Purpose of Literature Review
This literature review explores the impact of consumer behavior on the sustainable development of Chinese fast-fashion enterprises. It examines key players, emerging trends, and the sustainability challenges these firms face. It analyzes consumer behavior patterns, their effects on the market, and strategies adopted by these organizations. These companies have been reported to cause higher levels of pollution from their activities (Dzhengiz, Haukkala, and Sahimaa, 2023). Therefore, the paper aims to deepen the understanding of the link between consumer preferences and sustainable practices in the fast-fashion sector.
Fast Fashion Enterprises in China
Characteristics of Chinese Fast Fashion
Fast fashion has become a common strategy in many enterprises in China. In their quantitative research, Gazzola et al. (2020) note that this approach is a business model for fast, low-cost, mass-produced, fashionable clothing. It emerged when organizations began targeting the rapidly changing consumer tastes and preferences in the market.
Consumers in different countries have become more fashion-conscious, constantly demanding fashions that align with their cultures and accelerated lifestyles. Its business strategy ensures that products reach shops and are purchased quickly. Retailers in this sector constantly update their product offerings in this business model and clear their stock quickly to respond effectively to the latest trends.
Growth and Expansion of the Fast Fashion Industry
The Chinese fashion industry has been experiencing significant growth in recent years. Cui (2022) reports that this expansion has been driven by the nation’s position as the world’s largest fashion market. A recent review of this sector by Daxue Consulting (2023) adds that “the market value reached 1 billion USD in 2022 and is projected to reach an impressive 1.4 billion USD by 2028” (par. 1). It highlights that this growth is vital for both brands expanding their operations to China and customers that want affordable products.
Many local and international fast fashion brands dominate the market in China. Daxue Consulting (2023) examined these enterprises and found that most provide mass-produced, affordable clothing appealing to millennials and Gen Z customers who are price-sensitive. The fashion companies seem to have adopted the claim made by Zhang, Zhang, and Zhou (2021) that they must understand and cater to the preferences of this population to thrive in this industry. As a result, they turned out in large numbers to take advantage of this market.
Despite significant growth, the fast-fashion market in China has seen the rise and fall of many top organizations. For example, Daxue Consulting (2023) reports that “H&M has been closing down unprofitable stores in China since 2019, with over 75 closures in just three years” (par. 3). Similar findings have also been unveiled in a 2023 Global Times news article that indicates that the organization’s stores have reduced from 479 in 2020 to 360 in 2022 (Mingyang, 2023).
A similar trend has also been observed in other popular brands, such as Zara and TOPSHOP, as noted by Reuters (2022). Due to this trend, “over 12% of the top fashion retailers in China have a market capitalization of over 1 billion USD” (Daxue Consulting, 2023, par. 3). The review remarks that local enterprises like Urban Revivo (UR), Li Ning, and Bosideng now have the freedom to win a larger market share.
Key Players
H&M, Zara, and Uniqlo have developed a significant presence in the country and occupy larger market shares. Despite being top in the market and preferred by millennials and Gen Z customers, they encounter challenges that affect their operations (Liang and Kubota, 2022). For example, the Xinjiang cotton controversy led to the blocklisting of H&M, resulting in the closure of 60-70 stores (Retail Dive Staff, 2023).
Such cases have pushed international brands away and created new opportunities for new entrants. For instance, UR was ranked first in 2023 in the Tmall apparel sector based on a 4-hour sales report (Freedman, 2023). This report follows UR surpassing Uniqlo in 2022, becoming the leading organization in women’s fashion. It became one of the few local fast-fashion businesses to expand into more than 100 cities.
Many apparel firms have also shifted their attention to fast fashion. For example, Moon (2020) reports that firms like NO ONE, CHUU, and Nerdy from Korea have started “occupying offline stores, targeting young people” (par. 13). CHUU has become particularly common in China, with locations in first-tier shopping malls.
