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The Pulse of the Fashion Industry report projects that by 2030 fashion brands will see a decline in EBIT margins of more than 3 percentage points if fashion companies continue to do business as usual, which adds up to approximately €45 billion per year of profit reduction for the entire industry.

This is mainly because labour costs are expected to continue to outpace growth in retail value, cotton prices will remain relatively stable although increasing water scarcity worldwide could potentially affect the cost of future cotton production and energy prices are projected to increase steadily.

To capture the potential lost value and to protect their bottom lines, businesses must act now and pursue novel solutions to maintain and ensure profitable growth going forward.