Energy and the future of the apparel industry

I’ve been thinking about something I need some help with and I’ve hit a dead end, maybe you have some ideas. This concerns the future, what our industry will look like in ten years or twenty years. It concerns the price of energy and sustainability. Let me back track a little.

When eco-fashion and sustainability became a trend, I was cynical. The reason is because I’ve been on the sustainability and social responsibility bandwagon since I was nine years old when I started organizing bake sales to raise money to buy nesting area for the bald eagle. I’ve spent 35 years of my life being the weirdo hippie in the crowd. Everybody laughed at me or labeled me an ecological extremist and a doom-sayer. Whatever. Now it’s hip to be eco-aware, hence my cynicism – I am finally “cool”. Mindbending when you’re used to being on the outside looking in and everybody made fun of you for over-reacting. I’ve been thinking about eco-apparel, wondering if the eco-fashion thing would just be a fad, weaned out next year in favor of argyle socks. I do think it is a fad for some people, few of whom are willing to make substantive lifestyle changes required for dramatic and genuine change (thank me for skipping the why you should become a vegetarian lecture). In sum, the situation is such -with respect to energy prices and global warming- that focus on the environment is not a trend but a growing crisis we will be forced to confront in this industry. As such, how will this affect apparel production?

Gas prices will not go down, we’ve passed peak oil production and are now on the downward slope. Sure, we may see demand drop if we develop alternative energy sources but some argue we hit peak oil around the time I was manning the bake sale stand. If gas prices doubled over the next ten years, what would be the effect on our industry? What if prices tripled or quadrupled over twenty to twenty five years? This is very conservative; gas prices have quintupled in the past twenty five years, the increases absorbed and mitigated by worker productivity increases of the computer age. Considering the increasing tears in our social fabric and limitations on the horizon to increasing worker productivity, I cannot envision that disposable incomes will keep pace in the future as it did in the past. The incomes of generation me-ers as compared to housing costs are proof enough of that. Our poor will become poorer as will the middle class. As though this were news to anyone.

Loosely, my thought is that regional apparel production by DEs will be favored, a competitive advantage, the only sticking point being fabric supply considering the number of domestic mills that have shut down (not as though they sold to us anyway). Still, there is a trend toward the gestation of smaller domestic mills, Bamboosa is one (although they must absorb higher energy costs of importing their thread). I’m sure there are others but I can’t get a fix on them. Also, it is possible that Mexico will be picking up the slack (based on an article from last week’s Apparel News). There’s a lot of untapped thread production potential in Central America too.

I also think that as the cost of apparel (everything of course) will increase and it’s doubtful disposable incomes will keep pace with the costs of energy, that people will be less profligate with regard to clothing purchases. I imagine the tendency to be one of buying goods of better quality and longevity, more classics and fewer faddish fashion purchases. Again, this will favor DE production, disfavoring off shore apparel commodities.

In sum, due to the costs of shipping, I think apparel production will revert to some semblance of the idyllic 1950’s. We will see a return of regional production and clothing sales (we already are, many large companies are trying to get production slots in the states). Regarding even mass producers, I think production will get closer to the point of sale with Mexico and Central America favored over India and China. Previously, most producers sold within the region of the country in which they produced, empires weren’t so far flung. Most manufacturers produced for customers around them, people they could see. If you think about it, the complaints of sizing and the fitting of apparel has only become an issue since producers started selling to customers outside of their regional production environments. Generally, I view regional production as a positive. We used to have a lot of factories stuck in rural areas outside of larger cities. Many of those people, mostly women, never regained full time employment. It’s quite tragic really but maybe they’ll be the winners the next go round.

What would the effect on our industry be if gas prices doubled over the next ten years? What if they tripled or quadrupled over twenty to twenty five years? Any prognosticators in the crowd?

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  1. dawn says:

    This seems one of those things about which there are too many variables to consider. Gas more expensive means more people locating in villages and cities again. More reliance on mail and online services (yes, mail uses gas too but it’s cheaper for me to order fabric online than to drive 60 miles to get it.) Different types of transportation.

