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22:07, November 22 270 0

2016-11-22 22:07:19
Unsustainability Shutters Socially Responsible Luxury Brand Suno

After eight years, the socially responsible luxury brand Suno is shutting its doors.

Suno will not produce its spring 2017 collection, the designer Max Osterweis told Business of Fashion. Mr. Osterweis and his design partner Erin Beatty had received positive reviews at a presentation during New York Fashion Week in September. Neither he nor Ms. Beatty was available for further comment.

The news raised questions about the viability of small businesses trying to combine a socially responsible mission with style.

Founded in 2008 by Mr. Osterweis, the label from the beginning was committed to practices like training tailors in Kenya, making its first collection from East African kangas and working with small-batch factories in Italy, Romania and South Korea. It expanded after hiring Ms. Beatty, who had previously worked as a creative director at Tory Burch and as a product manager at Gap Inc.

Over time, Suno, which is carried by more than 70 retailers including net-a-porter and Neiman Marcus, attracted support from celebrities (Michelle Obama, Beyoncé, Taylor Swift and Michelle Williams are fans) and industry players. In 2013, Suno won the CFDA Swarovski Award for women’s wear, and in 2014 it was a finalist for the LVMH Young Fashion Designers Prize.

But what made Suno appealing to some may also have been its downfall.

“The product is beautiful, but it was very specific,” said Gary Wassner, the chief executive of Hilldun Corporation, which offers loans and credit to designers, and which has offered financial assistance to Ms. Beatty and Mr. Osterweis for years. “I’m not sure from an investor perspective that anyone could see the opportunity to turn it into a sizable brand. It’s made in Africa, it’s sustainable, they’re very true to their beliefs, and that limited their ability to be competitive price-wise and in scale.”

The label toppled because one of the partners wanted to leave, and the other had been struggling to find a replacement, said Mr. Wassner, whose clients have included Alexander Wang and Marc Jacobs. A spokesman for Suno would neither confirm nor deny that that was the case.

Plenty of small, sustainable businesses are solvent, Mr. Wassner said. But for them to succeed, everybody at the helm has to be on board. “They don’t have aspirations to be a $50 million brand,” he said. “And in each of those cases, there are two partners or one, and nobody wants to leave. They’re happy to be there, so there’s no disruption in their course of business.”

Elisa Niemtzow, the director of consumer sectors at BSR, a nonprofit that works with companies like Nike, Levi’s, Kering and H & M on sustainability practices, said that Suno’s closing shouldn’t be seen as a failure for socially responsible brands.

“If you look at a brand like Stella McCartney, that’s a brand with double-digit growth,” she said. “Fifty percent of her collection is sustainable.”

There isn’t one industrywide standard for sustainability and social responsibility, Ms. Niemtzow said. Many companies set their own goals.

Some choose to work with factories where employees are offered fair wages and safe conditions. Others focus on developing fabrics that require less water or energy to produce.

The Better Cotton Initiative, for example, brings together more than 50 retailers and 700 suppliers working to set higher environmental and social standards in cotton production. H & M and Levi’s work with an organization called I:CO to collect, reuse and recycle clothing.

Patagonia offers customers the opportunity to have their clothes repaired to prevent excessive waste.

Reformation, a boutique clothing brand, collects information on the environmental impact of each of its garments and shares those findings with potential customers through its website.

But Ms. Niemtzow conceded that sustainability and so-called ethical practices don’t come cheap.

“We do hear from brands that making more sustainable choices can be more expensive,” she said. “Sometimes the brand has to choose to have lower margins on the products.”

She offered Ms. McCartney’s use of faux leather as an example. “That’s actually a more expensive choice,” she said. But she argued that it can pay off in the long run. “You’ll have good will, and attract a following,” she said.

Steve Swartz, a partner at McKinsey & Company, made a similar point in an email. “Sustainable and/or ethical fashion is a balancing act between the ability to charge a price premium and the technical expertise to create product with better environmental or social performance without adversely impacting the product’s margin,” he wrote.

It is unclear whether Suno found that balance. It was difficult for Suno to secure additional funding when it had been doing business for nearly a decade and had kept its output steady but low, Mr. Wassner said. “They had a really clear point of view, which is exactly what you look for as an investor,” he said. But it remained so specialized, “It was hard to attract an investor,” he said.