The coronavirus pandemic has once again put fast fashion companies in the public eye. Lockdown measures needed to reduce the spread of Covid-19 across the globe have led to a slump in demand for new clothes, causing a ripple effect along international supply chains. According to a May report in the Financial Times, cotton prices are forecast to fall to a 15 year low.
Tense relationships between fast fashion companies and their suppliers as a result of buyers cancelling existing orders have highlighted the possible abuse of unequal relationships and the vulnerability of workers. McKinsey estimates that the revenues of the global fast fashion industry, including apparel and footwear, will contract by 27-30% year-on-year in 2020, then recover marginally in 2021 with 2-4% positive growth. But some companies will not survive the crisis as bricks and mortar stores remain closed and cash-strapped consumers reduce their discretionary spending.
The word crisis has its roots in the ancient Greek “krisis” meaning decision, judgement or a turning point. It is only fitting then that we seize this moment to rethink our choices as consumers and investors.
We have previously highlighted the environmental costs of fast fashion and the need to move towards circular approaches. Work by the Ellen MacArthur Foundation has highlighted the pollution and waste from textile manufacturing. It estimated that 73% of garments ended up in landfill or were incinerated in 2015, while less than 1% were recycled.
In its report, McKinsey argues that: “The pandemic will bring values around sustainability into sharp focus, intensifying discussions and further polarising views around materialism, over-consumption and irresponsible business practices.” The AlphaWise consumer survey conducted by Morgan Stanley in February 2020, before the pandemic reached its height, found that 70% of respondents had a preference for more sustainable clothing, while 58% said that they were already buying fewer items. The coronavirus could exacerbate this trend, making fast fashion “unfashionable” for consumers with an increasing awareness of the environmental damage linked to textile production.