Sustainable fashion: what are the current trends and opportunities?

You don’t necessarily need loads of capital to start a fashion line: it’s possible to launch with less than £5000. What you do need is a way to stand out.

Why? Because the fashion market is crammed with options, many of which have little to distinguish them from one another, both in terms of ‘look’ and price point.

One key area of growth within the fashion industry is sustainable clothing, for reasons ranging from increased awareness of the environmental impact of fast fashion, to people wanting a more individual, less mass-produced look.

Gone are the days of weaving kaftans from lentils. Here, we’re referring to clothes produced in a way that minimises their environmental impact – in ways ranging from the materials sourced, the manufacturing methods employed, the distribution modes used, and the fair treatment of employees.

Below, we’ll outline the current trends in this niche market specialty, as well as identifying the opportunities for success, as demonstrated by inspirational business case studies.

Top five sustainable shopping trends today:

1. Reusable packaging

Packaging that can repurposed is a win in the eyes of the ethical shopper – and it’s not just a question of what can be put in the recycling bin, but of creating ways that enhances brand awareness – for example, packaging a dress in a drawstring bag made of fabric off-cuts, which can then be used as a laundry bag when travelling.

2. The rise of resale

Second hand clothing is big business, as the success of apps like Depop show. According to a report from Thredup, the global fashion resale market is expected to grow 127% by 2026. For budding side-hustlers, there are also tax hacks.

3. Less is more

As the late Vivienne Westwood said, ‘Buy less, choose well, make it last.’ Yes, sustainable fashion may cost more than fast fashion, but the latter is ultimately a false economy – a fact that consumers are becoming more aware of.

4. Recycling

It’s not just individual sellers and thrift stores driving the recycling trend – big names like H&M and M&S are providing incentives for customers to recycle their unwanted garments.

5. The rental market

Ever bought a dress for a special occasion, only to have it languish in your wardrobe thereafter? Enter the concept of renting an outfit, paying a fraction of what you would have paid for it new – and then returning it to the renter. Less expensive, less wasteful, and less clutter in your closet.

Is there money to be made in sustainable fashion?

For the entrepreneur, there are evidently opportunities to be seized in the sustainable fashion market, as the above statistics show. But how do you start a clothing line that is both a viable and, ultimately, profitable business opportunity?

Recent figures indicate that the sustainable fashion industry is currently worth around $6.95 billion.

That figure is projected to reach $10.281 billion by 2025. That’s just two years away – so if you’re interested in starting a sustainable clothing brand, the time is ripe for disruption.

Other statistics giving evidencing the growing value – and potential – of the sustainable clothing market include:

• McKinsey’s State of Fashion 2022 report states that 43% of Gen-Zers say they actively seek out companies that have a solid sustainability reputation.
• 77% of shoppers surveyed in a 2022 report by Drapers say they consider sustainability when buying fashion, either all the time or sometimes.
• In the UK, there has been a 50% rise in online searches for ‘second-hand clothing’ year-on-year from June 2021 to June 2022, according to small business insurance provider Simply Business.
• A whopping 75% of Gen Z respondents said that reducing consumption was one of their primary motivations for buying pre-owned clothes. (Depop)
• Shares in the fast-fashion brands, Boohoo and ASOS fell by an average of 74% in 2022.
• It’s not just the ‘everyday’ clothing market being affected – according to insights from The Business Research Company, around 66% of respondents take sustainability into account when purchasing a luxury product.
• Nor is it just the product itself that matters: almost half of the UK’s major fashion brands (46%) published targets on sustainable materials according to the Fashion Transparency Index 2022.

Successful growth stories include Kent-based Elvis & Kresse, which makes belts, bags and other accessories out of decommissioned firehoses. Starting in 2005 with just £8,000 and a design for a single belt, they now employ over 25 staff and produce tens of thousands of products annually, donating 50% of their profits to the Firefighters Charity. They also use renewable energy and package all of their products in repurposed materials.

