What: The article highlights the broken system of fashion manufacturing and the challenges it poses.

Why it is important: It is important to address the broken system of fashion manufacturing and overcome its challenges in order to create a more sustainable and efficient industry that benefits all stakeholders involved.

One example is Ahmed Zaidi's family's apparel factory in Pakistan, which experienced order cancellations from brands, resulting in difficulties paying suppliers. The breakdown between brands and their selling channels further exacerbates the problem. Mainstream stores carry excessive amounts of inventory, leading to messy displays and poor consumer experiences. This overproduction and inventory problem are driven by pressure from fashion investors and result in discounting cycles that compromise brand values.

French luxury conglomerates and small independent retailers have found success by adopting different approaches. The broken wholesale fashion system affects brands, manufacturers, and retailers alike. Manufacturers face canceled orders and payment difficulties, while mainstream stores struggle with excess inventory. Investment capital can influence brand values and sustainability goals. Nonetheless, some brands are finding success by controlling the entire production and distribution chain or through extreme cooperation. Small independent retailers thrive by carefully curating their inventory and maintaining strong partnerships with the brands they sell.

Many smaller labels view wholesale as a marketing tool to introduce their brand to new shoppers, generate cash flow, and support production. During the pandemic, some designers, such as Hoffman, shifted their sales strategy from wholesale to direct-to-consumer. However, they still aim to bring on more wholesale accounts to achieve a balanced sales percentage.

In the wholesale system, smaller independent brands face challenges and costs such as using costly order technology and marketing support fees. To improve the wholesale cycle's efficiency and profitability, researchers are exploring the use of artificial intelligence and fabric/materials arbitrage.

The US wholesale model is hurting everyone