    More home sewing? More local garment production. More re-inventing of clothing styles, i.e. the current craze over “altered couture.”

    It’s all interesting to think about, but overwhelming as far as trying to make predictions.

    Personally, though, I hope I can still have a hamburger in 2030, so thanks for sparing that part of your post!

  2. Andrea says:

    oooh…me, me! I love this topic. Partially because I live in the land of alternatives….to toxins, to fossil fuel, to meat, to conventional anything. Not that I agree with the lion’s share, but in Humboldt County, we are redefining the face of business to reflect a regional economic and social infrastructure that will sustain itself. The main ingredients to this are 1)bio-diversity. We have a unique ecology that allows us to have both farming and fishing
    2)A relative low cost of living because of our isolation. Until recently, many businesses would not locate here because at least once a year for a couple weeks all the roads in and out flood
    3)Poverty (and pot growers) breed innovation.
    4) Humboldt County people are tough and committed.

    I believe there are a lot of communities that are like this in the US. We have one major sports apparel manufacturer (Kokotat) here that not only employs and trains their workers, they also offer a really great work/life balance. They recycle, donate back to the community and have one of the most beautiful facilities. But I digress. The future of all industry, I believe, will become regional. That’s the only way it’ll make sense. I don’t think the american people will suffer such a wide social class divide easily. Americans are the progenitors of innovation in crisis…I think we will embrace change before defeat.

  3. sahara says:

    As a tech designer, this is something I’ve thought about for a while. I started out in knitwear, back when a number of the mills were located in Brooklyn and Queens, and goods were designed, produced and shipped regionally, even for bridge lines. Lord knows, it was easier to get things done; and this was during the eighties, no less.

    I hope there’s a return to regional production in New York, but an effort has to made to train (or re-train) a workforce. The labor shortage is fierce, and young folks don’t want to sew––there’s no fame. Maybe that will change, when dressmaking becomes a respectable profession again, a by-product of the demand for luxury.

    I don’t see the return in Manhattan, but maybe in the outer boroughs, like the Brooklyn and the Bronx, where manufacturing was again thought about (before the real-estate push), and where Everlast relocated. Ironically, I am surrounded by a skilled labor force of Mexican women, who would work if they were paid fairly.

    And it does work. Sailor Jerry in Philidelphia, produces their own clothing, has a store, sells online, and ALL of their fairly paid personnel either walks or rides a bike to work. A group of us DE’s and artisan’s are trying to push local politico’s for incentives for more production in the Boroughs, but we’re fighting the real estate interests.

  4. Diane says:

    Greed still prevails. My daughter works for an attorney’s office that handles foreclosures. They are projecting 32,000 foreclosures this year and they are training workers in Panama to handle this load. They’ll keep some of the paralegal staff but the rest of the jobs will go to Panama because they can pay employees $5 a hour. So, the outsourcing continues and not just in the tech sector. As energy costs increase perpetuating the peak oil myth I hope to see cottage industries on the rise. The commute from bedroom to basement is a short one.

  5. Karen C says:

    First, I’m shocked about the $5 an hour paralegal work. The attorneys and banks will get what they pay for. A similar situation happened to me about 15 years ago, when they thought they just just train people to do our paralegal jobs at $10 an hour in a big warehouse, inputting data. That lasted about 9 months.

    I think with F-I and our network we can bring back cottage industries and co-ops. There’s a demand from both the consumer for our wares and from us as to the type of work we want to perform. It’s doable.

  6. J C Sprowls says:

    The commute from bedroom to basement is a short one.
    Amen! And, there’s no reason it can’t be done. Frankly, I agree with all the statistics out there saying that telecommuters are happier and will work for slightly reduced rates. And, why not? I don’t have to do as much laundry, dry cleaning, waste money on lunch, etc. Plus, the majority of single parents I know want to be close to home.

