11 September 2024
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Sustainable entrepreneurship, there’s no way around it by 2023 you would think. But it’s not made easy for small players. Besides having to compete against the (false) green claims of big retail chains, they also have to find the right balance between the well-being of the planet and that of their business. The current economic landscape also complicates the situation and puts a sustainable lifestyle on hold for many consumers. Despite the sustainability world looking peaceful from the outside, there are a lot of struggles that entrepreneurs face. Unfortunately, the climate crisis does not disappear like snow under the sun as other crises flare up, as previously reported on COSH!
Around 60% of the sustainable retailers who responded to the COSH! survey (summer 2023) experience stress to the point where their mental health is affected. The challenges they faced in 2023, which were mentioned most frequently, are: rising fixed costs, rising variable costs, a decreasing number of customers, consumers’ declining purchasing power, lack of marketing and visibility, changing consumer preferences, limited financial resources and competition from major retail chains.
What makes it so challenging?
Buy less, buy better The “green consumer” gets the message and has already started buying less. But more people need to find their way to these more sustainable shops. Only more people buying less but more sustainably will secure the existence of pioneering companies.
Reforming the economy requires not only companies to act differently, but also consumers to be on board with the story of the state of the world. Unfortunately, the majority is not (yet) aware of how polluting the fashion industry is. Especially not on how everyone can contribute to a more sustainable world. In general, the origin of clothes is not questioned enough and convenience and low prices take priority. The average garment in the Netherlands cost around 16 euros in 2017.
Buying less and better is the message! To stay within planetary limits, each individual should buy a maximum of 5 new ‘conventional’ garments per year, according to the Hot or Cold Institute. During inflation, it is therefore not recommended to shop a lot of cheap clothes. Instead, try to dive into your closet, discover your style, shop locally and buy quality more durable items that you actually wear and later repair or resell locally, second-hand. You can complement these 5 items with locally upcycled fashion, second-hand as well as rented or borrowed clothes. Take a look at how much you can spend on the clothes you need in a month and spend this amount consciously.
The “green consumer” gets the message and has already started buying less, a win for the planet you would think! For the sustainable entrepreneur, on the other hand, this news strikes twofold. The sustainable pioneers, like Supergoods, welcome this awareness, but on the other hand have to cater to twice as many customers to generate a similar turnover as a conventional shop. But as soon as more people find their way to these shops and more people start buying less, the balance can be restored so that these leading and pioneering companies can survive. Their guiding position on sustainability is crucial.
Fashion psychologist Marleen Beevers argues that consumers need to be informed about ALL the negative consequences of their buying behaviour. “Besides the impact of overconsumption on climate change, the impact on people’s mental health and overall well-being is still underestimated. So sustainability should not only focus on WHAT people wear, but more importantly WHY they wear it. They should be educated about the power of their own minds and the potential to change their behaviour for the better.”
Creating more awareness and triggering behavioural change is something many sustainable shops get their pleasure and motivation from.
COSH! asked sustainable entrepreneurs what they enjoy about their jobs and some of the answers were:
Petra, owner of Petra Used & Vintage Clothing in Tilburg likes to create awareness about consumption behaviour among new customers. “Because then it turns out that it (read: buying second-hand clothes) is all ‘fine’, making consumers even happier through their purchases. Besides, you can be more meaningful to people with all the unique items available in your collection. In short: the ‘feel good/feel green’ level among consumers is a lot higher compared to other (large) clothing chains, putting an even bigger smile on the consumer’s face!”
A staff member of children’s shop Zonnehoed in Zwalm also values connecting with customers. “Guiding them in their steps towards a more sustainable life. The moment when they realize that this is actually cheaper, that’s the reason I do it. Every little step we take towards a better world is important. I always turn cheerful when I can genuinely help someone with what they really need. So that they don’t buy stuff they can’t use anyway.”
Designer Romy of Logocomo in Amsterdam enjoys the social aspect the most: “Through my work as a ‘social fashion designer’ on upcycling projects, I meet really nice people from different backgrounds that I would never meet otherwise. This is necessary for a better world and gives priceless satisfaction.”
“The prices of new fast-fashion clothes are attractive all year round but put pressure on all people working in the sector.”
Cheap, cheaper, cheapest
All too relevant at this time of year: the big markdowns. You only have to walk down the high streets and the words “SALE”, “CLEARANCE”, “LAST CHANCE”, “LOWEST PRICES”, will overflow you.
