The Pulse report projects that by 2030 fashion brands will see a decline in EBIT margins of more than 3 percentage points if fashion companies continue to do business as usual, which adds up to approximately €45 billion per year of profit reduction for the entire industry. This is mainly because labour costs are expected to continue to outpace growth in retail value, cotton prices will remain relatively stable although increasing water scarcity worldwide could potentially affect the cost of future cotton production and energy prices are projected to increase steadily. To capture the potential lost value and to protect their bottom lines, businesses must act now and pursue novel solutions to maintain and ensure profitable growth going forward.
Today, Global Fashion Agenda is pleased to announce that Danish fashion giant BESTSELLER has joined its group of Strategic Partners. About the decision Dorte Rye Olsen, sustainability manager at BESTSELLER, says: “We believe a common and focused effort is needed to create a more sustainable fashion industry. Therefore, we’re happy to enter into this partnership with Global Fashion Agenda, and we are convinced that we can learn from each other’s experiences and together have a positive impact on the global fashion agenda.” BESTSELLER joins the founding group of Strategic Partners, which includes H&M, Kering, Target, Sustainable Apparel Coalition and Li & Fung.
The end-of-use phase is a significant sinner in the fashion value chain. The newly published Pulse of the Fashion Industry report concludes that fashion brands score an average of 9 out of 100 at the end-of-use phase, the absolute lowest in the entire value chain. This shows that most brands have not yet recognised the opportunities of the end-of-use phase. A circular fashion model would not only be sustainable in terms of resources but there are clear indications that it would also make sense financially.