By: Noelle Puvak and Haley Dymek
Edited by: Andrew Bongiovanni
Graphic by: Arsh Naseer
Introduction
Today, fast fashion—the business model built on the mass production and supply of retail goods at relatively low prices––remains steadily on the rise, connecting consumers to the newest runway looks for much less. Reaping $1.2 trillion annually,1 the fast fashion industry has expanded extensively in recent years, largely propagated by the interplay between consumer demand and an increasingly globalized supply chain. The term ‘fast fashion’ was coined after the first Zara store opened in the United States in 1989. The Spanish company aimed to turn a garment from an idea in a designer’s mind to a product on the racks in store in 15 days.2 Today, it is estimated that this process takes the Chinese fast fashion company, Shein, one week.
So how did we get here—how has the fashion industry seen such tremendous growth? Beyond the fact that everyone wears clothes, the industry has relied on several key business strategies to achieve this surge in production. Among these, companies have relied on offshoring, cheaper materials, and the use of rapid lead times, to both expedite manufacturing rates and reduce costs. These quick lead times in the fast fashion industry should warrant concern because they stem from companies racing to the bottom to sell apparel the quickest and cheapest. Fast fashion companies have received criticism for their resounding disregard for the safety of other textile and garment workers. This paper addresses the fast fashion industry’s disregard for environmental sustainability and labor rights. It provides key recommendations for policymakers in holding fashion companies more accountable for their global supply chains and pollution.
The Rise of Mass-Produced Apparel
During the 1990s, increased trade liberalization incentivized lenient regulations on the exportation and importation of textiles and clothing than before. Initiated by NAFTA, and the General Agreement on Trade and Tariffs (GATT) subsequently, the world oversaw a transformation to what had previously been a highly regulated trade during the post-WWII era. The emergence of the World Trade Organization (WTO), and then its replacement, the GATT, opened the door for reduced trade barriers across continental borders. After 2005, the Multi-Fibre Agreement, a key international trade agreement on the trade of textiles and apparel, relinquished all of its previous quotas.3 This benefited retail firms that welcomed the opportunity to outsource materials for cheaper prices to countries such as China and Bangladesh, the latter of which has rapidly emerged as a lead exporter within the industry. Over the years, retailers have effectively exploited the comparatively low-wage brackets in these countries and trade regime shifts to bolster their growth and raise their profit margins, at the expense of ethical concerns.
Business Strategies and Policies
In 2022, the fast fashion industry was estimated to be worth over $106 billion, a $15 billion increase from 2021.4 Researchers estimate that by 2028 the industry will be worth about $185 billion.5 The fast fashion industry could not have achieved this size without its ‘race to the bottom mentality’ to make the most profit by selling apparel quickly and at low prices. This race to the bottom has committed fast fashion companies to pursuing business strategies with little regard for workers’ rights and the environmental consequences.
Fast fashion companies closely follow the latest trending styles and consumer tastes to constantly restock their stores with new apparel. In-house R&D employees act fast to finalize designs and inventory levels to capitalize on popular styles. Employees meticulously match supply and demand to determine minimum inventory levels to save costs.6 Now, consider the short product life cycle of fast fashion. Before fast fashion, most clothing had relatively long product life cycles because they were designed to last two to four retail seasons.7 Fast fashion introduced low-quality apparel with short product life cycles to the market.
Together, the short product life cycles and quick lead times employed by companies create an insatiable need for new merchandise. This puts immense pressure on suppliers to not only produce the dictated quantity but also ensure that products arrive in store when their design is still in high demand.8 For this reason, fast fashion companies offshore the ‘Assembly’ and ‘Component Production’ stages of the supply chain, as seen in Figure 1, to secure the cheap mass production of their products.
Figure 1
Source: Robert C. Feenstra and Alan M. Taylor, International Trade (New York: Worth Publishers, 2021).
In less economically developed Asian countries, there are looser labor and environmental regulations,9 resulting in the use of unsustainable, low-quality materials like polyester and nylon in fast fashion apparel. While these synthetic fibers are cheaper than natural fibers like cotton and wool, they are worse for the environment.10] Producing synthetic fibers and making apparel out of them rely on fossil fuels, which are known to contribute to pollution and climate change.11
For fast fashion companies based in the U.S. and Europe, offshoring textile and garment production means that the workers abroad who carry out this manufacturing suffer the most from the adverse effects of the fossil-fuel-based production of fast fashion apparel. In other words, establishing a global supply chain by offshoring manufacturing also entails offshoring pollution and greenhouse gas emissions.12 This practice in the fast fashion industry undoubtedly benefits the U.S. and Europe as they continue their efforts to reduce their own greenhouse gas emissions.13
Not only do fast fashion companies circumvent environmental responsibilities by offshoring, but they also shirk employer responsibilities. Offshoring textile and garment manufacturing to countries with looser labor regulations produces a serious lack of accountability for companies as to how they treat these workers. With all this in mind, two key reasons for the fast fashion industry’s race to the bottom emerge. Fast fashion companies are always searching for ways to first speed up, and reduce the cost of production, and second, to avoid taking responsibility for the consequences of their actions.
