Circular fashion is resale of used garments

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Moda circular es reventa de prendas usadas-gabrielfariasiribarren.com
pair of leather hiking boots at a flea market

This is the fourth article in a series of five. Of course, I suggest reading the first three reports to fully understand the content of the fashion industry leaders’ commitment to circular fashion and the toolboxes that Global Fashion Agenda has created and made available to signatories to achieve the proposed goals.

2020 Circular Fashion System Commitment | Circular Fashion is Circular Design | Circular Fashion is Collection of Used Garments

In this article we will analyze toolbox number three and in the link at the end you can download its full content.

Tool Box #3: Resale of used garments.

Moda circular es reventa de prendas usadas-gabrielfariasiribarren.com

This toolbox is designed to support and collaborate with fashion brands and retailers who wish to explore resale strategies within their own company. It highlights the role of reselling used garments in creating a circular fashion system and aims to redefine the life cycle of garments by giving them multiple lives.

Getting information on the need to resell

The resale of used garments is increasingly important as clothing is often discarded long before it becomes worn out.

  • As an extension of the current value chain, resale helps to ensure that the final destination of the garments is not landfill or incineration.
  • Integrated business models. The possibilities of reuse and resale are predicted to increase, due to economic and environmental benefits.
  • The fashion industry has the opportunity to lead the transition to a circular fashion system where the resale of used garments is an essential part of value creation.

Key learnings:

  • Product reuse ranks second in the European Union’s waste hierarchy, which means it has the second lowest environmental impact, right after waste prevention.

  • Resale offers opportunities to capture value from existing products.

  • It is estimated that clothing demand will increase by 63% in 2030. According to current developments, the resulting increase in environmental and social costs may lead to a decrease of more than three percentage points in industry profits before interest and taxes. This means further margin erosion.

Opportunities linked to the resale of used garments.Moda circular es reventa de prendas usadas-gabrielfariasiribarren.com

Extending a garment’s life cycle by just nine months through resale reduces waste, water and carbon footprints by 20-30% each and reduces resource costs by 20%. Resale also offers the opportunity to make a profit by selling the product more than once. From a broader perspective, implementing resale strategies in a circular fashion system leads to new jobs, particularly in collection, sorting and second-hand retailing.

Challenges of resale

The most apparent challenge to resale lies in limited access to used clothing and related uncertainties about the time, quantity and quality of garments from clothing collection schemes. In addition, consumers’ perception of used clothing can affect the success of a resale initiative. In general, these challenges influence the profitability of starting a resale channel.

Current state of resale

  • At present, the share of the apparel resale market is USD 20 billion and it is expected to gain a market share of USD 41 billion by 2022, making it the largest second-hand market compared to other industries such as electronics or books.

  • Ninety-five percent of the clothing discarded could have been reused or recycled.

  • It is estimated that garments are worn seven to ten times before being discarded.

  • 44 million women bought second-hand items in 2017, an increase of 9 million compared to 2016.

The strategy: creating a resale channel for used garments.

Moda circular es reventa de prendas usadas-gabrielfariasiribarren.com

Resale is an opportunity to integrate circularity into your business model. To generate the greatest profits, your resale channel must be aligned with your product range and garment collection scheme. Since not all products are equally suitable for resale, it is worth considering how to manage collected items that are not reusable.

Key learnings

  • Current experience shows that reselling high quality clothing is a success.

  • The main considerations in developing a resale channel are that it must be supported by its garment collection scheme, use available resources and align with your current business model and sustainability strategy.

  • Seven resale strategies are currently more prominent in the industry: online thrift stores, online resale platforms, second-hand retail, sales for redistribution, collaboration with charities, partnership with a solution provider and rental services.

Exploring resale opportunities.

To discover how resale fits into the company, it is important to engage with various departments to determine what is realistic for the size, structure and product range of the organization, for example. You should also make sure you have a clear idea of the costs, logistics and objectives for setting up garment collection.

Questions to consider before developing a resale channel.Moda circular es reventa de prendas usadas-gabrielfariasiribarren.com

  • How can the resale channel fit into the overall business model?

  • How can resale align with current sales channels? Physical and online store?

  • What resources are available to set up a resale channel?

  • What financial, environmental and social benefits should result from resale?

Two business models that include reuse.

Eileen Fisher

This company resells garments through its Renovate initiative. Most of the collected items are in excellent condition and can be resold after sorting and cleaning in internal facilities.

Vigga

It is a rental service that provides maternity clothing and children’s clothing through a monthly subscription. The idea behind the concept is to share and distribute high quality products at a reasonable price to increase utilization. As children quickly outgrow their clothes when they are young, Vigga provides the opportunity to have an open and flexible wardrobe while reducing the negative effects associated with manufacturing.

Inspirational Industry Cases

 Moda circular es reventa de prendas usadas-gabrielfariasiribarren.com

Case study: Nudie Jeans.

As a signatory to the 2020 Commitment, Nudie Jeans plans to increase annual sales of its used jeans by 30% in 2020 compared to sales in 2017. Nudie Jeans chose to set this goal to take the next step in developing its brand from second-hand jeans, called Re-use denim.

This initiative has proven to be a success for Nudie Jeans, with sales up by 40% in January and February 2018, compared to an average month in 2017, indicating good results towards its ultimate goal. Several methods have been used to increase the sale of Re-use denim, such as improving communication with the customer in the Re-use denim range, adjusting Re-use denim displays in the store and creating Re-use-specific posters for the stores. All these actions positively affected sales by making the message clearer and jeans more accessible to customers.

In 2018, Nudie Jeans also launched the concept of online reuse, allowing customers to find reused and repaired denim in the Nudie Jeans online store.

Case Study: Patagonia

In 2017, Patagonia launched wornwear.com, an online store of used but high quality Patagonia apparel. Customers return items from Patagonia that they no longer use to the store and receive store credit. Patagonia then inspects, repairs, cleans and restores the items before placing them on wornwear.com. Prior to the launch of the site, Patagonia created an inventory they thought would last a month or more, but it ran out in 36 hours.

Patagonia has partnered with Yerdle to improve and expand its re-commerce initiative, manage returned garments and improve logistics. The resale of used goods has environmental and economic benefits for Patagonia, so the initiative is expected to expand further and into other markets.

“We were positively surprised that approximately 80% of buyers turned out to be new customers, mainly representing Millennials, who may not be able to pay for new things but still want to align with our brand.  Rick Ridgeway – VP Public Commitment – Patagonia.

Download the report “Global Fashion Agenda 2020 – Resale Toolbox #3” here

This download is for registered users only.
Click here to

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Profesional de la industria de la moda con una importante trayectoria en las áreas de aprovisionamiento, compra y producción de textiles y accesorios en América del Sur, Europa y Asia. Moda Sostenible para una industria textil responsable.

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