Stylish and Sustainable: Can Zara’s Fast-Fashions be Both?
How retailer Zara is working to offset the environmental impact of its popular and affordable fast-fashion designs.
Fast-fashion giant Zara, and its parent company Inditex, have taken a proactive initial stance on the issue of sustainability and climate change. The Zara brand has acknowledged its role, as a retailer, in promoting the drivers of climate change, and has begun pushing for enhanced sustainability in its operational strategy to mitigate this damage, both to the environment and its brand.
Retailers in the fast-fashion space produce stylish and deliberately ephemeral designs at accessible price-points. The fast-fashion trend has exploded in the past ten years, via a combination of ever-decreasing costs of production and cheaper material sourcing. The plethora of inexpensive designs produced by brands like Zara and competitors H&M and Forever21 allow consumers, particularly younger females, to impulsively purchase new clothing as often as weekly [x]. Production of disposable fashion on such a vast scale has historically been characterized by the importance of speed, affordability and newness rather than environmental responsibility [x]. Globally, the broader apparel industry drives around 10% of carbon emissions; it’s also the second highest industrial polluter [ix]. Fast fashion, specifically, drives a disproportionate share of this impact, both due to scale of volume and product life cycle. Fast fashions, held on average for 35 days, are worn fewer than five times during their product lifetime. As such, each fast-fashion garment generates 400% more carbon emissions per year than a regular article of clothing, typically retained and worn for ten times as long [ix].
To address fast fashion’s significant environmental footprint Inditex and Zara have taken action. Their current strategy involves the following key avenues of sustainability: products, suppliers, and environmental impact [vii]. From using certified organic cotton in certain collections and leveraging recycled materials in others, conducting agricultural education on sustainable ecological farming techniques, to collaborating on specialized seed bank development, Inditex has begun to consider how the raw materials funneled into its products can promote environmental consciousness [v]. In 2014, Inditex brought 34 million articles containing 100% organic cotton to market, and through the Better Cotton Initiative, helped to train growers on methods that use less water and fewer pesticides [v]. The company also advocates for sustainable forest management related to the production of synthetic materials such as viscose or modal, used heavily in manufacturing its products [v]. Within its extensive supply chain, Inditex partners with 1,725 suppliers and 6,298 factories in over 50 countries; each one is held to the same stringent standards of environmental responsibility by the company [vi].
Source: https://www.inditex.com/en/sustainability
From an impact perspective, Inditex considers key environmental indicators to gauge performance on the sustainability front, and has taken critical steps to improve the eco-efficiency of its stores and to minimize the impact of its manufacturing program [ii]. Inditex has developed a strategic water management framework, for both manufacturing and in-store activities, including a pledge to get to a discharge of zero “undesired chemical substances” within the next four years [iv]. Similarly, by 2020 Inditex has pledged to reduce the amount of energy consumed by its aggregate operations by 15%, and to reduce energy use in its brick-and-mortar retail locations by 10% [iii]. Already, the company has rolled out an eco-efficient store concept that relies on innovative techniques to use fewer resources. Store lighting is dimmed by 80% until motion detectors sense customers’ presence, speed-controlled escalators automatically increase their pace when customers board, and HVAC systems adjust temperatures dynamically based on current store occupancy and relative prevalence of sunlight in different locations [i]. Plastic shopping bags are oxo-biodegradeable, security sensors and plastic hangers are re-used whenever possible, and cardboard boxes for clothing deliveries are shipped up to six times, back-and-forth within the company, before they are finally recycled [i].
Source: https://www.inditex.com/en/sustainability
Each Inditex distribution center is designed and managed with sustainability in mind. Every center has “ISO 14001 certified environmental management systems” and employees undergo mandated environmental education and training [viii]. Any incremental centers built by Inditex are designed to meet the standards of the US Green Building Council’s “LEED Gold” certification, and the company has been retroactively updating existing centers via the addition of energy-efficient lighting, insulation and more advanced climate control systems [viii]. To get from point A to B within these large centers, employees ride bicycles around the floor [viii].
Source: https://www.inditex.com/en/sustainability
While Zara and Inditex’s initial efforts to mitigate the harmful effects of fast fashion on the environment are a positive step, I remain skeptical that these actions meaningfully offset the detrimental impact of their overall business model. I hope to see the company’s sustainability strategy, particularly as it relates to supply chain and raw materials, evolve over time to a more transparent and quantifiable state. If the company declared use of sustainably sourced fabrics and raw materials across all fashion campaigns rather than just select collections, such decisive action would demonstrate true commitment to working to prevent further climate change.
