The Process of Becoming Sustainable with Shannon Lohr of Factory45

Hello, and welcome to this episode of Conscious Design. I'm your host, Ian Peterman, and author of the book Conscious Design. And I'm excited to have Shannon Lohr, founder and CEO of Factory45, on the show today. Welcome to the show.

Thank you so much for having me, Ian.

Yeah, so I found you looking at And saw what you guys are doing. You're doing a lot of work in sustainability and fashion and helping other people start their own fashion companies, but in a sustainable way. And I'd love to hear how— because everybody seems to have a unique story of how they get into sustainability and products. So I'd love for you to share a little bit of your story on how did you— how'd you get here to doing what you do now?

Yeah, it was, it was not a direct path. It rarely is. It rarely is. I was a journalism major in college, actually. So no interest in sustainability or fashion. As a matter of fact, I would consider myself like a fast fashion bargain bin junkie in college. I would go to a Forever 21, buy a dress to wear that night, wear it once, throw it into my— the back of my closet, never wear it again. I was definitely a part of the fast fashion problem. And it wasn't until I started looking into building my own business and my own brand and just investigating the fashion industry and what it would take to bring a physical product to life that I realized how damaging, polluting, really just dirty the fashion industry is. And that's what led me to go down the road of seeing what it would take and what it would mean to create a sustainable fashion brand.

Got it. And, and in that journey, taking your own brand, did you do just one? Like, how, how was that journey? Was it a long one? Was it a lot of exploration? Oh yeah.

Yeah. I mean, as you can expect, right? So someone with no fashion background trying to start a fashion brand. And at the time I had a co-founder. We started designing a line of 10 pieces that could be mixed and matched to create over 100 different looks. So the idea was we were, you know, after college we were traveling the world. We were aspiring minimalists. We were backpackers. And so it was a wardrobe that we ourselves wanted. It would make it easier just to get dressed, you know, throw everything in a backpack and be on your next adventure. But what we quickly realized was how difficult it was. It was difficult to find sustainable fabrics. It was difficult to find a manufacturer who would work with us. It was difficult to find buttons that weren't made out of plastic. It was difficult to find drawstrings that weren't made out of nylon or synthetics. So, um, that quickly led us to simplify and we ended up launching one piece, one garment that could be worn 30 different ways. And it was made with 100% recycled materials, organic cotton drawstrings, natural wooden buttons. And the manufacturing was within a 50-mile radius in the US.

Wow. That's a pretty, that's a pretty tight circle for, for a manufacturing supply chain.

Yes. Yes, it was pretty, pretty unheard of at the time, especially, you know, when people weren't even using the word sustainability and fashion in the same sentence.

Right. How long did it take you guys to, to do that and be able to actually get your first sustainable product out there?

It took a year and a half. Yeah, so it was a lot of Emailing, cold calls. We, I mean, we reached out, we reached out to, you know, farmers in Texas, professors in Missouri, an eco-friendly supermodel in Brooklyn. Like, we were all over the place just trying to network our way in because anyone who knows about the fashion industry and manufacturing knows it's very closed off. It's hard to get doors to open for you. So that was a big part of it, was just trying to put our supply chain and manufacturing together.

And when you're going through that, so like 50-mile radius, that's something not everyone, especially early on, was really thinking about is all the cost of shipping. You mentioned that minimalism was something that you guys were really thinking about. You were living a more minimalist lifestyle, do you think that impacted or helped to guide the sustainability side? Do you, do you feel like they're in a way work together? Did that help or is it not related?

I, oh, I definitely think that it creates a more holistic approach for, for sure. I mean, at the same time I was like becoming a vegetarian, I was starting to only shop at thrift shops, like It was very much kind of like a lifestyle shift that of course is gradual and, you know, doesn't happen overnight. But it was all sort of this kind of like thought, like this thought shift of like, okay, well, we're thinking about this, but what about this? You know, it just, it's like breadcrumbs that kind of lead you down this path. And ultimately, you know, you end up like complete— in some ways completely changing your life.

Right. Yeah, it's never— when you look at it initially or while you're in the middle of it, it never seems like a huge— like, oh well, that makes logical sense. And then you look back 2 years, you're like, oh wow, that's— I'm not the same person. This has all changed. We're now only doing these things and never these things anymore. That's a big, big shift.

