Business Research 1

Business Research

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14th November 2021

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Executive Summary

People are becoming more aware of the environmental impact of what they wear and how it

is made. As a result, they are choosing to buy less but better quality clothing, buying second-

hand clothes and wearing one thing for longer before throwing it away. Keeping this in mind

a plan has been written in detail that proposes to launch a sustainable clothing line called

Beach House. The brand aims to provide clothing that is sustainable and yet luxurious.

The purpose of the report is to help the brand introduce versatile clothing that is sustainable

and yet gives a look of luxury. The report contains data collected from numerous statistics

databases, books and journals and it has attempted to study the market of sustainable fashion

in the UK, present a detailed analysis of the business and the market where they operate.

Introduction 2
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Research Conducted 3
Business Analysis 3
Overview of the Business 3
Brand Mission 3
Brand Vision 4
Market Analysis of Sustainable Fashion in the UK 4
Market Size and Growth 4
Demand Analysis 5
Developments Due to Changes in Demographics 6
Competitor Analysis 6
Brand Analysis 7
Product Analysis 8
Financial Analysis 9
Operational Analysis 9
Conclusion 10
References 11

Introduction

Sustainable fashion is a new approach to fashion, and the fashion scene in the United

Kingdom is taking steps to reduce the environmental price tag of the industry. The UK
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fashion industry is working toward a solution that will benefit the environment and also

enhance wardrobes. The new movement in sustainable fashion is the latest trend, and it has

arisen because of concern over the environmental price tag attached to the traditional fashion

industry.

Beach House aim to become such a sustainable brand that manufactures its pieces using

super-soft organic cotton, linen and viscose to give a comfortable feel all day long. The

dresses themselves are clean, simple, graceful and elegant. The brand will take advantage of

its organic fabrics to create pieces that are soft to the touch, fluid in their movement and very

comfortable to wear. This study is an attempt to understand where Beach House will stand as

a brand in the British market and the feasibility for the growth of sustainable clothing in the

UK.

The primary research of this report consisted of fashion journals, market reports, and online

surveys. The secondary research was done with help of material found in the archives of the

internet, recent interviews and news reports.

Overall the research was well polished and faced very few limitations. One of them that

affected the research a little bit was getting a proper response from the public about the

sustainable fashion market and the brands that operate in it.

Research Conducted

Primary Research- This included information gathered from fashion journals, consumer

surveys, market reports, and online databases.

Secondary Research- This included information from materials found on the internet,

interviews and news archives.

Qualitative Method- Analysis of news reports, interviews, information from fashion journals

and webpages of the brand.

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Quantitative Method- Research was done with the help of the data gathered from online

surveys and market reports.

Business Analysis

Overview of the Business

Planned to be launched this year, Beach House is a brand that aims to create minimalist

capsule wardrobes curate a selection of contemporary threads and redefine basics. The

clothes are to be designed using sustainable methods and ethical practices. The brand also

plans to donate one-third of the profits to charities that are working for a sustainable future.

Brand Mission

To empower women through ethical fashion by offering a range of natural & organic fabrics,

whilst supporting the slow fashion movement. By building resilience, pledging to donate 1%

of profits to good causes and committing to educate the consumer, Beach House aims to

provide women with luxury ethical fashion showing that slow fashion is achievable.

Brand Vision

To create a new paradigm for clothing, from design to production, rooted in a respect for a

healthy planet and all of its inhabitants and bring together global craftsmanship with nature,

to create timeless beauty with an ethical touch, to be the cause of positive change.

Market Analysis of Sustainable Fashion in the UK

Ethical fashion as a concept aims to tackle the contrasting approaches within the industry –

that of developing brands with a conscience and those working on a quick turnaround at

prices that people can afford (Lai et al., 2017). With minimalism and ethical practices

becoming more and more mainstream, there is a growing interest in ethically sourced

products and the modern consumer has become much more informed and concerned about

environmental issues (Common Objective, 2018). Ethical fashion is considered the fastest-
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growing segment of the clothing industry. It is estimated to have grown by 18% during 2012

with an additional 24% in 2013 (Radonic, 2021). It continues to grow due to consumers

wanting to know where their clothes are coming from and if the materials are sustainable.

The biggest change in ethical fashion has been the rise of e-commerce due to this trend it is

estimated that a big of all clothing sales in 2022 will be online (Radonic, 2021).

