Mass customization can make fashion more sustainable if customers are willing to wait for it

The fashion industry produces far more supplies than it sells, consumes and pollutes more of the planet’s resources than necessary and produces approx. 10% of the world’s greenhouse gas emissions. Much of this excess merchandise ends up in landfills or is burned, prolonging the environmental assault.

Mass customization, where customers order clothes made to their own taste and style size, has been proposed as one solution to overproduction. But the logistical challenges of tailoring clothing to individual customer demands and long production times have discouraged most companies from adopting mass customization. They may want to reconsider that decision, according to a new study co-authored by a UC Riverside researcher. Upcoming in Manufacturing and Service Operations Management, studies show that under the right circumstances, mass customization can lead to higher profits and significantly reduced environmental waste.

Customers willing to wait for bespoke clothing from companies that mass-produce and mass-tailor clothing can make the fashion industry more eco-friendly, but only if overproduction is a real problem, reports learningco-written by Cool Orsdemir, a professor of operations and supply chain management at UCR’s School of Business. Government policies that make recycling or disposal more expensive for companies increase the sustainability effect in certain situations.

Orsdemir and co-author Aydin Alptekinoglu at Pennsylvania State University developed an analytical model of a mass-produced company that went into a hybrid by also adopting mass customization. Researchers model the product variety, price, and inventory decisions a firm makes to maximize its profits.

They found that when customers could be persuaded to wait longer for tailored clothing, the benefits of mass customization increased markedly. The benefits also clearly increase when policymakers target high disposal costs or expensive recycling programs at companies with low product variation costs, such as fast-fashion brands such as H&M, to prevent overproduction and target companies with high product variation costs, such as some big luxury brands, to acquire technology that will make recycling profitable.

In some cases, the conflicting demands of mass production and mass customization cause companies to overproduce. For example, a hypothetical denim company produces a number of jeans that typically sell out each season. Some people turn to the habit, increasing overall production and exacerbating environmental impacts. For hybrid mass customization and mass production to be profitable for the company as well as beneficial for the environment, companies need to strike a balance between the two modes of production.

“If you can promote it as a sustainable way to produce fashion items and increase customer patience in waiting, mass customization will most likely be profitable,” Orsdemir said.

However, before adopting mass customization, companies need to consider that the practice could eventually make overproduction worse and sustainability an even more elusive goal than it already is.

“Mass adjustments can help or harm,” Orsdemir said. “The bottom line is that it really helps when there’s a lot of overproduction. Mass customization can improve that. But when overproduction is not a problem, mass customization can exacerbate overproduction.”

Although their work focuses on the fashion industry, the authors argue that their findings can also be applied to other industries where overproduction creates environmental problems.

The paper, “Is adopting mass customization the path to eco-friendly fashion?” has been accepted for publication in Manufacturing and Service Operations Management, the top journal hosted by INFORMS and available on the SSRN preprint server here.

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