Mm-hmm.

When you fast forward a little bit to now, you run Factory 45, you are helping others along the same journey. You've obviously shortened it a little bit, you've been able to speed it up. But are you seeing the types of people coming to you, or is it mostly people who are already super sustainable, super, you know, already there? Or are there more people like you were initially, like starting at the beginning and you're exploring, and now one of the things is, oh, well, I should also start a sustainable fashion line, and that's part of kind of that journey?

Yeah, I would say it's probably about 75% of people are already like invested in sustainability in some way and are, you know, particularly drawn to Factory45 because of the emphasis on sustainable fashion. And then there are about 25% of people who just want to start a fashion or accessories brand, and we're able to kind of guide them into ways they can incorporate sustainability into their supply chain without sacrificing the product, you know, the design, the functionality, the fit. I always say you cannot make concessions on the product itself for the sake of sustainability, because if you make the most sustainable product that's ever existed and it only sits in someone's closet and they never wear it, or they end up throwing it out right away, then It's not sustainable. So, um, yeah, I would say it's about a 75/25 split.

Got it. And that's— so what you're talking about too is, right, the sustainability is a great thing, but if nobody buys it or if nobody uses it, that's also not sustainable. That kind of ruins, ruins your sustainability if it just sits there, or worse, you pay to make it And then it sits there and nobody buys it at all. And that's, that's something that we talked about before. One of the things you do is you help guide people through pre-selling to make sure you're not— because one of the biggest wastes in the fashion industry, that at least to my understanding, is that they buy 1,000 of something and they only sell 900 of them, and they end up having just this leftover mass amount of clothes. For every style that just never gets sold. And you had to, you know, go to secondary stores, you know, like Northwood Rags, or, you know, all those other secondhand— you tear it down eventually, but eventually there's still leftover. No matter, no matter what you do, there's leftover, which is part of— part of the issue.

The, the, the finished garment waste in the fashion industry, and I'm talking like the bigger brands, you know, there are brands that have been caught just throwing out trash bags of perfectly, perfectly good garments, slashing through them so that they can't be resold but are going to go to landfill or incinerator. Like, that is a huge issue. And so part of the sustainability conversation, at least from what I do in my work, is pre-selling so that you have customers before you create any inventory. You know that that garment has already been sold. So this is great from a sustainability standpoint, but also from just a risk standpoint. From, you know, you can reduce your own risk in terms of money and time and energy into, you know, again, knowing that you're going to have customers and you're not creating any inventory that you can't sell. Right.

And is there any other points? So obviously, you know, pre-selling is really important. The materials are really important. What other things do you look at when you're looking at sustainability on this holistic level? What are other areas that you really go, oh, we really need to care about this when it comes to, you know, you and everybody you're helping launch?

Yeah, I think end life is one that's often overlooked, the end life of a garment. And it's very important because again, it's like, okay, you've used that garment. Hopefully it's well-made and it's trendless, timeless, durable, and you can wear it for years and years and years to come. That's the goal is like heirloom pieces, right? That you'll be able to like pass down. Um, but when that's not the case, What is the end life of the garment? Is it made of entirely natural fibers so that it can break down and compost back into the ground, or is it made of one single type of recycled fabric that can then be broken down and recycled into new thread and made into a different fabric? Um, can it be Is there a buyback program? Does the, does the brand offer a buyback or at least take back of the garment so that they can repurpose it or upcycle it into something new? I think all of those things are important to consider because again, it can be the most sustainable garment, but if it's just going to sit in a landfill, you know, for the next 100 years piling up, then, you know, is it sustainable?

Yeah, I think that's something across the board, not even in just fashion, but products that I work on, that's almost never— most of my career is working on products where that was never even a conversation.

Mm-hmm.

It was always just assumed that, oh, it'll be thrown away, I guess. Nobody really talked about it, actually. It wasn't even a, you know, it wasn't even a thought that we had in designing things. And so it's That's part of why we're— we have the issue, right?

Yeah.

