"Natural" Movement

• Perhaps the biggest impediment to the widespread use of Rayon is consumers' preference for "natural" fibers. Even though Rayon is a hybrid material, it is perceived to be a synthetic fiber. Rayon is more biodegradable than cotton, its main competitor fabric, but it does not enjoy the same "green" image.
  
  

Complex Manufacturing Process

• Rayon has to be made through a complex, sixteen-step procedure, that involves the use of multiple caustic chemicals. Because of the complexity, Rayon manufacturing is limited to developed countries. Cotton on the other hand, can be farmed and woven in developing countries. Also, the cost of the rayon factories require a great deal of capital investment which deters the growth of the Rayon market.
  
  

Cotton Costs

• Cotton is Rayon's biggest competitor and when cotton dips in price, Rayon loses customers. Alternatively when cotton goes up, Rayon gains customers. However, Rayon requires greater amounts of investment to manufacture, so investors are reluctant to spend the money in a market that can flip in demand so easily. If there was a prolonged drought in cotton producing areas, or if there was a cotton plant plague, Rayon would gain more widespread use.
  
  

Environmental Regulations

• Many of the chemicals used in the production of Rayon are tightly controlled by the United States Environmental Protection Agency (EPA). The regulations are so onerous that the biggest Rayon producers are in India and Italy just to escape the EPA's reach. The specter of additional regulation in these other countries also deters investors from building new Rayon factories.