Trade Policies
As fast fashion companies operate in global supply chains, encountering international trade laws is unavoidable. The ongoing US-China trade war highlights how trade policies complicate the fast fashion industry. As of 2020, most apparel imports from China into the US face a 7.5% tariff enforced under Section 301 of the Trade Act of 1974. On one hand, fashion and retail associations argue that the Section 301 tariffs raise costs for American companies and consumers.14 On the other hand, the International Trade Commission has found that importers face little to no increase in prices due to the tariffs.15 One thing that both sides of this argument do agree on is that China has become more resilient in retaining its leading role in fashion supply chains.
Chinese suppliers have maintained most of their business with US apparel companies due to Beijing’s efforts to artificially slash prices. 16,17 In this sense, the trade war meant to––among other issues––inhibit China’s unfair trade practices has been unsuccessful in the fashion industry. Chinese fast fashion companies are notorious for circumventing regulations. Last year, the House Select Committee on the Chinese Communist Party reported Shein’s and Temu’s abuse of the US law that shipments are only subject to tariffs when the value is over $800. Shein and Temu have avoided $64 billion and $100 billion in tariffs through this loophole, respectively.18 With US Customs and Border Protection grappling with a plethora of small shipments, companies routinely get away with providing incomplete import data. For the Chinese companies, Shein and Temu, this means avoiding human rights import reviews like the Uyghur Forced Labor Prevention Act.19 This underscores the imperative for both corporations and policymakers to ensure that the rules or trade and ethical considerations are not sidelined in the pursuit of profit.
Supply Chain Globalization
China remains the dominant choice for sourcing, but geopolitical shifts are driving fashion companies to diversify their supply chains. This trend is part of a broader risk management approach to reduce dependency on China. Some apparel companies, for instance, began importing more from Bangladesh, Vietnam, India, and Cambodia in response to the trade war tariffs against China.20 For fast fashion companies, offshoring manufacturing is a means to pass on their low-cost demands to their supplier. In other words, geopolitical factors aside, fast fashion companies will source from wherever they can squeeze their suppliers the most.
While fast fashion brands attract customers with competitive prices, foreign suppliers compete to land contracts with fast fashion brands. Suppliers underbid with the promise of cheap and quick production. For instance, Bangladesh competes with China by paying garment workers a quarter of what Chinese manufacturers pay.21 To this end, efforts to reduce dependency on Chinese labor are complemented by the fact that suppliers elsewhere are hastening to offer even cheaper and quicker production than China.
Officials in these labor-abundant countries regularly disregard issues in their garment industry, fearful that increased regulation will raise prices and drive fast fashion companies to produce elsewhere.22 In India, where garment exports bring in billions of dollars annually, researchers found that pro-worker regulations in the garment industry hurt exporting firms more than non-exporting firms, generating a loss to welfare.23 Along these lines, domestic efforts to improve labor conditions in the Bangladeshi garment industry since the collapse of a complex housing five garment factories in 2013 have had minimal effect. Workplace safety has improved in some factories, but garment workers still lack adequate bargaining power and basic labor institutions.24 Construction of this complex forwent several safety clearances and permits because of secret arrangements between the factory owners and the local mayor.25
The globalization of fast fashion supply chains has committed employers and officials in manufacturing countries to a race to the bottom to undervalue and exploit their labor force to grow their country’s textile and garment exports. Since policymakers in China, India, and other labor-abundant countries have little incentive to improve workers’ rights and environmental sustainability on their own, fast fashion companies are pivotal in encouraging transnational and multilateral regulations to combat the industry’s issues.
The Environmental Impact
This leads into one of the most significant outcomes of the industry—its environmental footprint. The fashion industry is the second largest contributor to pollution of all industries, after petroleum,26 contributing 20% of all wastewater and 8% of carbon emissions globally.27 From the earliest stages of production to transportation and retailer supply, the fast fashion industry utilizes approximately 93 billion cubic meters of water annually.28 Some of the key processes responsible for wastewater production include agriculture involved in textile cultivation, animal breeding, cleaning manufacturing machines, treatments for the materials, and the laundering processes.29 Ultimately, the amount of energy expended in the production of clothing throughout the world has, and continues, to rise, implicating the sustained environmental consequences of the industry in the coming years.
