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These two women are out to destroy H&M's business model

Nicole Goodkind
Nicole Goodkind
Daily Ticker

Stores like H&M (HNNMY) and Forever 21 are considered “fast fashion,” selling trendy clothing that is designed quickly and cheaply, with turnaround times as fast as two weeks. Soraya Darabi and Maxine Bédat don't like that business model. They've created Zady.com, an online retailer that focuses on high-quality well-sourced clothing that’s ethically made and built to last. “We’re offering real transparency [in the clothing-world] for the first time,” says Darabi. Think of it as farm-to-closet.

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“What you notice when you just ask a brand where their product is made is the shocking response that most of them don’t know,” says Bédat. Large retailers like The Gap (GPS) and Walmart (WMT) have come under fire for their unsavory labor practices prompting many consumers to ask where the clothing they wear is coming from. Zady.com has those answers.

The products on their site are expensive. A candle goes for $60, a woman’s blouse for $225. “We think of products as price-per-wear,” says Bédat. “If you look at an H&M, they produce 300,000 SKUs each year—that’s a lot of different products. And typically those products are meant to last about three washes before they fall apart. In fact, that’s the business model of fast fashion,” explains Darabi.

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“We’ve been going through a decade where our clothing prices have gone down year after year so all we’re trying to do is build up that market that existed 20 years ago,” says Bédat.

But can slowly produced, expensive, high-quality clothing catch up in a mainstream market that demands more for less? “Twenty years ago, Whole Foods came into the forefront and was a leading change in the organic food movement, and now even Walmart carries organic food because Americans demanded that. We think that the same thing is about to happen to fashion,” says Darabi. 

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