Because we have piles of garbage that we didn't just— we didn't think about what would happen at the end of life. So that's great. That's— it's so important that we stop skipping that step because it's, it's a huge step that happens. Um, now the other thing that I— and I still even get people that are convinced you can't be sustainable profitable. So that, but that's something that you clearly, you've launched your own brand, you've launched, helped people launch multiple brands. What do you see? Do you see sustainable as more profitable? Do you see it as a, how do you approach that whole profits, but also sustainable metric and kind of where do you see it going?

Yeah, I think you just need to know who your customer is. I think there is a segment of customers who are willing to pay more so that your margin can be a little bit bigger so that you can be profitable and not try to compete with the mainstream or fast fashion brands. Like, that's never, never going to be a win-win situation. That they just, you know, you can't compete with $5 t-shirts. So you want to really identify who is that target customer who's willing to pay more because they know that they are, again, going to wear the garment for years to come. They're going to, you know, it's going to be a staple in their closet and they know that they are buying less and buying better. So I think that's really what it comes down to is don't sacrifice your margin. You need to, you know, factor that in so that you can be profitable, but knowing that there are customers out there who are willing to pay more. And, you know, it's a matter obviously of finding them.

Right. So you see it as more of a marketing, right? Making sure that you don't, don't compete with a $5 t-shirt because you're not, you're not 100% plastic. You just can't, can't do that. And finding the people who do care, that do go, yeah, I want to pay for a sustainable product that's going to last. I'm willing to invest. And, you know, make sure, of course, make sure your margin is there.

I mean, the irony of all of this, and I've always thought about this, is that the people who really— and I can say this from experience because I was totally bought into the fast fashion model and was, you know, buying fast fashion. But probably at the end of the year, the people buying fast fashion, you know, $5 t-shirts, $10 dresses, probably you're spending about the same amount as the people who are buying more expensive quality garments. They're just buying way less of it. So that's the interesting thing too, is like it kind of evens out in a lot of cases.

Well, and even if you do, if you are the person that buys a $5 t-shirt and wears it, they also don't last really long. So, right, that $5 doesn't, doesn't last that long. I mean, you could make an argument for kids who grow really quick. Yeah, you don't need to, but as in, once you stop growing, your, your reason to have something not last long goes away.

Yes.

Pretty quickly. So I would imagine from the longevity part too, if you're— if longevity is part of the sustainability portion, you'll buy one piece that just, just lasts. First, if you last years, you're None of the $5 t-shirts I ever got lasted years.

No, right. And when you look at the cost per wear, you know, that's something that we should start to consider. Um, so yeah, I think it's a, it's another angle to look at.

Hey, it's Ian here. So glad you're enjoying this episode of Conscious Design. If you want the full scoop on Conscious Design, what it is, how we do it, how you can do it, Then check out our book. We wrote it so creative entrepreneurs like you can code social and environmental responsibility right into your brand's DNA. You can download the first chapter for free. Link is in the description. Enjoy the rest of the episode. Don't forget to like, subscribe, and share. In, in all the brands that you've helped launch, is there any that really stand out as having been able to achieve something more sustainable Like really broken through? And I know you mentioned in yours you used, you know, wood for buttons. That's so rare now to see buttons that aren't plastic. So like, that's amazing to be bringing a different material there. But is there anything you've seen like, wow, we've figured out a new thing that we can— a new option for sustainability that has really helped and could help with fashion more?

Yeah, I don't know that it's so much about it being new as it is about just the different directions you can go. And just also when we talk about back to kind of like profit and scalability, there's one brand, Vetta, V-E-T-T-A. The founder, Cara, she's found a way to scale. She launched from Factory45 in 2016. And, you know, she, I just got an email in my inbox. They released a new collection today. Like they have an office in LA and employees and like, so she's found a way to really scale the brand, which, you know, is a whole other sustainability conversation.

But—

Right. But also then I have brands who, you know, they just want to, they don't want to build an empire, right? They just want a creative outlet. They want a side income for their family. Like, I think that part of it is just identifying what your entrepreneurial goals are.

Mm-hmm.

And then, and again, like, we do the best we can as we grow. So where can we incorporate sustainability as the business evolves, as it grows, bringing the customer into that journey, into those decisions? I think those are all things that have been exciting for me to observe with the brands that have launched.