    Coming back around to Kathleen’s point about conservation… I think it’s the wee guys, like us, who are the best audience for this discussion. If conservation and wholistic values are instituted into the genetic code (as it were) of our businesses we have a better chance of a) maintaining those values and b) keeping our businesses alive.

    Big businesses, in contrast, are not eager to adopt these practices because so much needs to be undone and converted before they can implement “new” processes (note: sarcasm). The analogy frequently used in the corporate world is “herding elephants” or “steering elephants” to illustrate the difficulties of managing a large organization. Personally, I call it whining in hindsight – but, that’s a different story.

    Frankly, that statement reveals to me that CEOs are still being taught (enculturated, conditioned, etc) that they have to dominate their operation instead of polarizing, harmonizing and leading. It also tells me they have never ridden a real horse or elephant. Otherwise, they would know you cannot dominate these animals and expect to get anything out of them.

  7. Diane says:

    I think this topic is really interesting.

    The company I currently design for used to produce everything stateside and ran into some major problems with late (in excess of 3-4 weeks) delivery times, poor quality, and managing production costs. This was before my time and admittedly probably had more to with production management on our end than the production facilities. We’ve been manufacturing in China for the past 4-5 years and have been satisfied, if not ecstatic, with the process and the pricing has been good. The interesting thing is that now we’re looking into moving our production back to North America (mostly Canada) because of lower shipping costs, reduced lead times, etc.

    This seems to be a trend amongst most designers and production managers I’ve spoken with over the past couple of years. They may not be ready to move all production right now but it seems to me like people are starting to explore other options and are open to alternatives. Maybe I’m being an optimist but I think this trend will continue, especially as rising fuel costs and a demand for more sustainable business practices push the efforts.

    I’d be interested to know the stance of other industries on this too.

  8. Babette says:

    Another issue with peak oil and rising prices is that natural fibres become more competitive.

    Most synthetic fabrics are made from oil-based derivatives. These become more expensive directly in line with the increasing oil price. Polyester may no longer be the cheap option.

  9. I totally relate to the dilemma and doubt you have with this trend. I also was the type of 9-year old that you were. And now I work in the business of mass fashion production. Production in Europe though, but still a lot of viscose and oil-based derivatives fabrics not to mention dirty cotton. Next to this job that pays my bills I have an eco-fashion label myself, I invest all my extra moeny on my own eco-friendly label. I see it as a cycle. I invest in changing the world by promoting a new market that should and could develop. It is so hard to change the familiar paths people walk. But by trying a little, we wake up people to give us eco-fashion and the before mentioned alternatives to a lot of polluting things. That’s why I hope eco-labels won’t don’t use recycled materials only- but mostly buy good new fabrics. It’s a new inductry that needs money and using old stuff will not get this wheel turning. I try to get my boss to jump in the eco-trend. If this is a way people will accept a change, through a new trend only, then so be it!

    I agree that greed prevents a lot of good change, but I think that greed can be
    Let’s say it’s cool to be eco. Greedy people will act on it too and see the possibilities to make money in this area. I have faith and I don’t mind that it took the world sooooooooo very long to realise a change had to be made. One thing; governments should be faster making new rules and that I do see as a problem, many governments are driven by the old polluting industries.
    If it means the clothes will be made in your own (western)country with expensive fabrics, so be it. With the internet and such, fashion will be more versatile I think. New times ask for new creative minds. More individuality I hope.
    Best regards,

  10. Natty Coleman says:

    Babette raises a good point. Demand for organic fibers will surge because prices on the petroleum based fertilizers and oil to run farm equipment itself will skyrocket, forcing a lot of those types of farms out of business. Synthetics fabric isn’t an alternative because as Babette said, a large number of them are petroleum derivatives. Oil is also tied directly to the energy required to make a lot of the equipment we all use as well. Manufacturing costs relating to machines and equipment will also skyrocket. All of this WILL occur unless we devote what is left of our hydrocarbon resources to building a new energy infrastructure(instead of using it to power the military-industrial complex). Even IF we manage to agree on something like that, we’ll all still feel the class-polarizing economic whiplash.

