman – host: | Stay tuned as we navigate at this new normal together. The “New Normal” is brought to you by Delve, the official thought leadership platform of McGill University’s Desautels Faculty of Management. I’m your host, Dave Kaufman. Producers of today’s episode, Dave Kaufman, Robyn Fadden, and David Rawalia. The technical producer of The “New Normal” is David Rawalia. |