Do you see, obviously, like the real commercialization, like we just talked about scaling, like that's a whole own beast over there to not only do, like just doing it's hard, but doing it sustainable is even harder.

Yeah.

In everyone else, is there more, you know, in the size, Is there any kind of— do people mostly just release one collection? Is it that kind of— is that one thing? Are you seeing a lot more small groups of collections?

Yeah, small groups of collections released. Again, we emphasize so much keeping things trendless, being seasonless. So that helps when you are a smaller brand and, you know, the supply chain is backed up or you can't get on your manufacturer's production calendar right away, that you can sort of adapt and adjust your production timeline. But most of the brands release collections probably every few months. And then some of the ones that are more established, it's maybe more often. But again, it's most seasonless, trendless, timeless.

Got it. So more of a, again, fewer is better if you do it right.

Yeah.

Kind of mentality.

Yeah. And you can go back and create more inventory of your best-selling pieces. It gives you time to sort of observe what your customer wants, what they're asking for, where you can make design changes to increase sales on that particular garment. Instead of just rushing into the next collection, not taking in customer feedback, and then just thinking that you have to keep up with like, you know, right now we have 52 trends a year because of fast fashion. That is a trend.

A week, a trend a week.

A trend a week. So like to think that you're going to keep up with that or should keep up with that is just, you know, never going to happen for us. small, small brand and shouldn't. And I think the ones that embrace the slower production calendar are the ones who I think do really well.

So you're seeing, you're seeing the ones that don't try to keep up, they slow down, they do a few trends a year rather than, rather than 52. That was, that was a lot. Those are the ones that are really seeing success. They're able to To do this more, I'd say it's a more measured approach of going, here, let's design something, see if people like it. If they like it and pre-sell, then order and then get feedback and then do kind of slow iteration, which in this world is very, it seems glacier if you're doing it only a few times a year, but that seems to be—

Yeah, it can, but it's also like such a great way to get your customers excited It's like that, again, from a marketing perspective, it's like the pre-launch buildup. You know, we're getting ready to release new pieces, like asking for them to vote on fabrics or colorways or design elements. Like all of that, that sort of conscious design process can be really leveraged from a marketing perspective. To grow the brand.

Yeah, it makes it— it's almost like you're pulling in— because you see how successful crowdfunding campaigns are, and one of the things that people love is the whole, you know, reach a new level, get to add new features to it, right? That's, that's like really cool because you get it, get it engaged, and you're like pulling that out and creating a more engaging audience, which, which is great. Anything you co-create You're much more interested in, you're gonna buy more, you're gonna support, care about all these great marketing things.

It's a major strategy that we use in the Factory 45 program and in terms of pre-selling and crowdfunding. Yeah, it's a huge part of it.

That's amazing. It probably works really well because those people, most of those customers are probably really sustainable focused, right? They're already willing to pay more. So that means they get to be part of being sustainable and not just a consumer of sustainability.

Yeah, and they're willing to wait. Like, they're willing— like, people who are more, you know, sustainably focused, they understand slow fashion. They're willing to wait for it to be a preorder so that they can go into production. And it all works together pretty well from what I've seen over the past 10 years.

Well, that's awesome. That's great that you were able to do it. And then now you're helping people do that. How many brands have you launched now?

Oh, we don't even have a count anymore.

You don't have a count? Oh, you don't know what?

Well, it's like there's a new brand. I feel like there's a new brand launching like every week. But you can go to the alumni stories page or the Market45. We have Market45. That's our ethical fashion marketplace. You can see the brands that— some of the brands, not every brands on there, but some of the brands that have launched through Factory45.

And Market45 is just for Factory45 alumni, is that correct?

Yes. Yep.

Awesome. What got you thinking about building? Because that's a whole other thing, right? To build out a platform. What guided you or drove you to Go, hey, we should build, we should build a store for everyone.

Yeah, people kept asking me and they said, they kept saying, is there— this goes back to like, listen to your customer, your customer, your people will tell you what they want. People kept asking me like, is there one place where I can see like I could shop like all the brands, all sustainable? Because that's the other thing, you know, even my friends and family, like, where can I see just like sustainable and ethical fashion brands like in just in one place? And so, you know, obviously Market45 is just brands that have launched through Factory45, but it's one place where you can kind of explore all different types of brands. We have athleisure on there, we have postpartum clothing, we have womenswear, menswear, all different kinds.

