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How did it all start?

It all started because, in the last decade, some people felt that enough is enough!
The emergence of fast fashion was driving the world crazy and everyone was buying way too many clothes, wearing them far too little. Part of the awakening came from the Rana Plaza incident where the garment factory in Bangladesh collapsed in 2013.
Since then, the fashion industry has seen a lot of criticism and has been urged to innovate and change. In 2018, an article from BBC described the movement of fashion brands to disconnect themselves from fast fashion.
This chart from Ellen MacArthur Foundation is an excellent illustration of how bad the problem was half a decade ago.

A new era for fashion - Successful business models

The Reformation of Rebuild & Renew

The possibility to recycle and donate clothes over the years had flooded collection stations with clothes that no one was giving a second chance to because they were no longer trendy, nor were they functional enough to donate.
Reformation found an excellent business model where they made their one-of-a-kind unique pieces from collected used clothing, excess fabric from designer factories, and sustainable materials.
The business model steered away from massive material purchasing that required planning and a design process that takes 12 months to go to market. Designs were made according to trend and material available, and for sale in a month. As a result, every piece was by nature, a limited edition.

Reselling: Consignment

The concept was nothing new, but the innovation came in how these business models were enhanced and marketed to consumers. In the mid-2010s, “thrifting” started to become trendy, and “totally cool” to dress vintage.
The French consignment store Vestiaire Collective is probably one of the best success stories. They turned the typical luxury consignment store with authentication services into an e-commerce model by overcoming several logistical challenges and created a modern app-based platform that made bidding and negotiation much easier.
Apart from the convenience, they marketed the brand as fashion-forward and trustworthy setting themselves apart from other online platforms such as e-bay.
Some business models took clothing resale to another level. For example, ThredUP. Apart from selling directly to consumers, established a B2B line of business offering their resale technology infrastructure as a platform solution to brands that are looking at collecting old garments for store credits, and more.

Slow Fashion: Longevity, Luxury & Quality

Another category that emerged were brands that offered goods with a focus on premium material and quality, as a result offering a luxurious consumer product with longevity.
These brands had a clear mission to go against fast fashion. The likes of CuyanaNadaamThe Curated amongst others, fulfilled the demands of sustainably sourced premium materials such as Cashmere and Silk, to create timeless and basic pieces for every woman’s closet; they advocated for the longevity of their goods and with his, came the rise of slow fashion.
L’EnversL&EArmadillo Stores are three of our Stellar members creating timeless and sustainable sourced pieces and we are so proud to see their contribution towards a more circular fashion industry!

Rentals & the Subscription Model

Finally, some of the most innovative and experimental business models in fashion come from the rental idea, which is an unusual triumph. In the past consumers were not ready for renting garments.

Rent the Runway targeted consumers that were not only trend-sensitive, but also needed quality for the occasion. They provided options for women to rent designer pieces for important events including suits for interviews, gowns for attending galas and events. This opened up a market for women that wanted to dress well without heavily investing in pieces for every kind of infrequent occasion.
What has ultimately appeared as a classical case study in sustainability courses is the founding of MUD Jeans, which proved that the subscription model could work even in the fashion industry, and for something as common as a good old pair of organic cotton jeans! The consumers pay a monthly fee to lease a pair of jeans for 12 months and can decide to keep it for good, swap it for a new pair or recycle them after 12 months.

Closing Notes: Creativity and Innovation

Fashion used to be mainly about the trend, the design. Some would argue that the quality was important, too. But for the mainstream consumer and for a good couple of decades, it was far from being about the craftmanship or quality.

Consumer expectations and mindsets are now shifting, with better acceptance to the sharing economy and circularity. They are no longer looking for quick and cheap. Longevity is becoming a higher priority when it comes to economical benefits of the items they buy and consume.

What we are finding now is that even for fashion brands, retailers, the innovation in the business model could be their winning factor.

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