Recycle, Reuse, Reduce: A Transitional Approach
While the gravity of fast fashion’s environmental impact is immense, there are still areas of promise that emerge as key offsets to the industry’s footprint. Bailey, Sharma, and Basu (2022) emphasize an approach to recycling water effluents as a means of reducing aggregate water consumption, noting that plenty of textile factories have yet to establish plants for wastewater treatment. Another solution they discuss is recycling or reusing textiles, which would therefore limit, in part, the production of virgin textile fibers. As polyester and other synthetic fabrics are energy-intensive and rely heavily on crude oil, eco-material production––involving the recycling and reuse of older textiles––is a viable alternative. While it should be noted that some eco-materials, organic cotton, for example, are not in high enough supply to meet global demand. Genetically modifying fibers has the potential to increase yield while adverting the extent of environmental damage associated with its synthetic counterparts.30
Furthermore, the reuse of apparel––transferring the ownership of unsold apparel from large retailers to second-hand markets, or rental markets––could curtail some of the industry’s environmental impact, wherein fewer new fibers would need to be produced. Bailey, Sharma, and Basu (2022) recommends a larger social shift from a linear economy, in which production focuses on a systematic procession of sourcing, manufacturing, and disposal, to a more circular model.31 Ultimately, this would require consumer choices to lean increasingly towards second-hand clothing to optimize the reuse of existing resources over the mass-production and shortened shelf-life of new materials.
The significance of changes in consumer behavior as a means of gradually reducing the environmental repercussions of the fashion industry cannot be understated. Generating awareness and support for environmental justice is a critical aim because consumer mobilization illuminates the collective impact consumers can have. If consumers can extend the lives of their garments by nine months, researchers project it would result in a 22% waste reduction and 33% water savings.32 Growing awareness of the adverse effects of fast fashion has arguably contributed to the mainstream growth of the second-hand fashion industry. While the effects of this positive social shift have been counteracted by the air of hyper-consumerism in many countries today, that the second-hand market still has seen increasing popularity warrants some optimism.
Government Regulation: An Avenue for Oversight
As for the responsibility of fashion companies, and governmental regulations on the industry, inquiry persists as to what has been and what needs to be done to mitigate or at least reduce their environmental impact. Increasingly, sustainable manufacturing has become integrated into the fast fashion industry’s agenda, and it is perhaps long overdue, as it has been largely pushed in light of the hazardous conditions in garment factories. Notably, following the 2012 garment factory fire in Dhaka, Bangladesh, in which over 1,100 employees were killed, the dire conditions and lack of safety precautions within these factories were further brought to light.33 Evidently, the necessity of a shift to sustainable manufacturing, which would enforce policies aimed at protecting human rights and promoting environmental preservation, is clear.
Alternative methods and policies for sourcing apparel production are also gaining relevance within the discourse on a more sustainable fashion industry. For one, Abdulgadir brings to light the prospect of apparel manufacturing through 3D printing, which has already emerged through the use of computer-aided design (CAD). While still in its relative infancy, the process of prototyping and producing 3D-printed clothing items relies on Selective Laser Sintering (SLS).34 The potential growth of 3D printing, in the fashion realm, poses a key advantage in that it does not require the amount of chemically harmful steps involved in traditional apparel manufacturing. Another option on the table––which would require a transitional policy approach––is reshoring apparel manufacturing, which would effectively reduce waste production and emissions associated with transportation. Overall, while these strategies have received minimal employment as of yet, they are potentially viable options for transforming fashion from how it is manufactured today into a more environmentally sustainable industry.
