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  • Aasavari Joshi

Reshaping the Fashion and Textile Industry through a Circular Economy Approach

From clothing to blankets and even our sofas - a world without textiles is unthinkable. They are an essential part of daily life and represent a significant sector of the world economy. Today’s fashion industry is growing at a faster pace than ever before. The value chain of the $1.3 trillion garment industry currently employs around 300 million workers.

Although clothes sales have doubled since 2000, their utilization span has significantly dropped as a result of the fast-fashion phenomena. The rise in fast fashion creates an increasing demand for fiber and textiles, as well as cheaper and faster shipping methods. This means that the global fiber production is expected to reach 156 million metric tons by 2030.

The fashion and textiles industry is one of the most polluting industries on a global level. It consumes a significant amount of water - for growing cotton, for instance – and is responsible for high volumes of pollution due to the use of toxic chemicals. According to the study “Pulse of the fashion industry” published by the Boston Consulting Group (BCG), the fashion industry generates 2.1 billion tons of waste per year. By switching to a circular system, the textile sector would be able to greatly reduce its environmental impact as well as unlock a $560 billion economic opportunity. New business models are required, as well as cross-value chain cooperation.

Why does the fashion and textile industry require a circular economy approach?

Consider the $5 item you purchased for a last-minute occasion or on an impulse and then discarded after a few months of use. Such behavior not only wastes economic opportunities, but also places a heavy burden on the resources themselves, causing a number of negative effects. The way that clothing is currently produced, distributed, and used reflects a linear economic system. Numerous non-renewable materials are used to produce clothing that is worn for a short timespan.

Today's average American produces around 37kg of textile waste annually. This amounts to around 11 million tons of textile waste produced in the United States alone. Historically, we have kept our clothes for a long time, but with the abundance of inexpensive clothing available nowadays, we view our clothes as disposable.

It is not possible to fully implement sustainable principles in a linear economy structure. Clothing companies reduce costs to increase the affordability of their items for consumers. By reducing production costs, more lines and collections can be produced per season. This approach not only degrades clothes’ quality but also creates a significant amount of waste. The transformation of the textile industry towards a more sustainable one is required. New approaches must be unlocked by creating new business models, reinventing value chains through a circular economy and adopting technologies to design out waste from the beginning.

Applying circular economy principles to the fashion and textile industry

According to The Ellen MacArthur Foundation, to mobilize industry-wide systemic solutions at scale, a circular economy approach must be advanced at an international level. The foundation describes a circular economy based on principles such as

  • managing the flows of renewable energy sources while controlling restricted supplies to preserve and emphasize capital

  • maximizing the use of resources by reusing goods, parts, and materials of the best caliber

  • enhancing system efficiency by identifying and eliminating harmful externalities

A circular system is regenerative and restorative, and it offers numerous benefits not only for businesses but also for the environment and society at large. It adopts a similar concept as recycling in that it aims to reintroduce both used products and waste in the manufacturing of new products. Products enter the economy at their peak value in a circular system and re-enter it after consumption. They do not become waste. Applied to the fashion industry, a circular approach could ensure that a clothing's full value is realized, and that once it is no longer needed, it can be reused.

If the textile industry adopted a circular model, its current negative impacts could be reduced. European experts in the field of textiles have identified several innovation areas predicted to have a significant positive impact on the sector in the years to come. These include digitization, sustainability, resource efficiency, the creation of new enterprises and the identification of new customer segments.

Different companies are adopting textile recycling, for instance, based on reprocessing waste materials into new products, materials or substances, be it for the original or other purposes. This aims to reduce virgin textile fiber production, avoid downstream processes in the textile product life cycle, and increase product circularity. Incorporating such practices could help the textile industry effectively reduce its environmental impact. Nonetheless, recycling fibers into high-quality products is difficult and expensive. Today, the separation of components and materials in manufactured products represents a challenge. A cotton shirt, for example, contains labels and sewing threads made from different materials. The separation process requires high investment and a skilled workforce.

To contribute to a cyclical production of yarn and create a connection between material and design, the Materials Experience Center (MEC), powered by Santoni, champions sustainability and material innovation. The same holds true for Italian textile manufacturers Manteco, who are working on an initiative to reduce their carbon impact, and Kornit, who are developing more direct-to-garment fabrics and waterless printing options. By investing in such innovations, the environmental impact of textile industry activities as well as the production costs can be significantly reduced.

A further positive-impact example is Reverse Resources, a digital platform that digitizes data on textile waste and connects manufactures and fashion brands. They are developing a number of projects to scale up digital solutions to build the infrastructure for textile recycling. It is an important tool, offering stakeholders of a circular system full transparency of waste flows. According to Ann Runnel, founder and CEO of Reverse Resources, their “mission is to help to bring down the cost of recycling to support the scale-up of the circular economy. The more industry members participate, the more [they] can create economies of scale".

Circular business models in the fashion and textile industry

These are just a few examples of how circular economy practices can be implemented in the fashion and textile industry. As the average quality and longevity of garments on the market will begin to increase, the possibility of harnessing its worth through new business models will equally increase.

Customers commonly value high-quality, long-lasting clothing, but are often unable to make the best decisions towards such options due to a lack of information and incentive. In the past few years, luxury fashion brands have begun to offer new technologies that enable the customization of items to increase customer value and satisfaction. This helps to ensure an extended use of fashion pieces.

A further circular business model constitutes the reselling of second-hand clothing, which is already widespread on a global scale. Clothing reselling has grown 21 times faster than clothing retail over the past five years, according to the most recent data from the ThredUp Resale report 2019. In fact, the number of customers who purchased second-hand goods grew to 56 million in 2018 compared to 44 million in 2017.

The introduction of appealing resale business models that are tailored to a wider customer base locally, therefore, offer an opportunity to increase the utilization timespan of clothing. Such clothing pieces should, in turn, be manufactured to last longer by increasing their quality. Finally, textile recycling offers a solution for garments that are no longer wearable. These are transformed into new textiles and garments and re-introduced in the market.

What steps can you take individually to support the transformation of the fashion and textiles industry towards a circular industry?


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