Daxue Consulting (2023) adds that more than 60,000 posts on the Xiaohongshu platform related to the firm’s fitting and styling notes are already available. This is unlike the past, when people had to wait a long time before trying on clothing through delivery. The enterprise has now enabled customers to try unlimited outfits in its physical stores before purchasing.
Emergence of E-commerce Platforms and Customer Preferences
The significant increase in online platforms worldwide, including in China, has driven the rise of fast fashion in the country. Liu et al. (2023) examined the perceived value and the subsequent effects on consumer behavior across different channels. Buyers in this industry want to purchase items customized to their preferences. The authors add that, fortunately, most of these brands have established online presences that make it convenient for people to shop from the comfort of their homes (Liu et al., 2023).
A similar report has been made by Zhao (2023) on social media influence in China. The article highlights that this approach has enabled Chinese netizens to discover new businesses in this industry and to follow the latest fashion trends through platforms like Douyin and Xiaohongshu (Zhao, 2023). This strategy has worked effectively, especially since millennials and Gen Z customers have widely embraced these platforms.
E-commerce has contributed to the success of fast-fashion enterprises in China. Daxue Consulting (2023) notes that both domestic and international firms have leveraged these platforms to expand their reach and capitalize on the popularity and convenience of online shopping. For example, according to Na (2022), UR follows a similar aesthetic to Zara. Others have also curated their sites with youth aesthetics, reasonable pricing, and style to attract more clients for fast fashion.
Sustainability Challenges Faced by the Chinese Fast Fashion Enterprises
Enterprises in the Chinese fast-fashion industry face many sustainability challenges that affect their operations and sales. According to a study by Maiti (2024), this sector is among the world’s largest water users and accounts for a larger share of total greenhouse gas emissions. Williams (2020) reports that these firms are notorious for poor working conditions and the exploitation of factory workers. They include low wages and the disregard of workers’ rights in the workplace (Bloomberg, 2020).
Bailey, Basu, and Sharma (2022) highlight that other issues include the shift in customer culture, innovation and regulation, and supply chain management. Centobelli et al. (2022) note that addressing these problems requires concerted efforts from organizations, the government, and the general public to promote social equity and environmental protection. Moorhouse (2) presents various examples from a study addressing solutions to the high pollution caused by this sector. They include innovations to improve recycling, reduce waste, and encourage up-cycling.
Consumer Behavior in China’s Fast Fashion Enterprises
A wide range of factors affects consumer behavior in the fast fashion industry. For example, social influences like family dynamics, peer groups, and social networks play a role. In light of this, a study by Li et al. (2020) underscores that traditional family values, such as filial piety and respect for elders, can shape the preferences and choices of younger consumers. Tran and Uehara (2023) add that friends and social media can also inspire people to seek a fashion or better products. Moreover, influencers and Key Opinion Leaders (KOLs) in WeChat and Weibo shape consumer preferences and drive purchase decisions.
Economic factors, such as income levels, price sensitivity, and the rise of online shopping, also influence consumer behavior. Mundel, Soopramanien, and Huddleston (2021) focus on this assumption in their comparison of American and Chinese millennial consumers. The research findings highlight that, with the rapid growth of the middle class and rising disposable income in China, many people are seeking affordable luxury and aspirational brands (Mundel, Soopramanien, and Huddleston, 2021). However, Laukkanen and Tura (2022) found that these upwardly mobile consumers are price-sensitive. Even though they are drawn to affordable clothing, they often consider quality and the perceived value of their money.
The environmental impacts of fast-fashion brands shape consumer behavior in the market. While reviewing the benefits of renewable energy amid increasing climate change, Osman et al. (2023) note that the fashion industry is notorious for high levels of pollution and resource depletion. As a result, the purchasing decisions of younger demographics in this country are shaped by concerns such as textile waste from manufacturing processes. Zhang, Liu, and Lyu (2023) note in their research that “Chinese Gen-Z consumers exhibit a high degree of environmental and social awareness and are willing to purchase sustainable products” (p. 2). They are constantly seeking eco-friendly and ethically produced clothing alternatives.