Going Forth: Policy Recommendations
To combat the environmental degradation directly caused by apparel manufacturing, strategies must be pursued at the aggregate level. As a prototype for emerging policies, the Sustainability and Social Accountability Act (S7428/ A8352), introduced in the state of New York in 2022, has emerged showing significant promise. Colloquially referred to as the ‘New York Fast Fashion Act,’ the policy has set out strong requirements for fashion retailers in terms of mapping out their supply chains and providing transparent documentation on the environmental impacts of their manufacturing process.35 According to the National Law Review, the act specifically targets businesses on the condition that they are stationed or active in New York state and their total global revenue exceeds $100 million (USD). Under the legislation, apparel manufacturers are required to disclose the location of 50% of their suppliers for review.36 The environmental and ethical risk associated with their supply chain is evaluated by US Customs and Border Protection withhold release orders (WROs) or Findings, wherein areas that are deemed high risk based on forced labor practices, for example, may be flagged.37
Ultimately, the New York State Fast Fashion Act will need to be one among several legislative policies introduced in the United States and abroad to mitigate what has effectively been an unregulated market for large-scale apparel suppliers. Growing public awareness of the fashion industry’s deleterious labor and environmental practices is largely what propelled the Fashion Act forward. While the Act signals a critical turning point in the regulation of environmental damage caused by the fashion industry, and presents a potential to proliferate this model to other state legislatures, it is certainly not a ‘one-and-done’ policy. The globalization of the apparel industry means that every state involved in the manufacturing, textile production, trade, and supply of fast fashion has a responsibility to assume stricter regulations on the business and operational practices of these firms.
Final Remarks
As of now, the future of the fast fashion industry is uncertain. At one level, apparel consumption does not show remarkable signs of slowing down, as the convenience of online shopping continues to gain traction and the demand for the newest styles remains steadfast. Taken together, this means that an industry contributing ten percent of total carbon dioxide emissions globally is still on the rise.38 As such, the need for active policy reform aimed at regulating fashion supply chains and their operational practices has become increasingly critical. Fast fashion companies and policymakers in the countries housing these companies must take responsibility for the negative consequences of their global supply chains. Both the private and the public sector need to lead initiatives to improve human rights in textile and garment manufacturing in developing economies.
At this point, fast fashion’s carbon footprint is no secret, though the lack of global governance and oversight mechanisms for business operations of major corporations have meant little in the way of direct legal or monetary consequences for environmental degradation. Going forth, governmental regulation on the business practices of large-scale apparel manufacturing must become more restrictive if any attempts at mitigating current rates of pollution are to be achieved. For the sake of environmental concerns and the ethical integrity of the industry, all people have a vested interest in where apparel comes from, where it goes, and how it is sourced. As Saturday Night Live bluntly puts it: the most fundamental thing we can do is stop buying fast fashion.39 Ultimately, this means wearing what we have, making it last, and consuming less, to end this cycle at its source.
Works Cited
[1] Abdulgadir, Adil, and Imad Abdulgadir. 2020. “Strategic Proposals for Sustainable Supply Chains in the Fast Fashion Industry: Exploring ways to incorporate concepts and methods to confront the damaging effects of the industry.” Master of Science Thesis, Department of Industrial Economics and Management, KTH Royal Institute of Technology, Stockholm.
[2] Farahani, Reza Zanjirani, Nasrin Asgari, and Luk N. Van Wassenhove. 2022. “Fast Fashion, Charities, and the Circular Economy: Challenges for Operations Management.” Production and Operations Management 31 (3): 1089–1114. https://doi.org/10.1111/poms.13596.
[3] Taplin, Ian Malcolm. 2014. “Global Commodity Chains and Fast Fashion: How the Apparel Industry Continues to Re-Invent Itself.” Competition & Change 18 (3): 246-264. https://doi.org/10.1179/1024529414Z.00000000059.
[4] Statista. 2023. Fast fashion market value forecast worldwide from 2021 to 2027. 4 December. Accessed April 8, 2024. https://www.statista.com/statistics/1008241/fast-fashion-market-value-forecast-worldwide.
[5] Ibid.
[6] Cachon, Gérard P, and Robert Swinney. 2011. “The Value of Fast Fashion: Quick Response, Enhanced Design, and Strategic Consumer Behavior.” Management Science 57 (4): 778–795. https://www.jstor.org/stable/25835736.
[7] Taplin. 2014. Global Commodity Chains and Fast Fashion: How the Apparel Industry Continues to Re-Invent Itself.
[8] Taplin, Ian Malcolm. 2014. “Who is to blame?: A re-examination of fast fashion after the 2013 factory disaster in Bangladesh.” Critical Perspectives on International Business 10 (1): 72-83. https://doi.org/10.1108/cpoib-09-2013-0035.
[9] Sun, Xuantong, Xi Wang, Fengqiang Sun, Mingwei Tian, Lijun Qu, Patsy Perry, Huw Owens, and Xuqing Liu. 2021. “Textile Waste Fiber Regeneration via a Green Chemistry Approach: A Molecular Strategy for Sustainable Fashion.” Advanced Materials 33 (48): 1-9. https://doi.org/10.1002/adma.202105174
[10] Sun, Xuantong, Xi Wang, Fengqiang Sun, Mingwei Tian, Lijun Qu, Patsy Perry, Huw Owens, and Xuqing Liu. 2021.
