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8 Reasons to Rethink Fast Fashion

8 Reasons to Rethink Fast Fashion

Not too long ago, fast fashion megastore Forever 21 announced plans to launch a new brand called F21 Red. Already known for low prices, these stores would offer clothing at costs that make Goodwill seem pricey — jeans for $7.80, tanks from $1.80 to $3.80. How can a retailer sell jeans for $7.80 and still make money? You don’t want to know, but it’s vital that you find out. All of those inexpensive finds might seem easy on your budget, but the world is paying a high price for fast fashion.

1. Fast fashion exploits overseas workers.

Remember the boycotts against the Gap and Nike back in the 90’s for using sweatshop labor? Today, business practices have gotten even shadier — and perhaps because clothes are cheaper, shoppers seem to care even less. Fast fashion stores are particularly culpable here, due to their drive for lower-than-ever prices and the frequency of their demand for new goods.

Back in the day, companies ordered clothes for each season. (This is still the way most high fashion labels work — the clothes that are on the New York runways in October showcase what will be available for spring of the following year.) Garments might take up to a year to actually be produced, and if an apparel company wanted something faster, they’d have to pay up.

Now, fast fashion chains like H&M and Zara introduce new styles as often as every two weeks. Practically as soon as photos from fashion week go up online, there’s an immediate chain reaction of fast fashion stores rushing to duplicate the trend. How do they do it? By subcontracting manufacturing overseas to the lowest bidder — generally in countries that already have some of the leanest production costs on earth. Rather than having long-term relationships with the factories, companies are comfortable with abrupt break-ups — so if they want something faster, the factories have to keep up or lose their contracts.

The push to quickly create clothing that costs buyers as little as possible leads, predictably, to factories that put production schedules and companies’ demands ahead of safety or workers’ rights. This was highlighted by the catastrophic Dhaka fire in 2012 and the 2013 Rana Plaza building collapse, which killed a combined total of over 1,200 Bangladeshi apparel workers and injured many more. The faulty wiring, lack of exits, crowded conditions, and poor construction are reminiscent of New York City’s Triangle Shirtwaist Fire. But that happened in 1911. It’s 2014.

Why is so much clothing manufacturing is going on in Bangladesh? Mainly because rising wages and inflation in China have made producing clothing there prohibitively expensive for manufacturers who seek to feed U.S. tastes for ever cheaper clothing. It won’t stop there, either — U.S. News recently reported that the Gap is looking to move some production to Myanmar (a country not exactly known for a stellar human rights record), and H&M is expanding to Ethiopia.

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2. Fast fashion contributes to the decline of U.S. manufacturing.

Politicians and pundits often the lack of U.S. manufacturing jobs that pay a living wage, allowing people who maybe don’t have a college degree to support themselves and their families. When people ask where the “good jobs” have gone, one answer is well, we can’t have decently-paid factory work and shirts that cost less than $5.

According to Northern California public radio station KQED, in the 1960’s — when roughly 95% of clothing manufacturing was made in the United States — the average American household spent over 10% of its income on clothing and shoes (like $4,000 in today’s dollars). Your average American shopper bought fewer than 25 garments per year.

Now, all of those figures have flipped. Today, less than 2% of all clothing is manufactured in the U.S. The average household spends less than 3.5% of its income on clothing and shoes (less than $1,800). The most shocking number: Now, your average American shopper is buying roughly 70 garments per year. That’s nearly 3 times as many items as 50 years ago — and yet our annual household spending comes out to less than half of the amount spent in the 60’s.

Though clothing design and marketing still generally happens in the U.S., from the 1970’s onward more and more apparel manufacturing went overseas (and in case you forgot how that went, scroll back up to item one on this list). To maintain their profit margins while feeding appetites for inexpensive clothing, manufacturers have country-hopped to wherever can provide the lowest costs. You can guess how well U.S. factories have fared. Given the higher cost of manufacturing in the states, today only about 150,000 apparel manufacturing jobs remain. Those workers make about 38 times the wage of their Bangladeshi counterparts, so yes, clothing that is legitimately American-made is not going to be that cheap.