Market Size and Growth

By 2021, the global ethical fashion market is expected to reach $7.6 billion (Shahbandeh,

2021). The market has increased at a compound annual growth rate of 8.7% from 2015

through 2019. Over the next five years, it is expected that the market to grow from $6.3

billion in 2019 to $8.2 billion in 2023 (Shahbandeh, 2021). Analysts have estimated that the

sustainable fashion market to grow from $6.3 billion in 2019 to $8.2 billion in 2023,

representing a compound annual growth rate of 6.8%. They have predicted that from 2023 to

2035, the overall market will grow at a compound annual rate of 9.1%, bringing the market

up to $9.8 billion (Gazzola et al., 2020).

With the ideals and concept of ethical and sustainable fashion gaining popularity and

catching attention, the sustainable apparel market is expected to grow at a steady pace in the

coming years.

It is a market worth nearly £37 billion a year and it is growing (Niinimäki, 2018). People are

choosing to make a difference with their shopping, whether by paying more for products that

have been made under fair conditions or buying second-hand clothes, supporting the

recycling industry and cutting down on landfill waste (Wolfe, 2021).

There is a growing trend in the fashion industry to produce clothes ethically rather than go for

cheap, fast clothing made in poor conditions. The ethical segment of the market is currently

dominated by organic fibres such as cotton, flax, hemp, bamboo, sisal, and jute (Olatubosun

et al., 2021). Demand for ethical fashion continues to grow year on year, and the trend shows
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no sign of slowing down. It seems consumers are increasingly interested in where their

clothing comes from and how it was made and for this reason, more companies provide

goods that consumers want (Henninger et al., 2018).

Demand Analysis

Recalling the present, the demand for sustainable fashion is at its prime, with several brand

giants entering the market. The market looks promising for investors, who will want to make

a piece of it in the coming years. People are becoming increasingly aware of the impact of

their lifestyle on the environment and encouraging a more conscious consumption of material

goods (Olatubosun et al., 2021). This is a growing trend that has a huge potential to positively

affect the development of the fashion industry through fostering innovation and

entrepreneurship.

Developments Due to Changes in Demographics

Millennials and Generation Z are making environmentally-conscious consumer choices. With

the ability to access information, including product information, they are translating

awareness of environmental responsibility into sustainable, organic, and less wasteful

purchases of products (Gwilt, 2020). There is a generational shift for brands, as they move

from selling products to selling an overall lifestyle. This is because this generation of people

has grown up to appreciate quality food and beauty products, as young people now

understand how these products can contribute to an overall healthy body and mind. The

global marketplace has no doubt acknowledged these shifts. The proportions of consumers

demanding ethical, sustainable, organic products increased from 1% to 9% globally between

2006-2019 (Han et al., 2017). Industry watchers believe that buying products connected to

ethical and eco-friendly choices is a new form of self-expression for young consumers.
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Survey Data of 2021 to understand sustainability in the UK

In times of economic uncertainty, many people are tempted to give green issues a less

prominent place in their shopping baskets. But a survey conducted in the first quarter of 2021

shows that this development was not to be seen in the fashion sector. Respondents stated that

they now value sustainability even more highly – a view shared by 82 per cent of consumers.

Consumers are changing their behaviours in response to the perceived threat of climate

change. This involves a growing awareness among consumers of how climate change is

likely to affect them directly and indirectly as well as how their behaviours will be affected;

heightened efforts of governments and international organizations in developing policy and

solutions that tackle climate change; and direct, observable impacts of climate change on

rainforests and the polar ice caps. Consumers have demonstrated high levels of involvement

through widespread increased recycling and better transportation planning, however, these

activities have not been able to stem environmental degradation thus far.

The survey shows us that consumers are already beginning to change their lifestyles in

response to their concerns about the environment. Over half of respondents to a survey

reported that they had made significant changes in their lifestyles, and more than 60 per cent

said they went out of their way to recycle and purchase products in eco-friendly packaging.

Table 1. Given in the table below is a detailed representation of the data.

