Fashion’s Climate Crisis: Why B2B Innovation Holds the Key to Cutting Emissions in Half
Oct 28, 2024
3
min reading
The fashion industry faces an urgent call to cut its massive carbon footprint, responsible for at least 4% of global greenhouse gas (GHG) emissions. From the production of raw materials to distribution and sales, each step of the supply chain contributes to a pollution problem that’s rising with consumer demand.
As outlined in the "Fashion on Climate" report by McKinsey & Company and the Global Fashion Agenda (GFA), without drastic action, the industry’s emissions could grow from 2.1 billion tonnes in 2018 to 2.7 billion tonnes by 2030. But with decisive B2B innovations, there’s potential to slash emissions by half by 2030, aligning with global climate goals. Here’s why change is essential and where the biggest impact can happen.
Current Emission Status: Fashion’s Carbon Footprint
As it stands, fashion’s GHG emissions equal the annual emissions of major nations like France, Germany, and the UK combined. And this is just what is estimated, because there's a lot of undernoticed numbers.
Shockingly, 70% of these emissions stem from upstream activities—from raw material production to fabric processing and manufacturing—while downstream activities, like retail, shipping, and consumer use, account for the remaining 30%.
With the global population and demand for clothing both expected to rise, the industry’s emissions could balloon without bold intervention.
The Economics of Emissions Reduction
According to McKinsey & GFA, 55% of emissions-cutting measures could actually save money. Actions like switching from air to sea freight, improving manufacturing efficiency, and adopting renewable energy sources present clear financial and environmental benefits. The report estimates that reducing emissions by half could result in over $600 savings per tonne of CO₂. However, other measures, like increased recycled material usage, could raise costs short-term but bring long-term gains by reducing the industry’s reliance on virgin resources.
Key Pathways to Emissions Reduction: Bold B2B Innovation is Essential
The "Fashion on Climate" report presents two potential pathways: a "Current Pace Trajectory," where industry emissions remain stagnant at 2.1 billion tonnes, and an "Accelerated Abatement" pathway, which requires cutting emissions to 1.1 billion tonnes by 2030.
To get there, the fashion sector must embrace innovative solutions and collaborations across these three primary areas:
Upstream Operations: With 60% of potential emissions reduction within upstream operations, decarbonizing raw material production is crucial. This includes shifting to renewable energy in production, minimizing waste, and embracing cleaner fabric processing technologies.
Brand-Owned Operations: Through energy-saving practices, efficient logistics, and sustainable packaging, brands can cut emissions by around 20%. For example, reducing overproduction—currently leading up to 40% of garments sold at markdowns—not only cuts waste but also curbs the unnecessary use of resources and emissions associated with manufacturing surplus inventory.
Consumer Behavior Changes: Encouraging consumers to buy less and opt for circular business models (like resale, rental, and repair) could contribute to a 20% emissions reduction. The report suggests that one in five garments needs to be part of a circular model by 2030 to meet climate targets. Changing consumer habits won’t be easy, but it’s an essential step.
Innovation in B2B: The Missing Link to Drive Real Change
While there’s been remarkable innovation in digitalizing consumer shopping—from personalized apps to gamified experiences—B2B technology has lagged. Most B2B operations still rely on fragmented systems, outdated methods, and middlemen. Imagine if a designer could source sustainable materials with the same ease as consumers shop online. Today, sourcing for new collections means multiple emails and phone calls to coordinate with each supplier—an outdated process that wastes time, money, and resources.
The real breakthrough will come from connecting designers directly with certified suppliers on a single, streamlined platform, eliminating middlemen, enhancing transparency, and cutting emissions by reducing inefficiencies across the board. A digital, centralized B2B marketplace can transform supply chains, simplifying sourcing, reducing time, and slashing emissions by connecting designers directly with sustainable, vetted suppliers.
We have created this platform for you. It's called World Collective Marketplace and it's live!
The Role of World Collective in Driving B2B Transformation
At World Collective, we’re tackling this very challenge head-on. Our mission is to empower brands, particularly small and medium enterprises (SMEs), to adopt sustainable practices through a tech-driven B2B marketplace designed to eliminate the barriers to sourcing eco-conscious materials. Our platform provides transparent, traceable, and sustainable textile options that align with strict environmental standards. By offering no-minimum-purchase requirements, we’re opening up sustainable sourcing to all brands, from emerging designers to established names, regardless of scale or budget.
For fashion to genuinely lead in the fight against climate change, B2B innovation must be taken seriously. If the industry continues relying on outdated practices, we risk hindering progress toward climate goals. However, with scalable digital solutions, streamlined sourcing processes, and strong industry collaborations, fashion can move towards a more sustainable future.
Beyond 2030: Rethinking Growth in Fashion
To stay on track for climate targets beyond 2030, the industry must break away from its reliance on high production volumes. The report calls for a shift from volume-based growth—producing more to sell more—towards value-driven growth, emphasizing quality, circularity, and innovation over sheer quantity. By prioritizing made-to-order production, increasing resale and rental options, and investing in low-emission materials, brands can build a profitable future without the environmental costs.
For brands, this means shifting strategies from pushing excessive products to focusing on long-term customer value through extended garment lifecycles, repair services, and buy-back programs. This pivot not only aligns with consumer demand for sustainable options but also offers a pathway to reduce reliance on constant overproduction.
The Power of Collective Action and Innovation
Fashion’s path to a low-emission future won’t be easy, but it’s possible with industry-wide commitment, collaboration, and a bold approach to B2B innovation. With World Collective’s Marketplace, we’re setting the stage for an industry that puts sustainable sourcing, traceable supply chains, and low-emission goals at its core.
Fashion doesn’t need more of the same; it needs a radical shift. As we work on the marketplace that is transforming B2B sourcing, we invite brands, suppliers, and consumers alike to join us.
