Towards Sustainable Transformation in the Fashion Industry: Exploring the Role of Business Model Innovation

Abstract

This thesis presents an exploratory study on the potential of Business Model Innovation as a means for companies in the fashion industry to achieve sustainability. The fashion industry is known for its negative environmental and social impact, and there is an increasing need for transformative change to address these challenges. As studies in this area have not adequately addressed how to design-, implement-, and scale sustainable business model innovations, this paper aims to contribute to close this gap by conducting a qualitative single-case study using the fashion industry as a case.

Findings reveal that business model innovation offers significant opportunities for fashion companies to integrate sustainability principles into their core operations. By rethinking traditional business models and adopting principles such as collaborative business models, social enterprises, sufficiency-driven business models, collaborative consumption, and product-service systems, companies can enhance their environmental performance, improve resource efficiency, and address social issues throughout their value chains. This research reveals that the most successful business model innovations enhance product and material efficacy and can reduce overall consumption by changing consumer behavior (e.g., collaborative consumption).

The study also identifies various challenges that hinder the transition to sustainable business models, including a lack of infrastructure, knowledge, and investment. The findings emphasize the importance of consumer awareness, industry collaboration, and supportive policy frameworks to facilitate the transition and scale up sustainable practices within the fashion industry. With the growing prominence of transformative changes driven by new EU legislations, further research is needed. This thesis serves as an initial contribution, but additional work is required to operationalize the process. The researcher proposes conducting quantitative studies and narrowing the scope to validate or challenge the findings presented in this study.