3. Fast fashion also exploits U.S. workers.

That said, apparel manufacturing in the U.S. isn’t all decent wages and reasonable working conditions. It’s mostly neither of those things. Sweatshops absolutely exist, particularly in large cities like New York and Los Angeles, and it’s not uncommon for these to be contractors manufacturing clothing on behalf of fast fashion chains.

In particular, fast fashion behemoth Forever 21 has been the subject of several lawsuits related to conditions in Los Angeles factories that make their clothing (there’s even an Emmy-winning documentary, Made in LA, that looks at the struggles of the immigrant workers to gain basic rights). The New Yorker reports that in 2001, the company was sued on behalf of workers who worked well over full time while earning much less than minimum wage in grotesque conditions. How did the clothing chain respond? They said they couldn’t be held responsible for their contractors’ practices and filed defamation lawsuits against the groups that organized boycotts of the stores. (The dispute was eventually settled with the company agreeing to help activists but refusing to admit wrongdoing.)

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But then virtually the same allegations cropped up in 2012, this time brought about following a multi-year investigation by the Department of Labor into Los Angeles sewing factories. The federal court issued a subpoena, then sued, then ordered Forever 21 to hand over records documenting workers’ hours and compensation. The workers in these factories are often unskilled recent migrants, who may be undocumented and/or unable to speak English. Their precarious status is something that unscrupulous manufacturers can exploit — and that’s how you they can be paid even less per hour than the cost of your $5.80 miniskirt.

4. Fast fashion is environmentally disastrous.

“Buying clothing, and treating it as if it is disposable, is putting a huge added weight on the environment and is simply unsustainable,” says Elizabeth L. Cline, author of Overdressed: The Shockingly High Cost of Cheap Fashion. In her book, Cline documents the numerous tolls that textile manufacturing takes on the earth. Though in the U.S., textile manufacturing faces greater regulation to make it less destructive, again, most of the manufacturing takes place overseas where there is much less oversight. Cline cites the stat that fiber production now takes roughly 145 million tons of coal and between 1.5 and 2 trillion gallons of water.

But it’s not just the resource strain caused by manufacturing — it’s also the issues at the other end, of people constantly getting rid of their used (or even unused) clothing. The Huffington Post reports that the average American throws out 68 pounds of textiles per year — not donates or consigns, straight-up throws in the trash. In case the sheer wastefulness isn’t galling enough, bear in mind that because most garments (especially fast fashion ones) are made with inexpensive, petroleum-based fibers that don’t easily decompose (such as polyester, nylon, and acrylic), they’re going to be taking up landfill space for decades to come. As Cline points out, people generally recycle plastic bottles or avoid buying them in the first place, but people are pretty okay with buying lots of plastic clothing.

Even if you donate used clothes to charity, at this point nearly half of all charitable donations go directly to textile recyclers. On the one hand, yes, a large portion of this is reused in different ways (recycled fibers can be used in stuff like insulation). On the other hand, though, it’s unbelievably wasteful. There’s the use of water, coal, and so on in the manufacturing process. But then there’s also the “downstream” costs, including to the charities themselves, which are forced to spend a considerable amount of money sorting through clothing they can’t use (like ripped, torn, or soiled items) and disposing of it. Fast fashion has even made the textile recycling business more difficult — the lower quality of the clothing, Cline reports, means that recycled fiber is often sold below cost (and for the record, recycled fiber is sold for less than a nickel a pound).

H&M has been faced especially heavy criticism for its espousal of “disposable fashion,” and has done more than other stores to combat that image. They have released the “Conscious Collection,” billed as “sustainable style” and featuring items like a $7.95 tank top made with organic cotton. H&M also now boasts a selection of “premium quality products” (like $99 cashmere cardigans) which cost more and are ostensibly longer-lasting. They’ve also started putting recycling bins right in their stores, which will accept used clothing in any condition.