For some retail chains, it has become daily practice to offer clothes at discount prices, whatever the season. What was once a way to sell the last pieces off the racks is becoming the norm these days. And that makes sense, nowadays collections are also released more frequently than traditional seasons and shops have to get rid of their stock before it goes out of fashion. Also, clothes are made of lower and lower quality, especially to sell a lot and cheaply. All to mislead consumers and make extra profits for the benefit of shareholders.
But what is that like for a shop with sustainable operations? They want to ensure fair wages and prices throughout the supply chain and need their own margin to pay (rising) energy prices and wages. And how is it for a second-hand shop, which usually benefits from successful sales as an alternative to cheap prices during the clearance period? Now prices of new fast-fashion clothes remain attractive all year round.
Online shopping versus the shop in brick
You can find everything online nowadays, and that has its advantages, such as better chances of finding your size or not having to leave the house to look for something in town.
However, the rise of online shopping has brought drawbacks to the well-being of brick-and-mortar shops. Online, you can easily pick out where you can get a product at the cheapest price and make a purchase there. Because brick-and-mortar shops simply have a different cost structure than online shops and, for instance, pay rent for a shop premises in the city centre and have retail employees, they also have to maintain different margins and prices.
Niki De Schryver, CEO of COSH!: “Moreover, many large webshops grow by focusing on sales and customer acquisition regardless of end-of-year margins or profits. They lure investors with growth figures and finally present break-even results only after X years of investment and unfair business practices such as free shipping and returns. As long as no fair margin is calculated, the company also evades supplementary profit tax. Consequently, it does not fully contribute to local taxes that affect the country’s social system and healthcare provision, among others. The independent retailer does contribute to that. This is unfair competition in our eyes.”
Even second-hand shops are having a harder time attracting customers into their shops due to the rise of online platforms such as Vinted. For instance, Kathleen, founder of second-hand shop for children’s, teenage and women’s clothing, Closet Stories in Ghent, says: “Vinted did give the image of second-hand clothes a positive spin.” But what is the effect of Vinted and other online sellers of second-hand clothes? “Less (quality) clothes are turned in to physical shops, as reselling them yourself is easy and brings in quick cash.” It also creates an image that second-hand clothes must be bargain-priced, while shops that curate and select their clothes by hand, sometimes even repair them and sell them in-store, must charge different prices.
As a consumer, it’s important to ask yourself what the value of a garment is to you. And what the experience of buying from a nice local shop does to you. Here, staff can help you find the right size, fit and style and also avoid a lot of packing and (shipping), which detracts from the sustainability of second-hand or sustainable first-hand shopping.
Conventional investors do not yet understand the new economy
We need a new economic system
Something very different, on a corporate level, is how the old, capitalist system is so deeply ingrained in society that it takes a long time to make room for the ideas of a new economic system and a new definition of success.Martiene, freelance curator of sustainable fashion and brand strategist of the now bankrupt TOMO department store, admitted at the COSH! launch event in Germany that: “How new sustainable businesses want to grow is not in line with how investors and the old system works. The old system, money (perception of money having to grow fast), does not take into account the time it takes to raise awareness.“
Niki De Schryver, CEO of COSH! argues that this is precisely why, large sustainable department stores in the conventional high street or shopping malls don’t work (yet). “You need destination traffic and building that audience takes time. On top of that, sustainable consumers spend more consciously, take more time to decide, and put fewer items in the basket at checkout. So you need to reach more of them and that takes even more time.”
“Greenwashing” compared to real “green fashion”
Greenwashing and truly sustainable fashion are sometimes hard to distinguish. Sustainable fashion no longer seems to be an exception, with almost every shop selling a few items made of “sustainable materials”, “recycled materials” or “made with care”. However, these claims are not always properly explained, or negative aspects are concealed.
This doesn’t only create confusion for you, as a searching consumer who wants to make better choices. But also makes it difficult for sustainable retailers to determine what they should or shouldn’t communicate about to maintain credibility. Especially knowing that “not buying” is always the most sustainable option. Moreover, it is difficult to prove, for example, that as a small maker you have a 100% zero-waste manufacturing process.
Still, being able to tell about the sustainability of their offerings is a big driver for local entrepreneurs. Consumer awareness is growing, but sometimes not yet sufficiently large to understand the differences in supply chains and business practices between different companies.
Support your locals
We all want to prevent the planet from collapsing because of our consumption behaviour and leading sustainable entrepreneurs can pave the way to a circular economy.
A new batch of investors must rise and dare to invest in the economy of the future that grows more slowly but steadily.
Moreover, we ourselves need to shop, rent and swap at shops that are shaping the new economy and ensure that they can continue this way of doing business. Support entrepreneurs you buy from because of the people and the story behind a product, not because of a misleading vague green claim.
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