Something is happening in the fashion market: well-known brands are disappearing and new ones are entering the market. Sustainability is playing an increasing role – production needs are greater in Europe.
Frankfurt’s Zeil is one of Germany’s highest turnover shopping streets – it changes face every day: many well-known brands and fashion retailers are insolvent, some are closing stores or at least laying off staff: Galeria Karstadt Kaufhof, Esprit, Peek & Cloppenburg, Görtz, Reno, and finally Hallhuber. Companies active primarily in the mid-price segment have been hit hard.
The story is different at low and high price points: discount brands are inflation winners, while customers of luxury brands are shrugging off current price increases.
“Brands have to represent a certain lifestyle, appeal to a certain group and raise their profile accordingly,” says Achim Berg, a fashion industry expert at management consultancy McKinsey & Company. “You can only survive if you constantly reinvent yourself and don’t neglect your customers.” In principle, fashion is becoming faster and faster, but at the same time, the need for sustainability is also increasing.
Interest in sustainable fashion is growing
The fashion industry is currently responsible for around ten percent of global greenhouse gas emissions. At the same time, more and more people are interested in sustainable fashion.
In a study, the environmental organization Greenpeace confirms that people are becoming more conscious of adopting more sustainable fashion: In 2015, an average German adult had 95 items in their wardrobe; Only 87 pieces. Germany loses 340 million pieces of clothing every year.
Production returns to Europe
The European Commission also intends to make textiles more durable and recyclable by 2030. Production conditions are more targeted. According to an industry analysis by McKinsey, more than half of fashion industry leaders want production to be more localized and controlled.
Besides Poland and Romania, Portugal’s textile industry is currently popular, also because the country has invested heavily in this field, Berg said. “In addition, there are well-trained professionals and a low minimum wage of 887 euros per month.”
Portugal’s Textile Industry Booms
Business is booming around the Portuguese city of Porto. The industry offers its own research and innovation center here. Existing recipes for success: sustainability, recycling of waste or residues.
An example is fabric manufacturer Valerius 360. The company’s business model: Valerius receives 7 tons of surplus fabric per day from local textile companies. What used to be thrown in the trash is here shredded and processed into new yarn. “We hardly have any cotton production in Europe. We have to get everything from other countries. In this production we can make yarn from recycled fabric, so we are less dependent,” says manager Ana Tavares.
Is fashion simply not sustainable?
One of the most famous German sustainable fashion brands that has partnered with Valerius is Armedangels. Kataya Kruk is responsible for Sustainability Strategy. Of all people, she says sustainability and fashion are mutually exclusive: “Every piece of clothing that goes into the closet is an extra burden on the environment. It’s important to make clothes responsibly, but so is how much we consume .”
So less is more: the Cologne-based company has been producing fashion for 13 years. Four series are launched each year. This clearly differentiates Armedangels from so-called fast fashion companies, which put out as many as 24 collections a year.
“Fast fashion” also wants to go to Europe
But many “fast fashion” brands also plan to bring some of their products back to Europe. Even if not primarily for sustainability reasons. “Brands can get new collections to stores faster and save on shipping and storage costs,” says industry expert Achim Berg. It’s impossible if you produce in Southeast Asia or China.
Sustainability and proximity to Central European sales markets: these two trends allow Portugal’s textile industry to flourish. The boom is likely to continue — and even get bigger. Many of Germany’s insolvent clothing chains are looking for new strategies. One, of course, is sustainable fashion – but at the lowest possible price point.