It’s a nice gesture, but at times the company’s attempts at proving its ethics are ludicrous. For example, H&M has a sponsored story titled “Fast fashion doesn’t automatically mean unsustainable” published in the UK’s Guardian (styled to look like legitimate site content, but paid for, branded, and no doubt heavily vetted by H&M). In the story, the author argues, “…everyone in the fashion industry knows that luxury brands and high street brands more than occasionally use the same suppliers. Factory workers are paid the same salary to produce luxury goods as so-called ‘fast fashion’, and under the same conditions.”

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To recap then, their argument is that factory workers will be exploited no matter what, so might as well go with the cheaper pair of leggings. You can tell yourself that well, you’ll give those leggings to charity, and then someone else will wear them, but given the lower quality and cheap brand, they’re more likely to wind up in a landfill than on somebody else’s legs.

5. Fast fashion can wind up costing you more than “real” clothes.

If you’re on a budget and looking for ways to save money on clothes, one way to evaluate the price of an item is to calculate the cost per wear for each item. You could complain that this is just a trick to make an expensive item seem reasonable, but it’s actually a way to force yourself to think about the effects of your purchase on your bottom line. You need to think about both how often you’ll wear the item, and how long it will likely last.

Say you’re looking for a pair of black heeled sandals. You can buy a pair from Charlotte Russe for about $30. If you wear them just to one party buy them for a special occasion and wear them just for that, that’s your cost per wear right there — $30. Wear them three times, it’s $10. If the cheap pleather cracks, if the heel breaks, if the plastic soles are too worn, that’s the end of the road for those heels. If you’re going to replace them with a new pair, that’s another $30. It would be easy to wind up spending $120 per year on four pairs of the same cheap black heels, with a cost per wear of roughly $10.

Now here’s a different scenario. We’re still looking for black heeled sandals, but say you get them from Cri de Coeur. Founded by two Parsons grads, their vegan, sustainably-produced, and totally stylish shoes retail for around $150 for a pair of heeled sandals. If you wear them the same amount as the cheap heels, they’re only costing you a little bit more per wear — $12.50. But since these are considerably higher quality and will hold up much better, you’re probably going to wear them more. Even if you only wore them 16 times in one year, your cost per wear would drop below the $10 mark. You also don’t need to make those three additional trips to the mall to replace your busted-up heels. Which scenario seems more sensible?

6. Fast fashion’s low quality changes how you think about clothes.

Ellen Ruppel Shell, author of Cheap: The High Cost of Discount Culture, argues that when we buy “cheap chic” clothes at places like Target or Mango, even though there’s not planned obsolescence — the clothing isn’t designed to fall apart (though some have alleged that it is) — we don’t expect it to last. We don’t invest much in it monetarily or emotionally, it’s just to fill the gap (something to wear to that party Friday night) and then its job is done. Part of why Americans toss so much clothing is because we no longer bother to repair a lost button, or resole a worn-out shoe. If clothing feels cheap, fast, and disposable, that’s how we treat it.

In an article on the website College Fashion, after explaining “how Forever 21 works” (i.e., mentioning that unethical labor practices help keep prices low), the author goes on to give tips for shopping at the retail chain. For example, look at the seams: “If the two sides of the seam appear to come apart relatively easily, the thread starts to come undone, or you feel that with a little bit more energy you could rip the item in half, it’s not made well and won’t hold up for long.” Why would you shop in a store where the item literally falling apart in your hands is a likely scenario?

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Cline, author of Overdressed, also notes this phenomenon. She writes that “low prices and fast trends have made clothing throwaway items, allowing us to set aside such serious questions as How long will this last? or even Will I like it when I get home?” For many people, even bothering to return an item that looks less good outside the store is too much of a hassle. But cheap isn’t free. If you’re going to toss your clothes after one wear, you’re throwing money away, too.