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Sources
i. Inditex, “Eco-Efficient Stores,” https://www.inditex.com/en/sustainability/environment/ecoefficient_stores#panel_3, accessed November 2016.
ii. Inditex, “Environmental Management,” https://www.inditex.com/en/sustainability/environment, accessed November 2016.
iii. Inditex, “Global Energy Strategy,” https://www.inditex.com/en/sustainability/environment/energy, accessed November 2016.
iv. Inditex, “Global Water Management Strategy,” https://www.inditex.com/en/sustainability/environment/water, accessed November 2016.
v. Inditex, “Raw Materials,” https://www.inditex.com/en/sustainability/product/raw_materials, accessed November 2016.
vi. Inditex, “Suppliers,” https://www.inditex.com/en/sustainability/suppliers, accessed November 2016
vii. Inditex, “Sustainability,” https://www.inditex.com/en/sustainability, accessed November 2016.
viii. Inditex, “Sustainable Logistics,” https://www.inditex.com/en/sustainability/environment/logistics, accessed November 2016.
xi. James Conca, “Making Climate Change Fashionable – The Garment Industry Takes on Global Warming,” Forbes, December 3, 2015, [http://www.forbes.com/sites/jamesconca/2015/12/03/making-climate-change-fashionable-the-garment-industry-takes-on-global-warming/#7da2d15c778a], accessed November 3, 2016.
x. McNeill, L. & Moore, R. 2015, “Sustainable fashion consumption and the fast fashion conundrum: fashionable consumers and attitudes to sustainability in clothing choice”, International Journal of Consumer Studies, 39, no. 3, pp. 212-222.
Thanks for your post! This is such an interesting example to think about, since, as you so clearly laid out, so many aspects of Inditex/Zara’s business model run directly counter to sustainable practices. It reminded me of our class discussion about IKEA–what stance should a company take on sustainability when its very design encourages consumers to discard and repurchase products frequently rather than hold them for a long period of time? I wonder if the mix of “self,” “social,” and “sacrifice” consumers identified in the McNeill and Moore article will shift over time. But to what extent should Inditex respond to shifting consumer preferences, and to what extent should it actually try to drive them?
The changes Inditex has made so far to make its stores and distribution centers more efficient are great, and provide the company with economic benefit in addition to the public good of more sustainable production. But I agree with your skepticism that Inditex will actually be willing to make changes that affect some of its current core value proposition. Do you think that by now, Zara has a powerful enough role in the market to actually shift consumer behavior to emphasize “sacrifice” over “self”? If they use their reputation and global reach to do this, this could be a major contribution to the global fight against climate change.
Great post! Fast fashion has definitely come under a lot of scrutiny over the past several years for its sustainability practices. Two questions came to mind as I read through your post: (1) What else is Zara cutting back on in order to invest in its sustainable initiatives and keep prices so low? I wonder if they have made equal investment into their labor rights management programs. (2) How are they monitoring that many factories and suppliers! I believe that one of the key issues in monitoring factories for compliance is that they often subcontract to other, often non-compliant, factories. Do you think that like IKEA, Zara should consider vertically integrating to maintain the integrity of its sustainability initiatives?
Caroline, this is a great article. You rightly pointed out that the business model of fast fashion directly leads to climate change. So is it enough for a company like Zara to just focus on optimizing internal operations, raw material acquisition, and retail operations to compensate for all the climate change the companies business model leads to? Is the reduction of GHG through the above internal steps more than what the wastage fast fashion leads to? Increased quantity of clothes that need to be recycled, increased consumer and company related transport emissions while supplying and purchasing clothes (due to increased frequency of supply and consumption) – all of this doesn’t add up.
The question I wish Zara answered more clearly is that how can their business model evolve to decrease its contribution to climate change activities – can consumers recycle their clothes back at a Zara store? Can Zara invest in recycling? Can the business model go hand-in hand with sustainability initiatives?
This was a very interesting read! I knew that the apparel industry had a huge carbon footprint, but it is interesting to see how fast fashion contributes even more significantly to the footprint, especially since fast fashion clothing articles are held on average for 35 days and worn fewer than five times during their product lifetime. While Zara seems to be considering several alternatives to reducing its footprint, one thing that I am wondering is if Zara can institute some sort of recycling program with customers to take back the end of life cycle clothing that remains after five wears. Zara could reuse the material to sell recycled t-shirts for example or even partner with other organizations who can leverage the recycled materials for other products. Nike does something similar with its tennis shoes, so I think Zara could certainly take some lessons from this giant who has found a way to re-purpose its customers worn shoes! This would also help Zara’s image in the eyes of its consumers who are becoming more educated on the impact that retailers are having on the environment and upholding companies to becoming more sustainable in their practices.