I have made significant I have gone out of my way

changes to my lifestyle to to buy products in
lessen my environmental I have started to go out environmentally friendly
Conditions impact of my way to recycle packaging
Strongly agree 7 17 9
Agree 15 21 18
Somewhat
agree 35 29 34
Somewhat
disagree 25 17 22
Disagree 12 9 10
Strongly 7 6 7
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disagree
(Source: Self-Made)

Figure 1: Survey data represented in a graph. (Source: Self-made)

Competitor Analysis

While the fashion industry still has far to go before it becomes fully circular, some brands are

making meaningful strides by profiting from old merchandise and materials. This niche

market is growing slowly but surely. In 2016, Levi’s became the first big brand to eliminate

all virgin fibres from its denim (Mukendi et al., 2020). In 2017, H&M committed to a plastic

waste-free future and Adidas introduced a prototype shoe with no waste at all. The shift

toward sustainability has been swift and significant, with global brands now formulating

policies and implementing changes through their supply chains that will benefit consumers as

well as the planet. In July 2018, Burberry announced that it will stop burning unsold

products as part of the company’s goal of becoming carbon neutral by 2040 (Mukendi et al.,

2020).

Some of the key competitors in the UK market are:

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1. Fanfare: Fanfare believes in the importance of modernity and the role of the garments

we wear every day. It believes there is a necessity to not only express one's style but

also a way to showcase a person's personality and values. Fanfare's philosophy is to

inspire people through sustainable fashion, by creating a simple but unique lifestyle

that can be easily incorporated into everyday living (Khandual and Pradhan, 2019).

They have a very well known market in the UK, especially in London.

2. Elvis & Kresse: They have a range of sustainable innovation products to help

manufacturers, brands and retailers find new ways of reducing their environmental

impact. In 2017 the Burberry Foundation launched a partnership with Elvis & Kresse,

pledging to tackle leather waste. This five-year partnership will result in the recycling

of at least 120 tons of leather off-cuts from Burberry into new garments by Elvis &

Kresse (Khandual and Pradhan, 2019).

Brand Analysis

Beach House plans to offer a range of carefully selected contemporary threads and redefined

basics that are both seasonless and produced sustainably. It will promote the use of minimal

clothing by sustainable approaches to fashion. Beach House is a fashion line of thoughtfully-

designed, ethically-made essentials for the people who know the value of minimalist fashion.

The plan is to rethink conventional necessities, emphasising durability and efficiency to

create capsule wardrobes that are designed to adapt to any situation.

Beach House rejects the mainstream practice of producing trendy clothing to meet the

demands of fast fashion and employ slow-fashion techniques in our designs, thereby

producing high-quality apparel that is both sustainable and socially responsible. As our

silhouettes celebrate the feminine form, their garments are often worn beyond the season of

their original purchase. Limiting production runs will minimize waste and deadstock.
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Sustainable materials will be used in our collections, such as organic cotton, Tencel, and

modal. In selecting fabrics, the plan is to emphasize how each is produced and the extent of

their impact on the environment, such as how much water and toxic chemicals the process

requires. Our work will be exclusive with small, family-run factories in Europe. All

production is carried out in the UK, and the garments are manufactured according to GOTS

certification standards. This will enable to reduce the transportation time and environmental

impact of the goods.

Product Analysis

The idea of the product is to introduce a fashion line that is sustainable and yet luxurious. As

mankind demands higher luxury products in life, the energy consumption in producing these

products is also increasing with the growing prosperity of the population. This trend crosses

all segments in the fashion industry. Living in a dichotomy, consumers judge products based

on their appearance and the sustainability of the product at the same time. The contradiction

between these two properties can be solved by establishing a uniform material with an

appearance that will make it part of any retail scene, such as clothing and accessory design

(Zhang et al., 2021).

With this product line from Beach House consumers will be able to experience both luxury

and sustainability at their best. The plan is to create transparency in the supply chain, use

sustainable materials, create the best designs that reflect luxury and make them in limited

form so that they can last longer (Olatubosun et al., 2021).

On the market of non-material values in the consumer society, growing demand for

sustainable products in ethical and socially responsible brands in the virtual world has been

noticed. In this market, environmentally friendly product presentation together with

minimalism and creativity is the trend that one cannot fail to notice. Consumers have a

growing concern for the environment. In the UK, people are increasingly aware of how our
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linear model of fashion distribution harms the environment (Niinimäki et al., 2020). They

blame top-end brands for excessive waste and conscious consumers are trading down to

second hand or vintage clothes rather than buying new, supporting ethical retailers rather than

conventional brands, reusing clothes rather than throwing them away. The statistics are clear

- consumers are largely aware of the social and environmental impacts of their purchasing

decisions, which is translating into a tangible interest in circular fashion products (Moorhouse

and Moorhouse, 2017). At the same time, there is always a demand for sustainable clothing

that would feel like a luxury. Keeping this in mind it is very clear that the idea of a fashion

line luxurious and sustainable has a potential market and in this market, Beach House has the

chance to grow into a well known profitable brand.

