PESTEL Analysis of the Fast Fashion Sector
What Is Fast Fashion?
Fast fashion is a latest business model in the clothing industry that focuses on quickly producing trendy, affordable apparel. Brands design, manufacture, and distribute new styles rapidly, helping consumers to update their wardrobes with the latest trends frequently. This model emphasizes speed and cost-efficiency. Most of the time leading to lower-quality garments that are intended to last only a short time.
The Impact of Fast Fashion
While fast fashion makes trendy clothing accessible and affordable, it comes with significant drawbacks:
- Environmental Impact: The rapid production cycle and emphasis on low-cost materials contribute to pollution, waste, and high carbon emissions.
- Labor Issues: To keep prices low, many brands outsource their production from countries with limited labor laws, often resulting in poor working conditions and low worker wages.
- Consumer Culture: Fast fashion promotes a throwaway culture. People don’t use clothes after a few uses thus they are increasing textile waste.
Understanding these impacts encourages more sustainable fashion choices.Thar are like buying higher-quality, longer-lasting items or supporting brands that prioritize ethical practices.
Temu, Shein, Cider, Boohoo, Pretty Little Things: these brands do not have a high street presence. They sell their collections at low prices. What are their environmental factors?
PESTEL Analysis of the Fast Fashion
Fast fashion is a branch of the ready-to-wear sector that stands out for its exceptionally high production rate. The major fast fashion brands (Zara, H&M, Uniqlo, Mango, etc.) renew their collections by offering new products several times a year. Even several times a month or week. They are so-called ultra fast fashion brands (Temu, Shein, Cider, Boohoo, Pretty Little Things). We also talk about “fast fashion” or even “disposable fashion”. The clothes available at low prices and are of low quality.
They are intended to be worn only a few times or even for a single occasion. Fast fashion brands encourage consumers to renew their wardrobe constantly. In the case of Shein, an average of 7,200 new references are added each day to the brand’s website (900 times more than a traditional brand).
Political
The fast fashion sector depends on the legislation of the countries where the clothes are available for sales. Which is linked to each country’s commercial and environmental policy. Indeed, some countries, such as France, may decide to consider restrictions to try to reduce these products’ ecological impact or promote products manufactured more locally and ethically.
A European complaint against the Chinese e-commerce site Temu was filed in May 2024, claiming non-compliance with the Digital Services Act (DSA) about traceability, manipulation, non-transparent algorithm.
Fast Fashion and CSR (Corporate Social Responsibility)
What are the challenges and success factors in implementing a responsible purchasing approach within a new generation of ready-to-wear (slow fashion vs. fast fashion)?
Economical
The fast fashion sector has considerable economic weight. According to an ADEME study, more than 100 billion items of clothing are avaialble for sale worldwide each year. The clothing from fast fashion brands dominates this production. In addition, a study by the Boston Consulting Group reveals that the value of the fast fashion market will reach to increase from 200 billion euros in 2022 to more than 250 billion euros by 2028. It will represente an annual growth of around 3.8% over the period.
In France, the fast fashion sector represented around 3 billion euros in 2022, or around 10% of the ready-to-wear sector’s revenues. More specifically, the Shein, Amazon and Temu brands represent more than 50% of ultra fast fashion sales in France in 2022.
These are products characterized by a high price elasticity of demand.
Sector heavily impacted by the health crisis linked to COVID-19 and by supply chain bottlenecks
The price structure is very sensitive to variations in raw material prices.
Sociocultural
Overall, consumers are increasingly aware of the ethical and environmental issues. It is raised by the fast fashion sector and are increasingly sensitized to sustainable development challenges. This trend could threaten fast fashion if more and more consumers turn away from it in favor of more ethical alternatives (which are increasingly accessible and varied). The fast fashion sector and its problems have been widely in discussions to the point of becoming one of the emblems of overconsumption in our time.
However, the appeal of consumers to the fast fashion sector remains undeniable. From May 4 to 8, 2023, the Shein pop-up store in Paris had a great success. The store had extremely high attendance. ayou can explain it by the many injunctions to consume, particularly by social networks through advertisements and sponsored content. Fast fashion brands also manage to attract consumers thanks to their extremely low and unbeatable prices. They are particularly attractive in the current context by global inflation.
Technological
Technological advances and innovations in textile manufacturing processes have greatly encouraged the fast fashion sector. Indeed, certain advances such as automation have made it possible to reduce production costs and accelerate production cycles, which is a key element for fast fashion companies whose objective is to offer new products as often as possible, with the lowest possible production cost. On the other hand, the rise of online commerce has favored the fast fashion sector since these brands essentially have online sales platforms. Doing without physical stores makes it possible to offer ever shorter production and marketing cycles and a virtually unlimited selection of products.
Environmental
The ecological impact of fast fashion is controversial, and it is one of the most significant weaknesses of this model. Indeed, according to ADEME, all the clothing sold each year in the world (more than 100 billion items) produces 4 billion tons of CO2 per year. The clothing industry alone is responsible for 10% of greenhouse gas emissions in one year.
The figures related to the pollution represented by the textile industry are extremely telling:
85% of textiles produced in the world end up in the garbage during same year;
In Europe alone, clothing waste has reached at 4 million tons per year;
The volume of water needed to produce a pair of jeans is 7,500 liters. Remember to note this is the equivalent of the water drunk by a single human during 7 years;
The production of clothing textiles is responsible for 20% of water pollution in the world;
Legal
Several countries are trying to implement legislation that could hinder the fast fashion sector. Thus, since March 4, 2024, France has been studying a proposed law that aims to penalize fast fashion, in particular by penalizing the products concerned and banning advertising for online sales platforms for low-cost clothing.
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