Effects of Consumer Behavior in China’s Fast Fashion Enterprises
Increased Awareness of Sustainability among Consumers
The demand of Chinese consumers for sustainable products in the fast-fashion industry has significantly influenced enterprise strategies. For instance, they have compelled most of the nation’s top brands to develop and sort their products properly. According to the findings of Mandarić, Hunjet, and Vuković (2022), there are “three key participants in environmental protection and sustainable development: people, the economy, and society” (p. 4).
Pang, Zhou, and Ji (2022) add that consumer awareness in China has led them to shift their focus from fast-fashion items to environmental protection. Verot (2023) notes that “more than 90% of Chinese shoppers are interested in sustainable products, making it a huge market for businesses” (par. 1). Therefore, organizations that implement effective approaches to bridge this gap are better positioned to gain a larger market share.
Consumers in China have witnessed the increased environmental effects of production in the fashion industry. For instance, while exploring the current Chinese situation and construction of a recycling system, Xu et al. (2022) remark that the nation’s textile and garment manufacturing has exceeded 100 million tons. A recent Bloomberg article reports that around 26 million used clothing items are disposed of annually in China (Bloomberg News, 2020). Juanga-Labayen, Labayen, and Yuan (2022) add in their exploration that China expects about 50 million tonnes by 2030 with a low recycling rate of around 1%.
Therefore, they demand brands that assure them that the whole product cycle does not involve practices that lead to air pollution, water contamination, and deforestation (Bandera, 2022). However, Rahman, Fung, and Chen (2020) note these Chinese consumers now seek to understand if their manufacturing involves issues related to working conditions, labor rights, and fair wages. They are sensitized by the increased media coverage of exploitation and cases of human rights violations (Mehta, 2020). As a result, they are more disturbed about the ethical implications of fast fashion production.
The increased consumer awareness of sustainability in this sector has led to resistance to fast fashion. Bhandari et al. (2022) note that environmental concerns have influenced negative perceptions of cheap, low-quality materials with a short lifespan. Similarly, Biela-Weyenberg (2023) adds that this new trend is now compelling the industry to shift from a linear economic model to a circular fashion framework.
Moreover, brand stereotypes associated with green practices have positively influenced consumers’ purchasing intentions for up-cycled clothing. A recent BBC news article highlights that this point of view is based on various dimensions, including the manufacturing process and communication (Ro, 2020). Specifically, these individuals are often influenced to buy based on product and service images.
The increased awareness about sustainability among Chinese consumers has also influenced brand trust and consciousness. Chen et al. (2020) conducted a study to investigate the effects of green brands on green purchasing behaviors. Based on 365 valid responses, the findings showed that “green brand effect indirectly influences green purchase intentions via green brand attitude and green brand associations”(Chen et al., 2020, p. 1). Therefore, it mediates the association between firm stereotypes and consumers’ buying intentions.
A higher percentage of the Chinese population is more interested in sustainable consumption. A report by Townsend (2024) reveals that around 88% of consumers want brands to be “environmentally friendly and ethical in their daily lives” (par. 4). Additionally, Jung, Choi, and Oh (2020) note that around 80% of the Chinese claim that the government should be on the frontline in fighting this issue. They have a responsibility to promote sustainability and overall ethical consumption in this industry.
Sustainable Practices to Respond to Consumer Awareness and Preferences
Fast-fashion enterprises in China have significantly adopted sustainable practices in response to increased customer awareness. One of the strategies they have utilized to respond to these changes in preferences is sustainable material sourcing. While exploring fast-fashion retailers’ global sourcing strategies, Arrigo (2020) notes that the exploitation of resources for clothing manufacturing has long been associated with numerous social and environmental issues.
However, the study highlights that as more people focus on the implications of their purchase decisions, many of these organizations have become concerned about the potential adverse exposure they may face. For example, a report notes that brands like Patagonia have begun sourcing materials with lower environmental impacts, such as recycled polyester and organic cotton (GMA, 2023). Such efforts have helped reduce the industry’s reliance on conventional, resource-intensive methods and minimize its ecological footprint.
