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Green is Good: How Profitability Is Driving Sustainability

When it comes to sustainability, the apparel industry is going for the green—in terms of eco-friendliness and profitability.

That was the message at the Cotton Incorporated workshop on Tuesday titled, “Everything You’ve Heard About Cotton is Wrong,” co-hosted by Sourcing Journal and moderated by Hertzman Media Group founder Edward Hertzman.

“We live and breath sustainability everything because there is a definite link between profitability and sustainability,” said Garry Bell, vice president of corporate marketing and communications at Gildan. “We do it internally because it lowers costs and makes us more efficient.”

Bell believes that while the environmental benefits of are real and necessary, sustainability holds tangible advantages for apparel businesses too.

Energy, water and waste are the key focus areas for Gildan, which regularly looks outside of apparel for inspiration. From the pulp and paper industry, the company learned how to convert dyes and chemicals into natural waste that’s ultimately clean enough to drink, he said. A big plus for the environment but Bell isn’t shy about admitting the motivations weren’t entirely altruistic. “We did it because it saved us money,” he said. “In Central America, energy is very expensive.”

That underscored a point the panel was eager to convey: sustainability, when done right, is more related to cost savings than price hikes. It’s a misconception, they said, that responsible products will cost more.

As an example, Bryan Dill, head of global key accounts at Archroma US Inc., pointed to the company’s new EarthColors dyes, which are derived from natural waste like rosemary shoots, olive pits, almond shells and even cotton itself. In addition to being positive for the environment, the cost for using these plant-based dyes is also comparable to conventional dyes.

The new launch fits with Archroma’s brand ethos, which puts sustainability at the forefront of all product development. But Dill concedes that not all brands are on the same page so the new dyes won’t resonate with everyone. “There has to be a demand for it, but if that’s not in [a brand’s] wheelhouse, then the interest won’t be there,” he said. “From a cost standpoint, there’s no real difference but you need to be able to tell a story and they have to be looking for that.”

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Hertzman agreed, saying brands have to cater to their customers. “A segment of millennials is all about transparency. They’re into the Everlane culture. Then, you have a segment that won’t wear the same outfit twice on Instagram,” he said. “But the question is, who are you manufacturing for?”

There was a time not too long ago when sourcing was all about nickels and dimes, he continued. But for some consumers, it’s about connecting with a story, and sustainability can provide that. As a result, Hertzman said, “A dime won’t make or break your company today.”

Marketing matters

One of the stories that retailers are telling more and more is about recycling, upcycling and the circular economy. In an attempt to keep garments out of landfills, more brands are hosting take-back programs that encourage consumers to return their used items, which can then be used for things like insulation. “It’s great for the environment but it also gets consumers back into stores,” Daystar said, envisioning a scenario where shoppers stop in to drop goods off and ultimately end up shopping for new pieces while they’re there. “The programs create value for the company.”

Getting consumers on board with sustainability is a big part of what will help encourage the entire industry to adopt more responsible practices, the panel noted. But the challenge is there’s so much noise in the marketplace. Since much of the language found on labels is unregulated, terms like “natural” don’t mean anything and foster confusion.

“It’s really hard to sort through that as a consumer. All natural and organic isn’t always better. Sometimes using better processes will give you a better product with low environmental impact,” Daystar said. “It’s important to put numbers behind the claims.”

To provide clarity to what’s often a gray area, there are a lot of certifications out there that some brands use to prove they’re actually sustainable in one aspect or another. Unfortunately, consumers aren’t aware of what any of them mean. At least that’s what Cotton Incorporated’s research shows. “Consumers aren’t aware of things like GOTS,” said Melissa Bastos, Cotton Incorporated director of market research, who was also a presenter at the event. “They don’t have a deep understanding of things like that.”

Instead, she said, shoppers rely on hangtags and fiber content to make buying decisions. And often, cotton is what they’re looking for because they think it’s safe and natural.

Consumers’ shallow understanding of the fibers they’re choosing—let alone the processes and treatments related to them—feeds into common misconceptions, Bell said. “The challenge is that ‘organic’ is simple [as a concept] so they naturally assume it means something better than things that don’t say organic,” he said. “There’s a lot of confusion and misrepresentation.”

Daystar agreed, saying, “Organic might have some benefits but it can’t make up the same yield and it needs more water. Organic isn’t always better. Really growing cotton efficiently is better.”

The problem though is that you have only seconds at point of sale to capture consumers’ attention, so simple messages are the ones that stick. But there’s hope that consumers will catch on more over time. Daystar says Europe is at the forefront of sustainability awareness so its useful to look at their rate of adoption on a consumer level when trying to determine where the U.S. is headed.

“The millennials and Gen Z are going to expect [products] to do good for the same price,” Bell predicted. “The driver of sustainability is profitability. It’s all related to the green dollar bill. At some point it will be a cost of entry. You see that with customers in Europe.”

Already some consumers are aware of the finer points related to sustainability and they’re holding brands accountable. “Consumers are looking for credibility from the brands,” Bell said. “Consumers are looking for brands that are transparent and put the information out there.”

For its part, Gildan has developed an app through which shoppers can trace a T-shirt throughout its lifecycle. Similarly, Archroma’s new dyes are traceable, allowing consumers a similar level of transparency.

For the consumer who is this dialed in, Daystar says brands are responding.

“A lot of companies are looking at how can we make an opportunity out of being sustainable,” he said. “Also, avoiding risk is another motivator. They don’t want to have an issue with a new product later.”

Daystar also thinks that in the future environmental labeling will be regulated and ubiquitous.

Innovation impacts

While widespread consumer adoption might be lagging, that’s not slowing down innovation, primarily again because researchers and segments of the industry recognize the business benefits.

For instance, what if instead of bio-based dyes, it was possible to grow cotton in the colors you want? That’s not a farfetched idea, according to Dr. Keerti Rathore, a professor in the Department of Soil & Crop Sciences at Texas A&M University, who’s focused on generically modified plants.

In addition to boosting bottom lines and being kinder to the planet, Rathore’s research is looking at ways cotton could help solve the world food crisis. He’s working to reduce the levels of a certain toxin in the cotton seeds to make them edible. If successful, the 26 million metric tons of cotton fiber we produce each year could feed millions. “People require 15 grams of protein a day,” he said. “If you could apply [cotton seed] to human nutrition, you could feed 500 to 600 million people.”

Daystar said an achievement like that would be profound. “It’s important to think about sustainability [in terms of the] environment but also the people.”