Generations Y (millennials) and Z are much more aware of the environment than prior generations at their age. They also feel more personally responsible for their health and wellness. With the advent of social media, consumers have more access to information to make informed decisions, often selecting cleaner products with fair supply chains and socially responsible missions.
The apparel industry, which is already reeling from the shift to ecommerce, is also seeing notable change from consumers’ increased demand for sustainable companies. Apparel manufacturing typically treads heavily on the environment, and consumers are starting to realize the true cost of buying a new garment is much higher than the retail price. As one sober example, textile production results in more greenhouse gas emissions than all international flights and maritime shipping combined.
As Generation Z and millennials seek to make informed choices in their mission to leave a smaller carbon footprint than previous generations, we believe the rental and secondhand channels will take significant share over the next decade. Younger generations see no stigma from buying secondhand items and take pride is being part of the circular economy. We believe “Peak Clothing” has occurred in the US and that garments per capita will decline in the future.
Todd Wakefield, research analyst, equity research team, Newton Investment Management
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