7. Fast fashion collaborations trick you into paying for the name.

What used to be mega-events — round-the-block lines for Karl Lagerfeld for H&M, Missoni for Target crashing the big box retailer’s website — are now regular occurrences. Mass market retailers (notably Target and H&M, but also Mango, Topshop, and Zara) regularly trot out collaborations with high fashion designers, giving consumers a taste of what H&M has dubbed “massclusivity,” according to Dana Thomas, author of Deluxe: How Luxury Lost Its Luster. These limited-time capsule collections are designed to do pretty much one thing — send shoppers into a buying frenzy where they don’t even care what they get, they just know they’re getting something with the designer’s name on it.

Sure, that’s not how these brands would describe it. Thomas quotes Chanel designer Karl Lagerfeld as saying that fashion isn’t a matter of price, “It’s all about taste.” But how tasteful is waiting in line outside a mall store or constantly hitting refresh on your web browser just to grab something, anything that has a designer’s name on it? Considering that many fashionistas claim that it’s not about the label, it’s about the style, it’s more than a little surprising that these collaborations consistently create such buzz (Joseph Altuzarra coming to Target this fall is all over every fashion mag’s September issue).

Once the thrill of the initial scrum is over though, shoppers are left with items that say Missoni, or 3.1 Philip Lim, or Rodarte, or whichever designer they are. But are they really? Cline notes that actual Missoni dresses, for example, are made in Milan using natural fibers like virgin wool, viscose, and alpaca. Missoni for Target? That would be acrylic made in China. You could argue you’re paying for the design, but realistically, anyone who recognizes the designer is probably also going to recognize that you’re wearing the H&M version, not the real deal. Sure, it’s a lot less than a “real” item from one of these designers would cost… but chances are, it’s also something you wouldn’t even have considered buying if it didn’t have the designer’s name attached.

8. Fast fashion distorts your sense of value.

Though Americans like saving a buck — honestly, who doesn’t? — with the rise of fast fashion, we expect our clothing to cost virtually nothing. The strange thing is that even though we appreciate lower prices on all goods, we’re pretty willing to pay more for certain types of products. Some of the most desirable products — like Apple computers — are literally unavailable at a discounted price, and people still line up every time there’s a new iPhone. A computer or a smartphone is an investment and lasts a while, but think about other things in your life you’re willing to pay a bit more for. A grande latte at Starbucks costs around $4, and you drink it in a matter of minutes (or if you sip, we’ll call it an hour). If you’ll spend $4 on a bit of caffeination, is it really that important that a t-shirt cost only $3? The money you’re saving on that shirt has real consequences — it’s worth the time to reflect on what it truly costs.

Featured photo credit: Mike Mozart via flickr.com

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Last Updated on August 20, 2019

How to Set Financial Goals and Actually Meet Them

How to Set Financial Goals and Actually Meet Them

Finances can push anyone to the point of extreme anxiety and worry. Easier said than done, planning finances is not an egg meant for everyone’s basket. And that’s why most of us are often living pay check to pay check. But did anyone tell you that it is actually not a tough task to meet your financial goals?

In this article, we will explore ways on how to set financial goals and then actually meet them with ease.

5 Steps to Set Financial Goals

Though setting financial goals might seem to be a daunting task but if one has the will and clarity of thought, it is rather easy. Try using these steps:

1. Be Clear About the Objectives

Any goal (let alone financial) without a clear objective is nothing more than a pipe dream. And this couldn’t be more true for financial matters.

It is often said that savings is nothing but deferred consumption. Therefore if you are saving today, then you should be crystal clear about what it is for. It could be anything like kid’s education, retirement, marriage, that dream vacation, fancy car etc.

Once the objective is clear, put a monetary value to that objective and the time frame. The important point at this step of goal setting is to list all the objectives, however small they may be, that you foresee in the future and put a value to it.

2. Keep Them Realistic

It’s good to be an optimistic person but being a pollyanna is not desirable. Similarly, while it might be a good thing to keep your financial goals a bit aggressive, going out of the line will definitely hurt your chances of achieving them.

