This content was developed in collaboration with Fashion for Good.
Materials lie at the heart of the fashion industry. They account for 92% of the industry’s total emissions through their extraction, processing, and production, and around 30% of cost of goods sold (COGS).
A new report, Scaling Next-Gen Materials in Fashion: An Executive Guide, reveals that next-gen materials could represent 8% of the total fiber market by 2030, equivalent to approximately 13 million tons. Although a vast improvement from just 1% of the fiber market today, this growth may still fall short of industry demand due to mounting regulatory pressures, climate-related supply chain disruptions, and evolving consumer preferences.
The strategic adoption of next-gen materials could lead to an approximate 4% reduction in COGS over five years compared to inaction. This demonstrates the importance of transitioning to these materials for brands aiming to maintain their competitive edge.
Scaling with Three Levers
The scaling of next-generation materials is hindered by financial, technical, and operational obstacles. This report provides a strategic plan for industry leaders to navigate these challenges, emphasizing the need for both individual brand action and industry-wide collaboration. Three primary levers are identified for scaling next-gen materials and reducing the cost of transition:
- Demand. Consistent demand signals stabilize markets; demand pooling and transition financing can overcome adoption barriers.
- Cost. Cost engineering and process optimization across the supply chain unlock economies of scale, driving affordability and adoption.
- Capital. Strategic financing aligned with each phase of the adoption curve ensures sustained growth and scaling potential.
This report, based on industry best practices and the successes of early movers, presents brands with a structured framework to act on these key levers and a pathway to address pressing challenges while driving measurable results.
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Successful implementation necessitates the integration of next-gen materials into core business strategies—aligning with financial goals to secure resources and drive accountability. This requires a comprehensive understanding of the current material mix, supply chain, and external ecosystem to mitigate risks and capitalize on opportunities for long-term resilience.
Once the foundation is in place, brands are positioned to activate the three levers—demand, cost, and capital—to drive scale and effectively bend the next-gen materials cost curve. This transformation can be achieved through individual or collective efforts with other brands and suppliers, or a combination of both approaches for maximum impact.
The time to act is now. The next-gen materials revolution is more than a challenge—it’s an unprecedented opportunity to lead. Brands that adopt next-gen materials today will not only unlock financial benefits (up to 4% of COGS savings within 5 years vs inaction) and drive long-term value but also position themselves as leaders in an evolving landscape.