  11. Eric H says:

    Keep in mind that some natural fibers like cotton and its downstream processes (cleaning, spinning, dyeing) are also energy intensive. It isn’t a matter of whether the product is made from oil directly (polyester, nylon) or indirectly (cotton), but rather a matter of which gives you more bang for the buck/barrel. Even organic cotton has to be processed, and there are some dirty little secrets there. Then there are the issues of long term care (washing, drying, pressing). I think organic cotton may win, but I’m not sure it wins hands down.

    For example, what about recycled plastic? ALCOA currently pays for aluminum cans, but very few other industries actively seek recyclable inputs. ALCOA does it because it’s profitable. I suspect we may see more industries move in that direction as their raw inputs get more expensive, including petroleum-based fibers.

  12. Kevin Carson says:

    Very thoughtful post.

    The rise of small, electrically-powered production machinery in the late 19th century was seen by many as the beginning of a new phase in technological history. Lewis Mumford later referred to the new era as “Neotechnic,” a decentralized model of production that would gradually supplant the “Paleotechnic” (the latter era characterized by centralized technologies suited to the needs of the new absolute states and privileged mercantile interests–e.g., mining, arms manufacture, and “Dark Satanic Mills”). Because machinery was freed from the need for co-location, and from dependency on a single prime mover or drive shaft, small-scale (even home) production was made competitive with factory production.

    The electric sewing machine, interestigly, was the first major example of small-scale electrical machinery.

    Back in the ’30s, Ralph Borsodi experimented with a variety of forms of household production, and found that (among other things) home-growing and canning, weaving and sewing, and furniture making, could all be done more cheaply overall at home than in a factory. The unit costs of production were still slightly lower in a factory, but the distribution costs of small-scale production were almost completely eliminated because goods were produced at the point of consumption. His first experiment in this regard was with tomatoes: figuring the costs of all gardening supplies and canning equipment, the power used, and the value of his and his wife’s labor time, he figured that home-grown and -canned tomatoes cost about a third less than storebought.

    I can’t sew a lick myself, so take this FWIW. But aside from the relatively low cost of a small loom and sewing machine, I would guess the main barrier to small-scale production is the learning curve. And the costs of transferring information from one person to another–both basic skills and things like designs and patterns–are probably lower than ever before, what with networked and peer production.

    As to the effects of peak oil, if fuel prices really do double, or quadruple, I expect one result will be the rapid rediscovery and reclamation of a lot of different forms of household production to fill in the gaps as the centralized distribution system begins to collapse. I expect, among other things, that a lot of quarter-acre lots in the cul-de-sacs will be spaded up and used to grow food. Those with sewing machines will find it profitable to use them in earnest as real production tools, bartering their labor for surplus crops of others in the neighborhoods. Backyard shops will custom machine replacement parts to keep appliances running, the first step toward a localized economy of production by general-purpose machinery rather than heavily capitalized factories with specialized machinery.

    The how-to information is out there, and the building blocks of local production are already widely distributed. The question is whether people can get over the learning curves, and put the building blocks together, faster enough to cope with the dislocation.

    Sorry for such a long rant (especially one that may seem to come mainly out of my, er, hat), but this a topic that really gets me going.

  13. Jamie says:

    I never really took the time to think about ten to fifteen years from now when I would be most effected by this but looking over your blog two or three times made me think more about the issue. In the future it will be a struggle for designers to buy and sell anything from buttons to yarn and have it shipped nationwide, which will in turn slow down business. No doubt about it. Gas prices are not going to ever go down significantly, maybe two cents cheaper if we are lucky, and in ten years if it costs 17.42 for gas, shipping prices will be outrageous, and smaller business’ are going to be put out of business. It makes me realize the hard work I am going to have to do early on in my career to keep me going strong in the future. I appreciate the eye opening.

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