Closing the Loop: Sustainable Fashion Strategies

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1 As fashion brands work to create more sustainable businesses, retailers are making initial steps towards closing the loop, particularly around recycling and reusing clothes. Business & Strategy H&M Closing the Loop: Sustainable Fashion Strategies

2 Analysis Desp ite the shift to a n exp er ience a nd ser v ices economy, consumer s continue to b uy ma ter ia l g ood s a t unp r eced ented r a tes. In the fa shion ind ustr y, g a r ment p r od uction is exp ected to incr ea se b y 6 3% b y 2 030, p utting sev er e p r essur e on r esour ces a nd on existing b usiness mod els. In its fir st Pulse of the F a shion Ind ustr y r ep or t r elea sed in Ma y 2 017, the Glob a l F a shion Ag end a a nd B oston Consulting Gr oup a d v oca ted fa shion b usinesses a d op t a cir cula r mod el if they a r e to ma inta in a cour se of g r ow th. B y a cting d iffer ently a nd mov ing a w a y fr om linea r ma nufa ctur ing mod els tow a r d s cir cula r ones the r ep or t sug g ests comp a nies ca n p ur sue p r ofit a nd g r ow th w hile a lso cr ea ting new v a lue for the w or ld economy. F or ma ny la r g e b r a nd s a nd r eta iler s, b ehind -the-scenes w or k to close the loop is a cor e p a r t of susta ina b ility p r og r a mmes. Customer -fa cing initia tiv es focus on ma king it conv enient, ea sy a nd top of mind. The Real Real

3 Consumer choices As p a r t of their b r oa d er susta ina b ility initia tiv es, b r a nd s b ig a nd sma ll now r un a r a ng e of p r og r a mmes to close the loop, fr om in-stor e ta ke-b a ck schemes to the sca ling up of r ecycled p r od uct collections. S usta ina b ility is a comp lex sub ject for the a v er a g e consumer it' s often d ifficult for them to ma ke ethica l choices, d esp ite their g ood intentions. Consumer s a lso continue to ha v e a str ong a p p etite for fa st fa shion. " While the ma jor ity of young er shop p er s cla im tha t ethica l susta ina b ility is a key fa ctor infor ming their p ur cha sing d ecisions, their b eha v iour sug g ests other w ise; less tha n ha lf (4 8% ) of 18 to 2 4 yea r old s r ecycle their clothes, sa ys Helen Mountney, ma na g ing d ir ector of K ur t S a lmon, w hich r elea sed the r esults of a sur v ey of 2, 000 UK consumer s in Ap r il The r esea r ch found tha t new g a r ments a r e likely to ha v e a shor t lifesp a n: mor e tha n ha lf of Millennia ls only w ea r a new item for up to a yea r, a nd 2 5% w ea r it for less tha n six months b efor e d isp osing of it. & Other Stories