Another pioneer in this arena is People Tree, which was founded in 1991, with a core mission of making clothing to the highest ethical and environmental standards, from design to shop floor. It was the first fashion company to be awarded the World Fair Trade Organisation product label – and has a turnover of between £2 and £10 million per annum.

Sustainable Startup Inspo: Kind Bag

María Rodríguez founded Kind Bag, a sustainable business that makes stylish, recycled accessories to fight plastic waste. In 2023, it announced strong growth for the third year running, with turnover of £940,000 (+45% YOY). Growth was fuelled by UK sales (up +55% YOY), indicating this is a strong market for sustainable goods.

Read more about Kind Bag

Do you need a physical store?

Conducting a business online, rather than renting premises, can reduce overheads, as well as reach a larger audience.

Another benefit of promoting and selling from an online platform is that potential customers can navigate to different links that explain the ethos behind your brand; the provenance of your materials, and your company mission statement.

It also allows them to ‘get to know’ the founders: this personal touch may be especially important when customers are spending more money on garments that they are trusting to be worth the cost, in terms of sustainability, durability and all-round quality – because when attempting to influence consumer habits, trust is key.

Benefits of a physical store today

Even though e-commerce has grown exponentially in recent years – global ecommerce sales have increased by nearly 800% since 2010 – there are still benefits to a bricks and mortar store for your sustainable fashion brand.

For one thing, ecommerce businesses frequently comes under fire for over-packaging. Boxes far bigger than their contents require is one issue; another might be an abundance of single-use plastic. Recycled, recyclable and biodegradable materials are definitely more attractive to buyers with sustainability at the heart of their purchasing decisions.

Plus, as the concept of sustainable fashion is, for some people, still so new – and, as we have mentioned above, generally more expensive than ‘fast’ or conventional fashion – there is an element of uncertainty about what people are getting for their money.

The ability to touch, feel, try on, and test products can be a bonus. Experiencing a product ‘in real life’ can help to close a sale, eliminating doubts about size, fit and colour. The result? Fewer returns, and at the same time, less administration – a cost in itself.

Five sustainable fashion startups to watch

Stand4Socks

Manchester-based Stand4Socks are changing the world one pair of socks at a time: for each pair sold, they donate one specially engineered pair to a homeless shelter. Some of the ‘fashion’ socks they sell are made from materials such as bamboo – known to be a more sustainable option than some other fabrics – and are delivered in a 100% compostable mailer.

The socks donated to homeless shelters have been engineered to a different standard from the retail options – they’re made from thick, durable antibacterial material with reinforced seams, in recognition of the different challenges homeless people face. Since its inception in 2015, Stand4Socks has donated almost 263,000 pairs of socks.

TALA

Several activewear brands have made moves in the sustainability direction. One of the best is TALA, which was founded in 2019 and create durable, flattering products from a mix of pre- and post-consumer materials.

Other fabrics used include bamboo, recycled or organic cotton and Lyocell, made from wood pulp. They work only with factories that have achieved ethical accreditation and even the tags on the products are filled with seeds and fully plantable. Additionally, the company’s packaging and courier bags are all made from 100% recyclable plastic.

Hurr Collective

Hurr Collective was founded in 2018 and has since been dubbed ‘the Airbnb of fashion’ by Forbes magazine. On one side of the business, lenders can make money by renting out under-utilised items in their wardrobes. On the other side, renters can ‘borrow’ designer items for about 20% of their usual retail price. They keep an eye on their climate positivity with membership with Ecologi, which calculates their footprint and provides the opportunity to offset via monetary donations to projects to reduce CO2 levels.

What on Earth

Founded in 2020, What on Earth is a beautifully curated collection of fashion labels. They work with designers who use recycled and upcycled fabrics, and with brands that offer full transparency about their business operations and supply chain. The basic tenets of their business model are based on how clothing is designed and manufactured, the materials used, the way the workers are treated, and what transport methods are used.

