Fashion Brands, Long Focused on Excess, Are Finally Waking Up to Sustainability

Can eco-friendly startups shift industry values?

When Yael Aflalo, founder of buzzy fashion retailer Reformation, experienced first-hand the scale of Chinese pollution, she made a decision. Today, her company has a near-religious focus on reducing waste by incorporating sustainable practices throughout its supply chain.

Ana Andejelic

Reformation's motto: "We make killer clothes that don't kill the environment."

Reformation gets that people increasingly make buying decisions based on evaluation that is simultaneously monetary and social. For fashion brands, that means fashion and sustainability must co-exist. When people buy pieces of Reformation clothing, they pay for the knowledge of how and where each item was made. They're paying a premium not just for the great fit and quality of Reformation's products or to wear the badge of a hot brand, but also for something they believe.

Of course, there are plenty of people who maniacally buy clothes just because they are cheap. But there is an increasing number of fashion consumers who redefine what the price for a piece of clothing means; for them, a price is also appraisal, praise and prize.

It's not surprising then that the fastest-growing fashion upstarts today sit precisely at this intersection of doing good and doing well, of price and praise. They express market price in terms of environmental footprint of their items and through the benefits of those involved in the production process. Repurposed vintage clothing suddenly became more valuable than Bangladesh-made, brand-new garments.

Fashion startups scale their business not through churning out massive volumes of merchandise (current fast-fashion retailers pay less per garment to manufacture 10,000 pieces than to make 1,000) but by doing things that don't scale. They all offer custom-made, limited-batch, season-resistant, story-rich and built-to-last items that are released one by one a few times a year.

This is Reformation's model. But there are others.

Fashion marketplaces, subscription services or sharing economies are all viable and sustainable business formats. Many fashion startups do not have any inventory to speak of. Vestaire Collective and TheRealReal are marketplaces that connect high-end fashion buyers and sellers. They are in the business of making the value exchange seamless, convenient, intuitive and efficient.

Rent the Runway, a high-end fashion rental service, and Material Wrld, a clothes-swapping platform, make closets a little bit less crowded without taking away the thrill of access to the new garments. They let us enjoy fashion without owning it.

New retail models are all valuable alternatives to the traditional fashion economy built around secrecy, waste and volume—and they are valuable precisely because they capitalize on Big Fashion's failures.

In contrast to the time-bending schedule of luxury fashion and the equally accelerated pace of fast-fashion, fashion startups take their time with their ideas, test, iterate and incubate them, often together with their biggest fans. By eliminating the middleman, fashion startups both cut their costs and stay close to their customers. The benefits of this customer-centric, test-and-learn approach is having a consistent—and consistently coveted—brand look, and dialing up and down on products that work and don't work.

For a growing portion of today's fashion consumers, the custom-made, limited-edition and built-to-last items are exactly what they deem worth their money. In the old-school economy, calculation and judgment were regarded as separate processes. Value was economic; values were social. There was no mixing of the two. This gave us climate change, labor exploitation and unsafe work conditions.

Fashion is the third most polluting industry, and it is the second-largest consumer and polluter of water. In China alone, the textile industry created 2.5 billion tons of wastewater and 3 billion tons of grime each year. In the U.S., over 85 percent of clothing thrown away in ends up in landfills, instead of being reused or recycled. That means that your polyester Victoria's Secret bra will outlive your grandchildren's grandchildren.

As more consumers became aware of these facts, the hope is that they will take them into account when making decisions about their next fashion purchase. Right now, companies like Reformation are our canary in the coal mine. They show us where the future of fashion is going, and in this future, the world's wealthiest retailers may simultaneously be its least worthy ones.

Ana Andjelic (@andjelicaaa) is svp, global strategy director at Havas LuxHub.