4 Recycling as a service R ecycling is a cor e w a y for b r a nd s a nd r eta iler s to p r omote cir cula r ity in-stor e a nd help consumer s na v ig a te susta ina b ility. Dona ted fib r es a r e now find ing their w a y b a ck into p r od uct, extend ing their lifesp a n a nd the v a lue of the ma ter ia l. H&M UK r eta iler Ma r ks & S p encer la unched its S hw op g a r ment ta ke-b a ck scheme (a ccep ting a ny textiles) w ith cha r ity p a r tner Oxfa m in 2 008, intr od ucing it into stor es in To d a te, up w a r d of 2 9 million items ha v e b een d ona ted. Time is help ing [the scheme], " sa ys a n M&S sp okesp er son. It s a b out b eing consistently ther e so shop p er s know ther e is a p la ce they ca n ta ke their items. As a g r oup, H&M ha s a mb itious g oa ls a r ound susta ina b ility, sa ying it w ill b e use 100% r ecycled or susta ina b le ma ter ia ls b y Most of its b r a nd s now ha v e r ecycling b ins in-stor e to ta ke b a ck g a r ments, incentiv ising consumer s w ith a 5 v oucher w hich ca n b e used a s p a r t p a yment on futur e p ur cha ses. & Other Stories H&M' s & Other S tor ies r eta il b r a nd fur ther nud g es consumer s into r ecycling, w ith a w eekly ta lly of customer s w ho ha v e d ona ted to a stor e ov er tha t w eek. Accor d ing to Elin L a r sson, susta ina b ility d ir ector of S ca nd ina v ia n b r a nd F ilip p a K, ther e is a need to b e consistent, conv enient a nd to r ew a r d customer s. The b r a nd la unched " Collect", a ta ke-b a ck scheme for its ow n p r od uct, b a ck in Ma r ch S p ea king a t the Cop enha g en F a shion S ummit in Ma y 2 017, L a r sson sa id : [Customer s] g et a g ood p r ice for w ha t they r etur n, r eg a r d less of the sta te it s in. It s imp or ta nt b eca use the customer ha s ma d e the effor t to clea n out their closet, b a g it a nd b r ing it in. We need ed to ma ke sur e w e ta ke ev er ything a nd not ma ke them ta ke it home a g a in.

5 Reuse F or b usinesses tha t sub scr ib e to a closethe-loop w a y of thinking, ta ke-b a ck schemes w ill b e cr ucia l for op ening up the r oute to a cir cula r ma r ket a nd g ua r a nteeing a futur e sup p ly of r ecycled sour ce ma ter ia ls. M&S intr od uced the men' s " S hw op suit" for Autumn/Winter R eta iling a t 14 9, the suit conta ins 55% r ecycled w ool, includ ing w ool d ona ted b y M&S customer s in stor e. As p a r t of its Pla n A susta ina b ility commitments, M&S is a iming to use 2 5% r ecycled ma ter ia l in a t lea st 2 5% of its clothing a nd home p r od ucts b y S p a nish r eta iler Ma ng o is ta r g eting a s the yea r 50% of its cotton g a r ments w ill conta in susta ina b le cotton, w hile it continues to incor p or a te other susta ina b le ma ter ia ls a nd p r ocesses into its lines. L ike other fa shion r eta iler s, Ma ng o ha s a lso la unched a sma ll-sca le collection using r ecycled fib r es. Marks & Spencer Ma ng o Committed is now in its second sea son a nd a lig ns w ith its S econd Cha nces ta ke-b a ck scheme a s p a r t of its w id er Ta ke Action susta ina b ility initia tiv e. Ma ng o' s S usta ina b ility d ir ector B ea tr iz B a yo told WGS N the scheme w a s cr ea ted in or d er to contr ib ute to the r ed uction of textile w a ste a nd p r omote the concep ts of cir cula r economy w ithin the textile ind ustr y, a n ind ica tion of the r ole r eta iler s a r e ta king in help ing consumer und er sta nd ing of cir cula r ity.

