Sustainable Supply Chain Practices in Fast Fashion Industry: An Analysis of the Impact and Future Perspectives

The need for sustainability is growing significantly in the fast fashion industry. This thesis explores how Ultra-fast fashion giants like Shein and Temu are performing compared to established fast fashion giants like C&A and H&M, in terms of measuring their supply chain's environmental, economic and social impacts. Additionally, the research examines how brands adhere to sustainability norms based on the GRI framework on Environmental, economic and social dimensions. Out of many, eight critical criteria, such as climate (GHG emissions), waste management, water management, workers' rights, community engagement, supply chain transparency, and innovation, were chosen as the basis of this study. The research assesses how well these businesses adhere to the sustainability norms using secondary data, i.e., the Sustainability Report published by respective companies. A narrative description of Sustainability, Supply Chain Management, Challenges and Barriers, the introduction of Fast fashion and the need for sustainability in fast fashion are included in the theory Literature.

The study points out that the C&A and H&M are adopting sustainability practices with strong commitments across all criteria. This leads the way for Shein and Temu to adapt their measures, as they show massive disparities in performing sustainability practices compared to C&A and H&M. The latter has to improve with transparency. The study emphasises broader outcomes for the industry stakeholders and pressures Fashion companies to adhere to international sustainability standards. It also shows the importance of investing deeply in the long-term effects of ultra-fast fashion on sustainability, specifically concerning labour exploitation and environmental damage. The thesis provides suggestions for sustainable transition within the fashion sector that align with international sustainability goals like the UN Sustainability Development Goals and the Paris Agreement.

Project Highlights:

Solution Components:

Conclusion:

In summary, the thesis investigated the sustainability approaches of Temu and Shein, the two ultra-fast fashion firms. It pointed out many shortfalls in areas like waste management, worker rights, transparency, and the impact on the climate. These results highlight the pressing need for ultra-fast fashion firms to implement more sustainable and ethical supply chain policies to satisfy the increasing demands of investors, regulators, and customers to manufacture ethical and ecologically friendly clothing.

Shein has started some efforts, especially in emissions reporting and recycling programs. Meanwhile, Temu keeps all sustainability-related information private. In addition to highlighting the potential for industry transformation, the comparison between Shein and Temu to crucial sustainability standards shows that many of the present programs are shallow and lack the comprehensive details and depth necessary to result in significant change. By pointing out the shortcomings in adopting sustainable methods into the conventionally unsustainable ultra-fast fashion supply chain, this thesis makes a contribution. It gives Shein and Temu practical advice on how to implement sustainable practices and maintain their competitiveness in a price-conscious market. Fashion companies can profit financially by implementing a few sustainability practices, such as adopting a circular economy model, transparent reporting, and integrating AI into manufacturing. But to genuinely achieve sustainability across its supply chain, ultra-fast fashion companies need to balance ethical responsibility and fnancial viability. The findings highlight the importance of collaborative efforts between brands and industry stakeholders like suppliers, customers, investors and regulators. Brands adopting these practices can reduce their environmental impact and enhance brand loyalty, also attract eco-conscious consumers. As recommendations for Shein and Temu, short-term, mid-term and long-term goals are provided to adopt sustainable practices across its supply chain.

Future research is advised to be conducted to overcome the limitations of this study and get a deeper understanding of consumer behaviour, regulatory effects, and sustainable practices in the context of rapid fashion. It should also explore the role of emerging technologies in improving supply chain transparency and sustainability. Ultra-fast fashion companies can continue evolving and aligning their business models with international sustainability goals to meet stakeholders’ demands for ethical and transparent operations by adopting these initiatives, as it is no longer an option but a necessity.

Suggestions for Future Research:

Suggestions for future research are based on the limitations and findings of the thesis; several directions for further research might deepen the understanding of sustainability in the ultrafast fashion sector. Future research should concentrate on primary data, such as gathering data by contacting employees, suppliers, and company representatives, in order to reduce dependency on secondary data and give access to current information about their strategies.

Much deeper research is necessary to gain a profound idea of how to compare initiatives among fashion models like fast, ultra-fast, and slow fashion brands. This comparison could reveal how different industries differ in terms of customer behaviour, financial viability and sustainability practices. It would be beneficial to evaluate the obstacles to implementing these recommendations and how cutting-edge technologies like Blockchain, Artificial Intelligence, and the IoT might improve overall resource efficiency and supply chain transparency.

Additionally, it would be interesting to analyse and investigate consumer behaviour toward sustainability efforts in terms of price sensitivity and brand loyalty and further investigate the influence of marketing strategies like sustainable purchasing and eco-labels.

This thesis recommended a circular economy in ultra-fast fashion, such as recycling and a resale program, which Shein partially implemented, but the details remain limited. Further Research could focus on the scalability of these models and examine how brands could transition to a closed-loop system. Since the topic is current, many more areas for evaluation could be followed.