Financial Analysis

Beach House will expand moderately and maintain a positive cash balance. The brand will

continue to sell only for cash. A few months after the business is stable the brand will start

accepting checks and all major credit cards. It will reinvest unexpended profits into company

expansion and personnel. Marketing and advertising will account for less than 5% of sales in

the future.

The Use of Funds

A total of £8000 is going to be invested as the expense for the start-up of the company.

Pre-launch expenses include fabric cost- £3,000 and storage unit- £2,000, rent of the office-

£1000, legal expenses- £500 and another £2000 on logo, branding and promotions.

For the pre-launch asset, another £80,000 is needed. Out of this amount, £17,000 will be the

cash in hand, £32,000 will be spent on inventories, £1000 on other assets and £30,000 on

office supplies and tailoring machines.

Calculating this the total capital needed for the business will be around £88,000.
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A total of £40,000 will be supplied from the investments of the founders. There is already a

credit line of £25,000 from the bank and the rest £33,000 will be taken as a loan against the

UK’s start-up loan scheme.

A Projection of Future Profit and Loss

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A Projection of Balance Sheet

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A Projection of Cash Flow Statement

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Operational Analysis

The company Beach House can pursue a circular business strategy that aims to reuse

materials and products as much as possible, thereby eliminating the need to rely on raw

materials continually. They can also try to use renewable energy sources and limit pollution

as much as possible. The clothes industry is the face of the fashion industry and it consumes a

lot of resources as its product lifecycle is very long. Living in a dichotomy, consumers judge

products based on their appearance and the sustainability of the product at the same time.

Sustainability and aesthetics are not often recognized as necessary to the product

development and distribution process. There's a belief that if something is sustainable or

ethical, it can't be stylish or superior in some other way. However, the consumers would like

to buy sustainably and ethically products that are also superior in style, quality and price.

Consumers are more concerned about sustainability than ever before (Mazzarella et al.,

2019). Yet, they also want luxury fashion to remain affordable and within their reach. And as

luxury brands have been lagging behind their fast-fashion competitors, it is even more

important for luxury fashion to provide a unique narrative around sustainable practices and

affordable price points. The resources available will be plentiful. Beach House's business

model can significantly reduce waste and costs for companies, as well as the environmental

impacts associated with traditional recycling methods. The clothes produced will be

handmade and therefore each will be unique. However, sustainability and aesthetics need to

be present for customers to become aware of the benefits of the product. The designs will be

done in a way that reflects luxury when worn. When the fabrics are to be selected the amount

of water that is used to produce them should be kept into consideration.

Conclusion

Sustainable fashion is a novel approach to the world of style and luxury, and it is changing

the way people buy clothes. Sustainable fashion emphasizes quality, attention to detail, and
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timeless design over the pursuit of 'fast fashion, which has become associated with low-

quality items made from fast-fading trends. Sustainable clothing companies use eco-friendly

fabrics and materials in their designs - fabrics such as hemp, linen, and organic cotton. A

sustainable brand like that will be Beach House. As people are more aware of the problem of

over-consumption, sustainable fashion has become big news. There are lots of ethical high

street brands on the market today making it easier to shop against wearing the same thing

over and over again. The environmentally friendly focus of many of today's emerging

designers has been prompted by the increasingly urgent need to deal with issues such as

pollution and global warming. Fashion is all about instant gratification – from constant new

trends to instant gratification from the web – but the impact from both design, manufacture

and disposal needs to be considered carefully.

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References

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Wolfe, I., 2021. The 34 most ethical and sustainable clothing brands from the UK. Good On

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brands-from-uk/ [Accessed November 29, 2021].

Common Objective, 2018. Understanding the market for Fashion & Sustainable Fashion.

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https://www.commonobjective.co/article/understanding-the-market-for-fashion-

sustainable-fashion [Accessed November 29, 2021].

Radonic, D., 2021. 21+ eye-opening sustainable fashion statistics for 2021.

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Shahbandeh, M., 2021. Ethical Clothing Sales Revenue UK 2014-2019. Statista. Available

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quantitative approach. Sustainability, 12(7), p.2809.

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Han, S.L.C., Henninger, C.E., Apeagyei, P. and Tyler, D., 2017. Determining effective

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fashion: A cradle to upcycle approach. Springer.

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Niinimäki, K., Peters, G., Dahlbo, H., Perry, P., Rissanen, T. and Gwilt, A., 2020. The

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