With a new year underway, many wonder what the future may have in store for the fashion industry. After facing some of the most unprecedented and challenging years on record, the industry is slowly bouncing back. The pandemic may have caused significant disruptions to operations, logistics and global supply chains, but it failed to halt the leading trends shaping the future of fashion. Instead, COVID-19 had the opposite effect and accelerated several critical points forming the industry’s future, including environmental, social and digital areas. With forecasters expecting fashion sales to make a full recovery next year, we examine four leading themes that are set to shape the future of the industry in 2022.
1. Reinventing purchasing practices
As more consumers question where their products are made and under what conditions, it's evident that sustainable sourcing is vital to a company's success. However, according to McKinsey, fashion companies will likely have to increase retail prices with current supply chain challenges set to put more pressure on input costs within the following year. To minimise the impact supply chain stresses may have on margins, fashion companies need to rethink current sourcing and purchasing practices. Sustainability is likely to offer companies one of the biggest opportunities for growth in 2022, according to a BoF-McKinsey survey, indicating that any costs or challenges linked to shifting to sustainable practices are likely to be outweighed by the business benefits. Shifting to more sustainable purchasing practices, improving circularity, and responsible operations can help offset a negative impact. By changing purchasing practices such as using virtual samples, investing in more agile supply chains, fashion companies can improve their supply chain while working more transparently.
2. Responsible materials and textiles
With the imminent threat of climate change on the horizon, the need to reduce the fashion industry's environmental impact is vital. Leading fashion companies like H&M, VF Corporation and Nike are investing more in sustainable materials than ever before while continuously looking for ways to reduce textile waste and emissions. With many fashion players rolling out closed-loop-recycling systems, those who do not follow in suit risk falling behind. Implementing sustainable materials over virgin raw materials is a key focus for 2022, with manufacturers like Lenzing offering several alternatives to cotton, like TENCEL™ fibres. These wood-based cellulosic fibres are made from trees grown in sustainable-managed forests and have significantly less environmental impact compared with synthetic fibres. In addition, due to the cellulosic nature of the fibres, the final fabrics also have the potential to be biodegradable and recyclable, further reducing the impact on the environment. As demand for circular, sustainable and responsible materials increases, fashion companies need to start implementing them from the design phase up.
3. Digitalization for responsible production
As more fashion companies focus on responsible and circular production, digitalisation is another key theme emerging in 2022. Brands and retailers alike will invest in sustainable technologies that offer more insights than ever before into their production processes, materials, and logistics. Technological advancements, like blockchain, will only speed up this shift and offer companies even further insights into products. This information can enhance supply chain transparency visibility and add value to processes. Lenzing, for example, leveraged blockchain to develop a supply chain transparency platform that guarantees the authenticity of its TENCEL™ or LENZING™ ECOVERO™ branded fibres for all partners. This year, digital systems that help fashion companies address their weak points while helping improve business practices and share information easily will become a must-have.
4. Cross-collaborations across the value chain
Over the next year, the industry's focus on sustainability, digitalisation and social justice will see more collaboration crossovers with supply chain players. It’s likely brands, retailers, and manufacturers will increase partnership efforts to bring about systemic change. Over the next year, these collaborations will only grow in size, like the UN Alliance for Sustainable Fashion, the Sustainable Apparel Coalition and the Global Fashion Agenda. Several fashion companies and brands have also launched their own initiatives, working together or with others to shine a light on impending environmental and social issues. The TENCEL™ brand, for instance, has focused on directly working with leading retailers such as Fila, Levi's and Guess to help increase awareness among consumers on living sustainably. In order to thrive and not just survive in 2022, fashion companies have to make sure they are operating in the interests of all stakeholders - including employees, customers, investors, management board and more.