Firms in the Chinese fast fashion industry have also adopted ethical supply chain practices. Wren (2022) notes in a comparative study that these enterprises are enhancing transparency and traceability across their supply chains to ensure ethical sourcing of raw materials and fair treatment of workers. They have also introduced fair wages, safe working conditions, and respect for labor rights. For instance, a Chinese fashion giant called Shein has been recognized for its recent efforts.
Jones (2021) notes that Shein has always taken supply chain issues seriously. The report notes that this organization pays workers per item of clothing. To add to this, the company’s spokesperson reported that they “have a strict supplier Code of Conduct which includes stringent health and safety policies and is in compliance with local laws” (Jones, 2021, par. 11). The company has always been ready to take immediate action in the event of non-compliance.
These enterprises have also responded to changes in consumer preferences nationwide by reducing the environmental impact of their operations. For instance, Zhao and Ye (2021) note that firms have adopted various energy-efficient technologies and practices to reduce energy consumption and greenhouse emissions. For example, Zara announced “plans to use only cotton and polyester materials that are both sustainable and recyclable, as well as reducing and offsetting all emissions by 2040” (Lai, 2022, par. 1).
Similarly, Uniqlo has made significant efforts in China to reduce its manufacturing waste. Faithfull (2022) notes that these approaches have encouraged the enterprise’s clients to bring unwanted clothing to its stores through the recycling and donation program. They have helped companies position themselves as sustainable entities that care about people and the environment.
Research Methodology
This literature review draws on multiple sources to summarize their content and effectively draw conclusions. The methodology helps determine the reliability and validity of information gathered by scholars over the years (Snyder, 2023). A mixed-method research technique will be utilized throughout the analysis. It is an appropriate method because the sources used are qualitative and quantitative data (López-Aymes et al., 2021; Wasti et al., 2022). The approach will take into account how the studies were conducted and how findings were attained.
Research Gaps and Novelty of Work
Research Gaps
Although this literature review extensively discusses the sustainability challenges Chinese enterprises face in the fast-fashion industry, significant gaps remain. For instance, most sources, such as Biela-Weyenberg (2023), Hong et al. (2024), and Mandarić, Hunjet, and Vuković (2022), do not focus on the long-term effects of these organizations’ sustainability. They could have delved deeper into their effectiveness and scalability in reducing environmental degradation and enhancing social responsibility.
There is also a need for further investigation into the factors that drive behavioral changes. Articles such as Arrigo (2020) and Dzhengiz, Haukkala, and Sahimaa (2023) have limited insight into the challenges and barriers the organizations face in achieving sustainability. Future studies could explore the specific obstacles hindering transparency programs and the strategies to overcome them.
Novelty of Work
The literature reviewed in this paper provides a comprehensive analysis of recent developments, challenges, and strategies in the fast fashion industry. They particularly focus on sustainability and consumer behavior in this sector. This analysis’s novelty lies in its up-to-date coverage of emerging trends and issues, offering a holistic understanding of the subject matter.
Compared with previously used data in the exploration, which focused on market statistics and growth projections, this literature review delves deeper into the underlying factors driving the fast-fashion sector in China. The current investigation explores the complexities of consumer behavior and the impact of sustainability concerns. It also expands on existing knowledge by integrating perspectives from academic research and news articles.
Conclusion
The fast-fashion industry in China faces many challenges arising from social and environmental factors. Even though it has grown in recent years and has contributed to numerous economic benefits to the country, it is constantly scrutinized for its sustainability challenges. To avoid negative exposures, brands have recognized the need for environmentally and socially responsible practices. Chinese consumer behaviors play a significant role in driving sustainable development. Their preferences and purchase decisions shape the strategies companies adopt in this sector. These organizations have responded by increasing supply chain transparency, sustainable sourcing, and circular economy initiatives.
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