6 Resale and revalue Cir cula r ity is g iv ing r ise to a new r ela tionship b etw een p r emium b r a nd s a nd their p r od ucts b y p utting a g r ea ter focus on r euse a nd r esa le of their hig her q ua lity fa b r ics a nd g a r ments. Eileen F isher ha s ta ken b a ck 800, 000 p ieces of its ow n-b r a nd clothing since 2 009, g iv ing customer s a $ 5 v oucher p er item. Ma ny a r e cut a nd sew n into new p ieces a s p a r t of its cir cula r d esig n str a teg y, or sold v ia its d ed ica ted micr osite eileenfisher r enew. com, a llow ing the p r od uct to r eta in sig nifica nt v a lue. F ilip p a K ha s r un a second -ha r d stor e in S tockholm for its p r od ucts since the b r a nd w a s la unched in Commenting on the ta ke-b a ck scheme w hich sup p lies the stor e, the b r a nd ' s susta ina b ility d ir ector Elin L a r son sa ys: It s a g r ea t w a y to ha v e a d eep er r ela tionship w ith the customer b ut a lso the clothing itself. You see w ha t comes b a ck a nd d oesn t liv e up to our q ua lity sta nd a r d s, for exa mp le. The Real Real " The ma jor ity of clothes tha t come b a ck w e ca n r esell a g a in, the r est g oes to cha r ity w e hop e for d iffer ent flow s in the futur e. R eta iler The R ea lr ea l is encour a g ing r esa le thr oug h the cr ea tion of holid a y a nd a w a r eness d a y Na tiona l Consig nment Da y, la unched in p a r tner ship w ith S tella McCa r tney. The b usiness encour a g es the r esa le of luxur y g ood s, r efer r ing to the need to r ed uce w a ste a nd consump tion. In 2 018, S tella McCa r tney' s US b outiq ues w ill offer infor ma tion a nd p r og r a mmes to fa cilita te consig nment. Wor king w ith The R ea lr ea l, the b r a nd w ill host in-stor e p a nel d iscussions w ith exp er ts a b out the cir cula r economy, a nd a S tella McCa r tney p op -up shop w ill op en a t The R ea l R ea l s 8, 000 sq ft concep t stor e tha t is op ening in New Yor k' s S oho in Nov emb er

7 What next? F or ma ny ind ustr y ob ser v er s a nd env ir onmenta l ca mp a ig ner s, a d op ting a cir cula r b usiness mod el d oes not g o fa r enoug h to a d d r ess p r essur es on r esour ces. Instea d, a r g ues Gr eenp ea ce, the fa shion ind ustr y should b e ta ckling the und er lying p r ob lem of ov er consump tion of fa shion. Innov a tions to close the loop thr oug h lea sing offer s a nd ser v ices such a s r ep a ir s w ould b e mor e a p p r op r ia te. Denim b r a nd Mud Jea ns a nd online r eta iler L e Tote a lr ea d y offer these innov a tions to consumer s a nd they a r e on the r a d a r for mor e esta b lished b r a nd s too. M&S hop es to intr od uce r ep a ir ser v ices b y , w hile F ilip p a K ha s ha d a lea sing offer in p la ce since Aug ust L a r sson sa ys consumer a d op tion of the offer w a s initia lly slow d esp ite p ositiv e p r ess a ttention: We r ea lised w e need ed to ta lk to the customer a b out w ha t s in it for them, such a s how they could up d a te their w a r d r ob e w ithout it b ecoming ov er cr ow d ed. Althoug h the numb er s a r e sma ll, w e then sta r ted to see a cha ng e a nd imp r ov ement. Filippa K

8 Action points Consumer s w a nt to b e mor e susta ina b le, b ut need help a nd ed uca tion in or d er to ma ke b etter choices. R eta iler s need to p la y a b ig g er r ole in fa cilita ting this, thr oug h r ecycling a nd r esa le op p or tunities. As consumer s b ecome incr ea sing ly ed uca ted a b out susta ina b ility, r eta iler s w ill need to w a tch out for g r eenw a shing. They should a lso ensur e tha t if they cla im to b e r ecycling g a r ments tha t they communica te tha t it is unlikely tha t 100% of fa b r ics a r e r ecycled. B r a nd s a lso need to consid er w ha t r ole they w ill ha v e in the r esa le ma r ket. As consumer s look to second -ha nd or lea sed p r od ucts to sa tisfy their d esir e for new ness, w ha t w ill this r eq uir e fr om fa shion b r a nd s? Will it r eq uir e p r od ucts w ith g r ea ter long ev ity a nd a hig her p r ice p oint to offset few er sa les? Or w ill it r eq uir e fa shion b r a nd s to p a r ticip a te in lea sing or r esa le? S ome r eta iler s a r e a lr ea d y fa cilita ting a fter ca r e p r og r a mmes to help b oost the long ev ity of g a r ments how ca n your b r a nd p a r ticip a te in this? Marks & Spencer

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