Well written and researched, Caroline! I agree with some others’ sentiments that fast-fashion is a really interesting industry to focus on from the perspective of climate change–Zara in particular as I think it’s customers are a bit older and perhaps more professional than other brands you mentioned, like Forever21, and therefore might know more about climate change and care about their role in preserving our environment. I was struck by your point that “fast fashions, held on average for 35 days, are worn fewer than five times during their product lifetime. As such, each fast-fashion garment generates 400% more carbon emissions per year than a regular article of clothing, typically retained and worn for ten times as long.” This data point made me wonder what Zara could do to design more durable or classic styles, and conversely how it could educate its customers about the importance of extending a product lifetime. I also wonder how successful Zara and Inditex’s efforts have been to reduce emissions in retail stores, considering several large retailers are in leased space and might have less ability to retrofit existing outlets.
Love the article! Dido the points on comparing this to the Ikea case. I feel a strong tension between Zara’s current business model and their approach to dealing with sustainability. Fast fashion retailers have conditioned consumers to favor the right look or style over quality, which in turn leads to higher purchase frequency and more clothing that is disposed of. I think a lot of what zara has done has focused on mitigating the environmental impact of each component of the production process without actually changing the process. For example, using organic cotton as a raw material. I’d challenge them to do more on the recycling front, encourage consumers to return old clothing maybe even at theri retail locations. This would go well with your recommendation to use sustainable materials in all campaigns.
Really well-written and well-researched post, Caroline! Thank you!
I agree entirely with your skepticism on how much all of Inditex’s sustainability efforts are not truly helping to resolve the overall adverse effects their business model has on producing exorbitant carbon emissions. It would be interesting to see if they could calculate how much they are reducing fossil fuels / carbon emissions through the collective efforts of all of their sustainability initiatives. I think, though, one of the best ways they can make their business model more sustainable is through an education campaign for their consumers — since they depend on the high inventory turnover in their fast fashion model, they should consider perhaps recycling programs with incentives for shoppers (i.e., bring back your clothes and get a 5% or 10% discount on your next purchase!). It would be interesting to see if this would have traction; if so, this could be a good way for them to re-use fabrics or provide them to other retailers / manufacturers who could make use of their materials. H&M has already done this in fact — they provide $5 vouchers for every piece of clothing that is brought back! Another initiative that Zara should consider is increasing demand / marketing for its sustainable collection, perhaps through the use of celebrities. Consumers need to be more aware of the harmful effects fast fashion has and what he / she can personally do to reverse the trend, even if it is just buying more sustainable clothing.
Thanks for the post!
In general I believe in all in-store initiative since they directly impact the store P&L. From my experience of retail cost-cutting projects, utilities can be reduced up to 30%. Some of these initiatives, like store lighting, are quite easy to implement, while others, like temperature control, require involvement of real estate owners and may take longer time.
On the other hand – I don’t fully believe that they will scale organic cotton idea. Taking into account cotton prices and pace of the new styles getting to the market, i believe this initiative can significantly increase the prices. Though they can do it for some basic styles that constitute up to 25% of Zara sales.
Thanks for sharing your very interesting and skeptical view. I totally agree that many of their initiatives barely scratch the surface of the responsibility for and impact on our planet that these kinds of companies have.
An interesting topic that sparked my mind was actually how government regulation can help to push these companies towards more sustainable business practices. What could this regulation look like? More importantly, how could it be coordinated internationally? At the moment it seems that Inditex is actively hunting down favourable regulation and cheap labour environments. Can we exert more pressure from first world countries?
Furthermore, in what way will these practices eventually come back to haunt Inditex, for example through rising raw material costs? I believe that the size of the industry makes the debate extremely interesting in a way that through the shear environmental impact it has these might even be less of an externality.
Excellent post! The statistic that fast fashion clothing is worn on average less than five times is staggering — it really makes you re-evaluate whether or not fast fashion actually has the price/value proposition that it is perceived to have. It’s also very interesting that this is an environmental implication that most consumers aren’t aware of. How can consumers and regulators become so outraged by single-use paper and plastic bags when clothing has become almost single use?
I also wonder about Inditex’s motives. Are they facing regulatory pressure to become more environmentally friendly? Are they marketing their eco-friendliness in an attempt to gain consumer trust and improve their brand image? I personally haven’t seen any environmentally-oriented marketing from Inditex, so it seems plausible that it is actually a “save the world” motivation rather than profit-driven. As others have commented, though, there is certainly more that they could be doing, but it is a good start.
Excellent post. I believe this post is not only relevant to Zara / Inditex but to many in the apparel retail space.
Brands can do a lot of initiatives to lower their environmental footprint. The areas that can be heavily influenced and within Inditex control are:
1. Retail Stores
2. DC
3. Product dev
Retail Stores – investing in energy efficient lighting, high energy efficient A/C and other technologies they can decrease there overall consumption with a positive ROI.
