Operation: Retail Waste Recovery
Let’s start this post with one sobering statistic: According to Vogue magazine, fifty million tons of clothing end up in landfills every year.
That’s right. Fifty million tons.
Let’s now look at this set of facts. Thanks to falling costs, streamlined operations, and rising consumer spending, clothing production doubled from 2000 to 2014, and the number of garments purchased each year by the average consumer increased by 60 percent.
That’s right. 60 percent.
This rise in clothing consumption is particularly eye-opening because apparel accounts for less than 10% of the total retail volume in the US.
I don’t know about you, but I see a clear link between consumption and waste here, and it makes me wonder what role brands and the retail industry—the sources of the problem—can play in closing this massive loop of, well, garbage.
A good place to start is product design.
Toward Eco-Friendly Design
According to an Accenture report, 80% of a product’s environmental impact is influenced by the design process. Therefore, brands and retailers need a deeper understanding of how their creations affect the environment—especially at their “end-of-life”—as well as greater exposure to circular design alternatives.
The good news is, as the focus on consumer waste has grown, so has the interest in more eco-friendly design. Brands and retailers are now beginning to design with that end-of-life in mind.
Often cited as a prime offender in the growth of the “fast fashion” trend, Zara’s parent company, Inditex, recently committed that by 2025, its brands would only use organic, sustainable, or recycled materials for cotton, linen, or polyester substrates.
Likewise, H&M has promised to source only sustainable or recycled raw materials for all their products by 2030.
But beyond these commitments, apparel brands are also offering textile recycling to keep clothing out of landfills. Brands such as Madewell, Levi’s, and The North Face are joining H&M and Zara in this essential effort to reduce waste.
Without question, the energy is shifting.
By using recycled raw materials, as well as offering solutions for consumers to recycle their used clothing, these retailers and brands are building a flywheel to change inputs (creating demand for recycled materials), infrastructure (creating collection methods for clothes to be recycled) and most importantly, building new behavior patterns and affinity with their customers (creating awareness and action in building new recycling habits).
What’s more, creating this demand for recycled materials will also reduce their costs. And as the costs for these recycled materials decrease, demand for them will increase—and the virtuous loop of radically reduced waste will continue to build in scale and volume.
Funny how that works, isn’t it?
The Resale and Sharing Economy
Retailers and brands are also keeping waste out of landfills by changing the business model of “owning.” Before the coronavirus outbreak, the growth of the resale market was impressive, exciting consumers and winning recognition from some of the most notable voices in fashion, including Anna Wintour.
But now that the virus is here, growth is positioned to be off the charts.
According to Business of Fashion, “Before the pandemic hit, the resale market was on track to double. Now, this growth may very well accelerate. Resale sites are coming out big winners as the pandemic plunges the economy. Analysts predict consumers will turn to sites like thredUP and Rebag to clean out their closets for extra cash . . . and stuck at home and worried about their finances, they’re hunting for bargains online.”
According to thredUP’s 2020 Resale Report, the second-hand market for clothing is set to exceed $60 billion in the next five years and will exceed the traditional thrift and donation segment by 2024. Most stunningly, this second-hand market will be bigger than fast fashion by 2029.
And this trend goes beyond clothing.
More than 70% of Gen Y and Gen X shoppers are willing to take part in the sharing economy. Apparel and accessories top the list for many. But other categories are in the mix, too, including furniture and appliances such as refrigerators.
As consumers seek more flexibility in their careers and lifestyles, they are also looking for ways to consume and own less. Retailers and brands that actively support these interests will be well-positioned to develop deeper customer loyalty and gain more of the consumer’s dollar.
The End of More?
In a recent podcast, Seth Godin postulated that industrialism had a problem: Factories got better at making things than people were at buying them.
We now appear to be on the cusp of reversing that trend.
Instead of wanting more, consumers want to buy (or rent) less, keep what they have for longer, and find ways to regenerate their waste. This, in turn, may translate into less revenue for retailers and brands, especially if they are unable to grow their consumer base.
But the enthusiasm for this new model of “less, not more” is building.
We all know about the big graveyard of once-great companies that chose to ignore innovation and the demands of their customers (*cough* Kodak *cough*). But retailers and brands that choose to lead the charge in reducing waste—and contribute to the momentum of the circular economy—will meet no such fate. They’ll be able to guide the conversation, have the most significant impact, and build the deepest loyalty instead.
That’s who I want to buy from and work for. How about you?