Lucy & Yak

Lucy & Yak started in 2017 with a small run of dungarees in India, which sold out almost immediately. On returning to the UK, they created a brand with a whole-hearted commitment to circular fashion, with new products that are recycled, organic, closed-loop and come in sustainable packaging. They work exclusively with suppliers that pay a fair living wage as per the Global Living Wage Coalition, and donate to and collaborate with organisations committed to supporting both people and the planet.

Key considerations when launching a sustainable fashion brand

As we’ve seen, there are many examples of fashion labels with sustainability at their core that have become household names.

Obviously, there are no guarantees when it comes to whether a business will flourish or flounder, but here are some tips to boost your chances of succeeding:

1. Define your intentions, as well as the nature of your product, and budget accordingly

Ethical clothing tends to be produced in smaller batches, which can also add to production costs. There’s also the competition of cheaper prices from fast-fashion brands.

If you’re thinking about starting a business based on re-selling items you’ve bought, you’ll not only have to commit time to scouring charity shops and boot sales, but you’ll also need some know-how about what you buy and how much you can resell it for.

Charity shops are becoming increasingly savvy about labels and their worth and it’s unlikely that you’ll be able to pick up a Chanel handbag for a fiver. Even so, there are significant mark-ups to be made when you re-sell, even if what you’ve paid in store doesn’t necessarily correspond to what you might think of as charity shop prices.

2. If setting up an online store, search for the platform with the lowest seller fees

The pandemic, with its physical store closures and reliance upon online retail, has also boosted the sustainability trend: marketplaces such as Etsy, purporting to support small-scale artisans and makers, reported that the total value of goods purchased on the platform in 2021 was over $10 billion.

However, it’s worth noting that platforms like Etsty, which people turn to for recycled, upcycled, vintage or handcrafted items,  involve fees that can impact the seller’s profits – especially once the time spent photographing and writing a description of the item/s is considered. For more information, read our guide to the ecommerce marketplaces for seller fees.

3. Market your brand using social media platforms, collaborations, competitions and – depending on budget – PR.

Social media is invaluable when building any brand. But while you can sell items on Instagram, you shouldn’t just be using Instagram to showcase your finished product. Show your brand story, not your product line, to help the customer buy into the story as well as the item.

Documenting the process of upcycling or recycling for followers helps to bring the garment to life for them. You might even be able to get pre-orders while still in the designing stage.

4. Make your credentials as much a part of your brand’s appeal and marketability as your products

These days, customers don’t just want to see that you’re incorporating sustainable practices into your business. They want you to go the extra mile, whether that’s donating a proportion of your business profits to a relevant charity, or pledging to be 100% carbon neutral by 2028.

Be sure to apply for any and all relevant credentials, too – whether Bluesign, BCorp, Fair Wear – and avoid greenwashing (deceptive use of marketing to position your business as more sustainable than it is).

Research what matters to your customers, so you can position your company and its strategies in the most appealing way. For example, research may reveal that carbon-neutrality is a key concern for your audience. You can then refine certain pillars of your messaging strategy.

Conclusion

Sustainable fashion is one of the broadest categories in the apparel industry. There are a lot of ways into this purpose-led business niche — whether you’re seeking to start a limited company that’s recycling tyres into socks, or you’re a side hustler whose dream is to upcycle clothes sourced from a charity shop.

Whatever the idea, the statistics we’ve highlighted above prove that there is significant demand for sustainable clothing as part of a fashion circular economy. This sub-sector is already showing signs of becoming the dominant line of thinking for fashion industry leaders. And you’re right on time to join in.

As a brief summary, here are our top recommendations for those wanting to start a sustainable fashion business in 2024:

1. Conduct market research to identify a growing trend 
2. Iron out your sales strategy
3. Pay close attention to costing – sustainable fashion can be a lot more expensive 
4. Find a strong brand story that showcases your sustainability credentials