Cashmere 101: Democratizing a Luxury Fiber

Sustainable apparel brand Naadam discusses the democratization of cashmere.

Naadam

Cashmere is touted for its exceptional quality and soft hand — but its premium price tag takes it out of reach for many consumers.

The fiber’s luxury appeal makes it a long-standing fashion favorite: The global cashmere clothing market was valued at $2.66 billion in 2018, and is forecast to grow by 3.96 percent from 2019 to 2025, according to a report by Grand View Research.

Cashmere wool is a fiber obtained from goats, often cashmere goats or pashmina goats. Its desirability is due to a set of conflicting characteristics: light to the touch, but stronger than similar wool types, and very fine, yet resiliently warm, making it somewhat atypical as far as fibers go. It also boasts an impressive set of performance qualities, as cashmere blends well with other materials and is lightweight, breathable, renewable, biodegradable, temperature-controlled and odor-resistant.

Sustainable cashmere brands such as Naadam are working to democratize cashmere. Naadam sells cashmere items for as low as $65, and offers an array of women’s and men’s products and accessories through its direct-to-consumer web site and two brick-and-mortar stores in New York, with a third store opening soon at Hudson Yards. Interestingly, Naadam’s cofounder and chief executive officer, Matt Scanlan, stumbled into the world of cashmere while working in the nonprofit sector. Though Scanlan hails from Fairfield, Conn., through a series of career changes and extemporaneous travels he found himself in Mongolia, where he founded a small nonprofit, The Gobi Revival Fund, centered on supporting communities of remote, nomadic goat herders who produce cashmere.

“The nonprofit was more about the people, not the goats,” Scanlan told WWD. But through continued exposure to the inner workings of the industry, Scanlan says he and his business partner, Diederik Rijsemus, Naadam cofounder and chief operating officer, saw cracks begin to show in the form of corrupt cashmere trade practices. “We found bottlenecks through the course of the nonprofit’s work, in terms of how the value of cashmere was being created and in terms of how we see it as customers. There were trade systems in these remote areas that kept prices low for the communities, and they would then inflate them through every step of the process because the product touched so many people’s hands,” Scanlan explained.

Naadam

Matt Scanlan, cofounder and ceo of Naadam. Photo courtesy of Naadam. 

Naadam — a Mongolian word that translates to “games” and is named after the annual Naadam Festival that celebrates nomadic culture — was launched in 2013 after Scanlan and Rijsemus traveled to Mongolia’s Gobi Desert, where they observed its powerful cashmere industry firsthand and were introduced to local ancestral herding communities. That’s when the duo created direct partnerships with herders, who have sourced for generations, and sought to accomplish far more than responsibly source and produce cashmere apparel: Herders receive fair compensation for their skillful sourcing of raw materials, and their integral part in the process helps to preserve and extend the values of nomadic life, the company said.

Scanlan explained that cashmere’s broken system left price control in the hands of traders that faced little competition on prices. Historically, since traders could dictate the terms, herders had to take whatever prices were offered, “So it’s an unquestioned circumstance that they’re not properly valuing the raw material, or the hard work, the labor, that goes into producing that product,” Scanlan said. Naadam’s business model is focused on transparency and “putting more money into the hands of Mongolian herders while taking less from customers’ pocketbooks,” the company said. Taking an atypical approach, the brand invests in their own supply chain and herding partners, and scouts ways to supplement Mongolia’s herding industry so they are less reliant on the oft-corrupt cashmere trade. Through its nonprofit work, microeconomic development, veterinary and vaccination programs, among other initiatives, Naadam deftly levels the balance between the source and the final product, enabling a streamlined supply chain and more affordable product for the end-consumer.

“We felt it made sense to remove some of those trade layers,” Scanlan said. “We thought we could verticalize the whole thing, and in the process of creating a vertical supply chain, actually use that level of transparency to remove waste and implement layers of sustainability, whether it was environmental or labor-focused, to make sure that the product was less expensive and better in terms of its impact on the environment,” Scanlan told WWD. “All along that value chain, with different people touching the product, inevitably there are layers of transportation, and inefficiencies that drive cost up but also pollute and hurt the environment, while at the same time devaluing the labor of the people who harvest the raw material.”

Photo courtesy of Naadam. 

Naadam takes a layered approach to keeping its cashmere prices low. “We thought, we’re going to buy it directly from the herder and we’ll control our logistics. We’re going to use less trucks, reduce pollution and oversee packaging that doesn’t have a harmful effect on the environment. We’re not only going to purchase that material for more money, and on top of that, I’m going to invest from a nonprofit, into your community and into your livelihood, to look at: What are the environmental impacts of this industry? Are we desertifying the local region by forcing you to overpopulate with animals? Can we lend some grassland management support? How are you irrigating the areas you work in, can we help support that?” And, more importantly, “Can we wean you off of cashmere altogether by introducing local means of diversifying your income so cashmere isn’t so central to you?”

This year, the company built a $200,000 park, aptly called Naadam Park, located within the herders’ village, equipped with gazebos, walkways and soccer fields, in addition to the planting of 2,000 trees, and planning 10,000 trees that will be planted over the next two years. The park serves as an “evolving economic ecosystem” that attracts tradesmen from all over who come to the park to sell goods, helping to fuel businesses, networking and the potential of job creation from its very existence.

Past projects include investment in grasslands management strategy to avoid contributing to desertification. An entire plot of land the size of Manhattan was sectioned off in the Gobi Desert to protect overgrazed areas, resulting in a protected food source for 100,000 goats and fresh pasture for more than 1,000 herders ever year, the company said. In addition, Naadam set up an inoculation and annual vaccination program, that to date has protected more than one million animals.

Naadam’s business model, in tandem with its community-centric efforts, have indeed created the high-quality, lower-cost product it had in mind at the start. Scanlan said, “The big picture is that transparency and a focus on sustainability lets us make products cost less for the customer, and in doing so, makes it more accessible — in essence, democratizing it.”

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