DC – having ISO140001 is a step in the right direction. But more needs to be done. Automation and dark DC’s can really help. Most of these DC’s do not need personnel hence they can fully decrease costs by lowering there lighting. Additionally DC’s are huge warehouses with large roofs. Inditex could invest in solar roof energy in order to decrease its electricity bill and have more renewable energy sources.
Product Dev – organic cotton has taken time to take off. I am not so sure this is enough to curb its footprint but it is a step in the right direction.
One area that could be of impact is manufacturing. Investing in zero discharge water, better chemicals, and renewable energy could significantly reduce their environmental impact. In order to do this, Inditex will need to create partnerships with their manufacturers in order to drive sustainable investments.
Thanks for the post, really insightful!!!
Thanks a lot for such an insightful post!
To your final comment, I indeed think that Zara’s actions regarding sustainability are more of a communication / advertising campaign or just a way for the company to respect an all the more severe legislation than an actual change in the business model. With over 2000 stores worldwide, Zara is the pioneer of the fast fashion model. How can the company ensure that low prices – that are its value proposition – don’t come at a cost to the environment?
Great post! I agree, I think it is important that Zara and Inditex are finally addressing the role they have in climate change, but like many of the other readers, I wonder if it is too little and too late. At the end of the day, the low prices and the constant new inventory are what are driving consumers to the stores, but at the same time, as Caroline stated, these factors are also some of the main contributors harming the climate. Yet I wonder how much Inditex is truly incentivized to change their business model? It seems to me that they can address certain aspects of their business to help climate change, but at the end of the day the strengths of their business are some of the main causes of climate change.
Great post, Caroline – and very interesting for anyone concerned about the impact of our personal fashion choices on the planet. It strikes me reading your post that we spend too little time thinking about the embedded energy content of the manufactured items that we purchase. Extrapolating from analysis produced by the U.S. Department of Energy, in the U.S. manufacturing produces one fifth of all U.S. greenhouse gas emissions, despite accounting for only 12% of GDP. And that is before accounting for the energy required to warehouse and distribute these products. Sadly, most of our energy transparency efforts for consumers are focused more about the energy usage of products – take EnergyStar ratings, for example – and not about the energy that went into make the product.
To read more about greenhouse gas emissions in U.S. manufacturing: http://www.energy.gov/sites/prod/files/2013/11/f4/energy_use_and_loss_and_emissions.pdf
Great post, Caroline! I’m shocked that the apparel industry drives 10% of global emissions and assume that this will only grow as our insatiable desire for fast fashion grows which suggests that clothing manufacturers and retailers have an important part to play in reducing their emissions.
I share your scepticism about Zara’s selective practices too and feel given the magnitude of the challenge that industry bodies in conjunction with governments should consider introducing punitive measures for retailers who don’t commit to reducing their emissions. Zara seems to be making some progress but without intervention from on high, I’m not confident that they will have the motivation to reduce their emissions to sustainable levels.
Thanks for bringing this topic to light! I was shocked to hear that apparel is the #2 industrial polluter. Overall, I think Zara has been hypocritical in addressing sustainability head-on with initiatives like leveraging recycled materials and yet failing to operate in an environmentally responsible way through its core business model. For example, even within the fast-fashion segment, Zara changes its designs once every two weeks, which is six times more often than its competitors [1]. This frequent turnover means that Zara also contributes higher than average rates of harmful emissions through its use of trucking and international air freight. Fundamentally, Zara’s core differentiating point as an on-trend, quick and affordable fashion house inherently conflicts with the ability to maintain an environmentally conscious business model. As such, I have doubts whether Zara is truly committed to sustainable practices or whether innovations like its energy-saving store models are just a marketing ploy.
I completely agree with you that Zara needs to hone in on its supply chain and raw materials procurement and share quantifiable metrics on its progress towards sustainability. I hope Zara can follow Nike’s example and pursue opportunities to (1) integrate its raw materials suppliers more directly with its manufacturers as opposed to outsourcing and (2) strategically design its clothing to require less material overall to help reduce its carbon footprint.
[1] https://www.tradegecko.com/blog/zara-supply-chain-its-secret-to-retail-success
Great post, Caroline! This is a thought-provoking assessment of Inditex’s sustainability initiatives. I am curious to hear your thoughts regarding the potential reputational risk inherent in the company’s decision to “go green” in fast fashion. As we learned in our IKEA discussion the other day, people do not buy IKEA products because they are sustainable. Similarly, I wonder if Zara customers might be turned off by the notion of a “fast fashion recycling program”. It is my understanding that part of the fast fashion value proposition is that there is a perception of luxury, albeit at a much more accessible price point. The business model is dependent upon quickly responding to the latest trends in high fashion – Inditex could damage its brand unless the taste-making luxury houses also decide that sustainability in fashion is a worthwhile initiative.