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See: ‘Dressing Digitally’ Pins Hope With Blockchain To Clean Up Fashion’s Carbon Footprint | Crypto miles
The fashion industry is responsible for 8% of total carbon emissions – more than all international flights (2.5%) and international shipping (3%) combined. Can “digital wear” make a difference?
According to a United Nations report, the fashion industry is the second largest polluter in the world after the oil and gas sector.
In The Crypto Mile this week, Yahoo Finance heard from Louise Lain, founder of eco-minded fashion marketplace Phygaltwin.
Laing argues that Web3’s innovations will use blockchain-based solutions to streamline workflows and reduce waste by allowing customers to try on clothes in virtual environments before making a purchase.
She gave an example of the extent of the damage the fashion industry causes to the environment, saying, “Fashion brands overbuy raw materials by at least 30%, so in general, there can be 30 to 40% waste in every order a fashion brand makes.” .
“On top of that, 5% of the world’s waste is generated by the fashion industry,” she added.
‘Dressing Digitally’
Leung claims that using a combination of Web3 innovations can significantly reduce the amount of waste and carbon emissions produced by the fashion industry.
“At PhygitalTwin, we believe that using digital technology in 3D design will streamline the entire supply chain process.
“A fashion company allows you to use digital assets to test the market before physically producing the product,” Lang said.
She explained that producing digital versions of clothing lines allows consumers to overlay augmented reality (AR) on the clothing item before purchasing it in person.
Laing adds that recent Web3 technology advances such as Snap filters allow consumers to “digitally dress themselves” before making a physical purchase.
This can lead to low product returns, which is a major source of waste in the industry. According to a study conducted by ecommerce software company Shipo, 10% of clothing purchases are returned if consumers are dissatisfied with their purchase.
Average ecommerce return rates are said to be even higher, hovering around 20-30%.
“Fashion manufacturers can use these tools to see what your customers’ needs are before they go into production.
“This allows producers to work closer to the market in a more efficient and effective way,” Lang explained.
Blockchain and fashion supply chains
Proponents of Web3 technology tout blockchain technology as bringing multiple efficiencies to supply chains by increasing transparency, improving traceability, reducing paperwork, increasing efficiency, and improving security.
From raw material manufacturers to high street stores, Laing suggests that efficiencies can be found across all fashion supply chains by digitizing inventories and tokenizing them on the blockchain.
This enables real-time tracking of supply and demand around the world.
And, with corporations looking to meet environmental, social and governance (ESG) targets, this creates an ongoing record to assess the ethical and environmental impact of the origin, location and movement of goods.
When it comes to textiles and clothing, H&M ( HM-B.ST ) said it is committed to 100% sustainability by 2040, and Levi’s says it will reduce greenhouse gas emissions in its global supply chain by 40%.
“With blockchain, you can transparently track every step of the supply chain.
“You can show the water usage and how much CO2 emissions were released to produce that product, where the fabric was grown, where it was made, a digital label that shows the source of the product, just like on food,” Laing added.
Blockchains and and fake fashion items
Tracking and recording every transaction in the supply chain will greatly improve industry efficiency and reduce the risk of fraud as blockchain ledgers are transparent for all to see.
Fraud is a huge problem for the fashion industry, according to Statista, the fashion industry lost more than $50 billion to counterfeit products in 2020 alone.
By providing a transparent and secure supply chain, blockchains can help protect fashion brands’ intellectual property, improve consumer trust, and reduce the amount of counterfeit goods in circulation.
“Blockchain allows you to have complete transparency and efficiency. If a fashion brand releases a certain version, say one out of 50, then you can see through the blockchain when a buyer gets their product, it’s actually one out of 50.” Laing explained.
Products on the blockchain can be verified by assigning a unique digital tag to each batch or product.
This identification makes it possible to track the product’s journey from the manufacturer to the retailer and easily identify counterfeit products.
The so-called “phytial” authentication is a solution to combat counterfeiting and also to ensure that fashion brands exist in both the physical and virtual worlds.
Clothing items are sold with a QR code linked to a non-fungible token (NFT) stored on the blockchain.
This verifies goods using end-to-end encrypted blockchain systems and allows clothing to have a second life at scale.
This new “phytial” paradigm has designs to change the fashion industry.
“When you buy something on PygitalTwin, you get the opportunity to redeem the physical garment, but also the NFT, which is printed on the garment as a QR code.
Fashion’s huge carbon footprint
Clothes are worn for years, repaired when damaged, not thrown away, items associated with the character of the people who wear them.
But now, most of the production activity in the fashion and apparel industry is to provide high-volume, quick-change, low-cost clothing that people only wear for a few months.
This high level of production has affected the global environment. The fashion industry is currently the second largest polluter in the world, behind only mining, according to a report by The Global Fashion Agenda.
The industry is responsible for 1.2 billion tonnes of carbon emissions per year, with each UK household producing the equivalent emissions of driving a modern car for 6,000 miles, due to clothing consumption.
Whether Web3’s innovations will be widely adopted by the fashion industry remains to be seen, but global industry and financial leaders are beginning to take ESG obligations seriously. Using blockchain to automate many of the efficiencies needed to reduce carbon emissions will be even more attractive.
See: Why More Women Should Embrace the Stock Market Founder’s Daughters | Crypto miles
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