Hey, you guys, I've glanced through and you guys have launched quite helped all kinds of brands get out there, which is amazing to see that there's sustainable, ethical, and it's not just, you know, athleisure wear that's doing it, right?

Yeah.

It's not just that. It's other areas are being able to be made sustainably as well, which is great. And kids, that would be— I'd imagine the kid fashion industry is quite Quite heavy on the waist because you don't wear it for very long. Yeah, it's very— we have kids, so they never last very long. They last less, shorter than you think they will. The sizing is deceptive.

Yeah. Oh my gosh, I, I can also relate. I have a 4-year-old, and, um, one of my favorite brands— I'll just shout out to Pure Color Baby, which is a Factory 45 grad— and they came up with this idea of Grow With Me sizing. So you like— my son wore one outfit from them from like 6 months old to, I'm not even kidding, like 2 and a half or 3 years old, which, you know, like how much they grow in that.

That's like 10 sizes. Yeah.

Yeah.

Yeah. That's awesome.

Yeah. So yeah, I've seen— and that's like another sustainability element, right, that you like wouldn't even think of.

Yeah, there, there was one I forget the name of the company. There was one company that we heard of that had like a couple options, but it was like this weird outlying sub-brand that like had the different size. It grew with you, but like for a few sizes. And I was like, oh, that's a really great idea. There should be more of that. So that's good to hear that there are, there are more people realizing, hey, you should make clothing that lasts longer for kids because they grow so quick.

Yep.

That's awesome. That's awesome. Is there— as you're going through this process, right, you're helping somebody launch, you help them with marketing, you help them with the design, you help them with sourcing. Kind of where, where, where do you consider it launched? Is this sold? Is it kind of— where, where do you, where do you start marketing and say, yes, we've— we We measure this as a successful launch.

Yeah. So we measure a launch as a presale campaign. So whether that is a crowdfunding campaign like Kickstarter or a presales campaign on your own e-commerce site like Shopify, we teach a strategy also called the virtual pop-up, which happens on Instagram, but it's also a presale. So there's all different kind of like pre-selling strategies we teach. And once you do pre-sell, like start your campaign, which usually, if you're following the Factory45 way, then it has a finite period of time. It's either like 30 days or 2 weeks.

Okay.

Then that's considered a launch. And we actually have a $1,000 launch incentive for all of our brands. So whenever a brand launches through Factory45, we invest $1,000 back into their brand when they do that launch.

That's awesome. I saw, I saw that, that you guys offer that. It's a great, great way to incentivize actually getting to the end, to the finish line. Yeah, which is the most— I've been doing product development for, for 15 years, and the finish line is elusive. Yeah, for a lot, for a lot of people. So it's great to see that there's An extra reward of, okay, let's— especially for people who have really great ideas, it's like, we really want you to get across the finish line and launch because this is, this is a really great idea. And yeah, more sustainable fashion is a really great idea. We should have as much of it as possible. So yeah, I think it's a great, great offer that you guys have to help, help push people all the way, all the way to the end. Um, well, before we wrap up, is there anything else that you want to share? You know, whether it's to somebody who's thinking about getting into sustainability and fashion, kind of what else, anything else you'd like to share?

And well, if you are looking to start a sustainable fashion brand, um, you can go to factory45.co. You can book a call with us just to talk about if our business goals align and if we're the right fit. And then otherwise, we have tons of free resources. There's a YouTube channel, we have a podcast called Start Your Sustainable Fashion Brand. Lots of free resources on Instagram @factory45co.

Amazing. Well, anybody that's looking, you should definitely check out Factory45. You're, you're guys good. You do a lot. So it's great. It's Great resource. And I really appreciate you taking the time to be on the podcast to be able to talk about fashion and sustainability and hopefully helping to slow down fashion overall. Get enough, get enough slow fashion out there. Maybe we'll hit a medium fashion as an average.

Oh man, what a day that would be.

Yeah, I feel like it might be a ways off, but I feel like it's a really good goal. To get towards. So yeah, I really appreciate being able to chat and share what you're doing.

Thank you so much for having me.