Today only 20 companies dominate the world's fashion industry and account for 97% of global economic profit in the sector as well as for waste and pollution. So, all independent designers you know share only 3% of all profits worldwide. Is it possible to change?
While small and medium enterprises (SMEs) may not generate as much revenue individually as a large corporation, they are still vital to the success of the economy. Many small businesses operate locally, their hiring of local people creating a huge impact not only on the local economy but on the overall wealth of a community and its people. One study says that for every $100 a person spends at a local business, $68 will stay in the community, compared to only $43 of every $100 spent at a chain store. While the large scale companies are increasing the inequities of income and concentration of wealth, SMEs are helping to widespread equal distribution of income and wealth.
Moreover, small and medium-sized companies just can not afford overproduction. Why is this important? Let's look at the numbers:
- 30% of all clothing will never be sold or worn, and eventually will end up in a landfill.
- More than 5% of the waste in landfills is textiles. 12.8 mil. tons of waste is sent to landfills annually.
- $52 bn. loss by 2030. Fashion brands would see a profit reduction because of scarce resources and overproduction.
Let's not talk about the fast fashion culture and the throwaway attitude of consumers, let's talk about the business side. In a highly competitive environment, SMEs simply can't afford one-third of unsold items, because it's a death sentence for a small brand. Smaller enterprises and independent designers cannot, and do not mass produce their collections, and often produce on-demand thus avoiding overproduction.
Buying a mass-produced item, you have little knowledge or connection to the other end making it. The anonymity hides a twisted web of international factories and supply chains. In fact, 97% of all clothing is produced overseas where fashion industry conglomerates exploit cheap labour in developing countries where eco-standards are low. Small brands or independent designers on the other hand often rely on smaller cooperatives or factories to produce their collections consequently making a contribution to the local economy.
It's hard to believe, however, empowering SMEs today will lead us to a better quality of clothing, a bloom of truly unique designs and techniques, a healthier local economy, waste reduction, and effective pollution management tomorrow.