Welcome back Modern Thinkers to a new edition of our "Pls fix, thx" series where we tackle a problem created by the fashion industry. Together we investigate the problem and seek for the solution, without boiling the ocean.
What's the problem?
Unsold inventory particularly in department stores, is a waste issue. When clothes are produced to meet a certain trend and or a specific body shape that lacks demand then the result is unsold inventory. Another term for this is "pre-consumer waste".
How is the problem caused?
There is actually one very clear culprit at work here: MOQ. Minimum Order Quantities (MOQs) depending on the supplier depend on the minimum amount of fabric or even finished product to be made in order to meet the production cost's budget. The lower the cost the higher the margin and for brands selling inside department stores this matters for their bottomline. To sell at a department store (AKA letting someone else do the selling) you need to budget for 60% of every sale going to the seller, not your brand.
How do we fix it?
Great question! That's what this series is about. There are a couple of things that can be done but first and foremost we must understand that this cannot be solved without systemic thinking. For example, in the past (and unfortunately still today) textiles are being burned. This process emits Co2 which contributes to global warming. Hence it does not solve the bigger problem. We want to find sustainable solutions, not just patch a bandaid to temporarily stop the bleeding.
If the MOQ is the culprit at play, then the remedy needs to solve the big gap between supply and demand.
We could start with demand and then work backwards towards the supply instead of the other way around. "Build it and they will come" is a startup mantra that I've detected in the fashion industry too when it comes to releasing new styles.
Pre-consumer waste needs to become a thing from the past.
Let's get to work.
Pls fix, thx.