[11] Ibid.
[12] Munslow, Barry, and Tim O’Dempsey. 2011. “Globalisation and Climate Change in Asia: the urban health impact.” Third World Quarterly 31 (8): 1339-1356. https://doi.org/10.1080/01436597.2010.541082.
[13] Plumer, Brad. 2018. You’ve Heard of Outsourced Jobs, but Outsourced Pollution? It’s Real, and Tough to Tally Up. 4 September. Accessed April 10, 2024. https://www.nytimes.com/2018/09/04/climate/outsourcing-carbon-emissions.html.
[14] Trade Partnership Worldwide, LLC. 2023. “Impacts of Section 301 Tariffs on Imports from China: Case Studies of Apparel, Footwear, Travel Goods and Furniture.” Accessed May 14, 2024. https://tradepartnership.com/wp-content/uploads/2023/01/China-301-Tariff-Costs-Joint-Association-Study-FINAL.pdf.
[15] Cox, Chelsey. 2023. Retailers Shein and Temu violate U.S. tariff law and evade human rights reviews on imports, House report says. 22 June. Accessed May 14, 2024. https://www.cnbc.com/2023/06/22/shein-temu-evade-us-tariff-and-human-rights-law-on-imports-house-report.html.
[16] Trade Partnership Worldwide, LLC. 2023.
[17] Cox. 2023.
[18] Ibid.
[19] Ibid.
[20] Trade Partnership Worldwide, LLC. 2023.
[21] Taplin. 2014. Who is to blame?: A re-examination of fast fashion after the 2013 factory disaster in Bangladesh.
[22] Ibid.
[23] Hasan, Rana, Aashish Mehta, and Asha Sundaram. 2021. “The effects of labor regulation on firms and exports: Evidence from Indian apparel manufacturing.” Journal of Comparative Economics 49 (1): 183-200. https://doi.org/10.1016/j.jce.2020.04.007.
[24] Rahim, Mia Mahmudur, and Sk Samidul Islam. 2020. “Freedom of association in the Bangladeshi garment industry: A policy schizophrenia in labour regulation.” International Labour Review 159 (3): 423-446. https://doi.org/10.1111/ilr.12152.
[25] Taplin. 2014. Who is to blame?: A re-examination of fast fashion after the 2013 factory disaster in Bangladesh.
[26] Abdulgadir and Abdulgadir. 2020.
[27] Bailey, Kerrice, Aman Basu, and Sapna Sharma. 2022. “The Environmental Impacts of Fast Fashion on Water Quality: A Systematic Review.” Water 14 (1073): 1-11. https://doi.org/10.3390/w14071073.
[28] Ibid.
[29] Ibid.
[30] Abdulgadir and Abdulgadir. 2020.
[31] Bailey, Basu and Sharma. 2022.
[32] Ibid.
[33] Abdulgadir and Abdulgadir. 2020.
[34] Abdulgadir and Abdulgadir. 2020.
[35] Lupo, Anthony V, Eva J Pulliam, Angela M Santos, and Dan Jasnow. 2023. New York State Fashion Act Would Put Fashion Industry Under the Spotlight. 17 July. Accessed April 27, 2024. https://natlawreview.com/article/new-york-state-fashion-act-would-put-fashion-industry-under-spotlight.
[36] Ibid.
[37] Ibid.
[38] Center for Biological Diversity. n.d. At What Cost? Unraveling the Harms of the Fast Fashion Industry. Accessed April 28, 2024. https://www.biologicaldiversity.org/programs/population_and_sustainability/sustainability/fast_fashion.
[39] Saturday Night Live. 2024. “Fast Fashion Ad.” 19 May. Accessed May 20, 2024. https://youtu.be/mFNFmnYio90?si=NB3uKt8VG25FB0WD.
Author Bios
Haley Dymek brings a wealth of experience and dedication to her academic pursuits. At university, the concept of soft power resonated deeply with Haley, particularly in countries promoting their culture abroad. Haley aims to explore the economics of soft power, investigating how a country’s pop culture influences its economy.
Noelle Puvak’s focal interests span legislative reform, politics, international relations, environmental protection, and human development. She attributes her passion for global affairs to her upbringing, having experienced diverse cultures in nine countries. She investigated the impact of policy reform on the prosecution of femicide perpetrators in Costa Rica.