It’s important that you keep your goals realistic in nature for it will help you stay the course and keep you motivated throughout the journey.

3. Account for Inflation

Ronald Reagan once said – “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hitman”. And this quote sums up the best what inflation could do your financial goals.

Therefore account for inflation whenever you are putting a monetary value to a financial objective that is far away in the future.

For example, if one of your financial goal is your son’s college education, which is 15 years hence, then inflation would increase the monetary burden by more than 50% if inflation is mere 3%. So always account for inflation.

4. Short Term vs Long Term

Just like every calorie is not the same, the approach towards achieving every financial goal will not be the same. It is important to bifurcate goals in short term and long term.

As a rule of thumb, any financial goal, which is due in next 3 years should be termed as short term goal. Any longer duration goals are to be classified as long term goals. This bifurcation of goals into short term vs long term will help in choosing the right investment instrument to achieve them.

More on this later when we talk about how to achieve financial goals.

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5. To Each to His Own

The journey of setting financial goals is an individualistic affair i.e. your goals are your own goals and are determined by your want to achieve them. A lot of times we get on the bandwagon of goal setting only to realize later on that it was not meant for us.

It is important that your goals are actually your goals and not inspired by someone else. Take a hard look at this step at all the goals you’ve set for after this step, you will be on the way to achieve them.

By now, you would be ready with your financial goals, now it’s time to go all out and achieve them.

11 Ways to Achieve Your Financial Goals

Whenever we talk about chasing any financial goal, it is usually a 2 step process –

  • Ensuring healthy savings
  • Making smart investments

You will need to save enough; and invest those savings wisely so that they grow over a period of time to help you achieve goals. So let’s get down to ensuring healthy savings.

Ensuring Healthy Savings

Self realization is the best form of realisation and unless you decide what your current financial position is, you aren’t heading anywhere.

This is the focal point from where you start your journey of achieving financial goals.

1. Track Expenses

The first and the foremost thing to be done is to track your monthly expenses. Use any of the expense tracking mobile apps to record your expenses. Once you start doing it diligently, you would be surprised to see how small expenses add up to a sizeable amount.

Also categorize those expenses into different bucket so that you know which bucket is eating the most of your pay check. This record keeping will pave the way for cutting down on un-wanted expenses and pump up your savings rate.

2. Pay Yourself First

Generally, savings come after all the expenses have been taken care of. This is a classical mistake which almost everyone of us do. We pay ourselves last!

Ideally, this should be planned upside down. We should be paying ourselves first and then to the world i.e. we should be taking out the planned saving amount first and then manage all the expenses from the rest.

The best way to actually implement is to put the savings on automatic mode i.e. money flowing automatically into different financial instruments (for example – mutual funds, retirement corpus etc) every month.

Taking the automatic route will make us lose control of our money and hence will compel us to manage in what’s left with us thereby increasing the savings rate.

3. Make a Plan and Vow to Stick with It

Budgeting is the best to get around the uncertainty that financial plans always pose. Decide in advance how spending has to be made.

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Nowadays, several money management apps and wallets can help you do this automatically. It’s easy and who knows, you may just end up doing what people fail to do.

At first, you may not be able to stick to your plans completely but don’t let that become a reason why you stop budgeting entirely.

Make use of technology solutions you like. Explore options and alternatives that let you make use of the available wallet options and choose the one that suits you the most. In time, you will get accustomed to making use of these solutions.

You will find that they make it simpler for you to follow your plan, which would have been difficult otherwise.

4. Rise Again Even If You Fall

Let’s be realistic. It’s not like the world will come to an end if you made one mistake. This isn’t called leniency but discipline.

If you fail to meet your budget for a month, don’t give up the entire effort just like that. Instead, start again.

Remember that flexible plans are the most realistic plans. So go forward and try to follow your financial goals as planned but if for some reason, the plan gets out of hand for you, do not give up on it just yet. This has a lot to do with your psychology rather than any material commitment.

All you have to do is to stay on the road and vow to stay on it, no matter how much you fall down.

5. Make Savings a Habit and Not a Goal

In the book Nudge, authors Richard Thaler and Cass Sunstein advocate that in order to achieve any goal, it should be broken down into habits since habits are more intuitive for people to adapt to.

Make Savings a habit rather than a goal. While it might seem to be counter intuitive to many but there are some deft ways of doing it. For example:

Always eat out (if at all) during weekdays rather than weekends. Usually weekends are expensive. Make it a habit and you would in turn be saving a great deal.

If you are travelling buff, try to travel during off season. Your outlay will be much less.

If you go out for shopping, always look out for coupons and see where can you get the best deal.

So the key point is to imbibe the action that results in savings rather than on the savings itself, which is the outcome. Focusing on the outcome will bring out the feeling of sacrifice which will be harder to sustain over a period of time.

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6. Talk About It

Sticking to the saving schedule (to achieve financial goals) is not an easy journey. There will be many distractions from those who are not aligned with your mission. And it would be rather easy to lose the grip over your discipline.

Therefore in order to stay the course, it is advisable that you keep yourself surrounded with people who are also on the same bandwagon. Daily discussions with them will keep you motivated to move forward.

7. Maintain a Journal

For some people, writing helps a great deal in making sure that they achieve what they plan.

So if you are one of them, maintain a proper journal, where you write down your goals and also jot down the extent to which you managed to meet them. This will help you in reviewing how far you have come and which goals you have met.

Use this journal to write down all essential points such as your short term, mid term and long term goals, your current sources of income, your regular expenses which you are aware of and any committed expenses which are of recurring nature.

When you have a written commitment on paper, you are going to feel more energised to follow the plan and stick to it. Moreover, it is going to be a lot more easier for you to follow you and track your progress.

At this point, you should be ready with your financial goals and would be doing brilliantly with savings; now it’s time to talk about the big daddy – Investments.

Making Smart Investments

Savings by themselves don’t take anyone too far. However savings when invested wisely can do wonders and we are at that stage where we will talk about making smart investments.

8. Consult a Financial Advisor

Investments doesn’t come naturally to most of us therefore rather than dabbling with it ourselves, it is wise to consult a financial advisor.

Talk to him/her about your financial goals and savings and then seek advice for the best investment instruments to achieve your goals.

9. Choose Your Investment Instrument Wisely

Though your financial advisor will suggest the best investment instruments, it doesn’t hurt to know a bit about them.

Just like “no one is born a criminal”, no investment instrument is bad or good. It is the application of that instrument that makes all the difference.

Do you remember we talked about bifurcating financial goals in short term and long term?

It is here where that classification will help.

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So as a general rule, for all your short term financial goals, choose an investment instrument that has debt nature for example fixed deposits, debt mutual funds etc. The reason for going for debt instruments is that chances of capital loss is less as compared to equity instruments.

10. Compounding Is the Eighth Wonder

Einstein once remarked about compounding,

Compound Interest is the eighth wonder of the world. He who understands it, earns it… He who doesn’t… Pays it.

So make friends with this wonder kid. And sooner you become friends with it, quicker you will reach closer to your financial goals.

Start investing early so that time is on your side to help you bear the fruits of compounding.

11. Measure, Measure, Measure

All of us do good when it comes to earning more per month but fail miserably when it comes to measuring the investments; taking stock of how our investments are doing.

If there is one single step where everything (so far) can go wrong, it is at this step – Measuring the Progress.

If we don’t measure the progress timely, then we would be shooting in the dark. We wouldn’t know if our saving rate is appropriate or not; whether financial advisor is doing a decent job; whether we are moving closer to our target or not.

Do measure everything. If you can’t measure it all yourself, ask your financial advisor to do it for you. But do it!

The Bottom Line

This completes the list of tips for you to set financial goals and actually achieve them with not so great difficulty.

As you can see, all it requires is discipline. But guess that’s the most difficult part!

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Featured photo credit: rawpixel via unsplash.com

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