Closing the loop in fashion - Financial Times

Talk of a circular fashion economy is everywhere, from the runways of fashion week to the hallways of the United Nations. The concept that has everyone buzzing is simple: instead of extracting natural resources, turning them into clothes, and then throwing them away when we’re done, a circular model involves not only minimising the resources used in making those clothes but also creating them in such a way that at the end of their lives they can be either reused or rejoin the natural environment seamlessly.

Céline Semaan, a co-founder of climate and culture non-profit Slow Factory, articulates the stakes well. “Everything you make returns to the earth as food or as poison,” she says. Circularity is rooted in trying to embrace the former.

It’s this approach that’s motivated many of fashion and luxury’s largest companies, including LVMH, Gucci owner Kering, H&M, VF Corp, Gap, Zara parent Inditex and Stella McCartney to pledge their allegiance to the circularity movement. They’re joined by governmental leaders in the UK and Finland, and the UN which is pushing for a circular economy that extends beyond apparel.

The word “circularity” has been appropriated by resale platforms such as Poshmark, Depop and ThredUp, which highlight the ways that buying second-hand can keep clothing in circulation for longer. It’s also being advanced by waste management-focused organisations such as FabScrap in New York and La Reserve des Arts in Paris that collect fabric scraps from design houses to keep them out of landfills. But there’s a long way to go before true circularity in the fashion industry becomes a reality.

Circularity is far bigger and more ambitious than simply recycling. According to Dr Christina Raab, vice-president of strategy and development at the Cradle to Cradle Products Innovation Institute, circularity involves thinking more holistically about sourcing, use and reuse. “Many brands still focus solely on using or increasing recycled content,” says Dr Raab. “But full circularity starts with selecting the right chemicals and materials that are not only safe for humans and the environment, but enable a high quality of materials available for future use and cycling.”

Cradle to Cradle is attempting to address this through a certification programme where it measures the “material health” of denim, dyes, elastics and other components of our clothing. The idea is that keeping a material in use indefinitely doesn’t help if the material in question is toxic, so starting with “healthy” materials is a must.

Keeping materials in use may seem logical from a business perspective — new materials cost money, and economists have argued that waste streams can be turned into revenue streams — but there are financial kinks to be worked out. While second-hand retailers have found a way to make serious money from the growing market for used goods — The RealReal has a market capitalisation of more than $1.5bn — it’s harder to turn old garments into new ones. Only a handful of brands (among them Eileen Fisher and Patagonia, which consistently create upcycled collections out of their old pieces) are even attempting to do this.

There are also design considerations beyond just the materials themselves. The Ellen MacArthur Foundation, a non-profit focused on the circular economy, has been working with more than 90 fashion brands on its Jeans Redesign Project. Some of the suggestions coming out of the programme show how big a difference simple changes can make. For instance, rivets on pockets are so difficult to remove that they can lead to the entire top of a pair of jeans being cut off and thrown away prior to recycling. So why put them in in the first place?

These kinds of tweaks might seem minor but they’re crucial pieces in the puzzle of the circular economy. According to Laura Balmond, the Make Fashion Circular lead at Ellen MacArthur, part of the challenge is that circularity can never be fully realised by one entity alone. “No product or business model is circular in its own right,” she says. “The circular economy is a much bigger idea, so it really requires the whole system to be able to operate to support that.”

That doesn’t mean businesses aren’t trying, though. Kristy Caylor is the founder of For Days, a basics brand that allows customers to swap their old For Days T-shirts and sweatpants for new ones. The company promises to make use of 100 per cent of returned For Days clothes, turning most of it into recycled thread, some of which goes into making new For Days garments.

“In an ideal world our utilisation of products, what we call consumption today, wouldn’t be ‘consuming’ things at all. We could use them whenever and however and how frequently we like without destroying anything,” Caylor says.

For Days has yet to realise that dream: though it promises to keep goods out of landfill, only 20 per cent of its products are made from recycled materials meaning by far the bulk is from virgin cotton, spandex and other new materials. Caylor says that they are trying to increase the recycled content but cites challenges in maintaining quality and durability.

That’s where the buck gets passed to material science innovators, and a host of start-ups which are promising to make fibre-to-fibre recycling more feasible.

Circ is one of these promising newcomers. The company claims that it can use “responsible chemistry” to break polycotton blends down into component parts so that both can be used again — an improvement over current chemical recycling methods that render only one material or the other usable. This fibre-to-fibre recycling is crucial to a circular approach, and, says Circ CEO and co-founder Peter Majeranowski, makes more sense than other recycled fibre options, such as polyester made from plastic bottles.

“There’s two-and-a-half times more PET being used in clothing than in bottles,” he says. “If we recycled 100 per cent of all the bottles, it still wouldn’t be able to fill that gap.” Why not, he reasons, just make the polyester for new clothes out of old ones?

Like Caylor, Majeranowski paints a compelling vision, but one that his company, which so far hasn’t hit the consumer market, has yet to realise. While Circ has influential backers such as Patagonia, Majeranowski says that the biggest obstacle for companies like his is lack of capital. He sees reason for hope though: a decade ago, there was only one public fund specialising in circularity. Now, he says, there are 10.

Closed Loop Partners is one such fund. The investment firm is focused on funnelling money toward projects that will accelerate the transition to a circular economy. (For Days is part of its portfolio, as is Evrnu, a textile innovations company, and Thrilling, a resale website.)

“There are a lot of solutions right now that are in very early stages, but to get solutions from lab to pilot to commercial requires some meaningful capital,” says Closed Loop managing director Caroline Brown, who until 2017 was the chief executive of Donna Karan.

Circular design, however, won’t solve all fashion’s environmental woes warns Matt Dwyer, vice-president of product impact and innovation at Patagonia, a brand that has long been pushing towards an ever-less wasteful business model. “Recycling has been touted as a way to perpetuate bad behaviours and overconsumption,” he says. “The rental/recommerce model, when deployed in a manner that perpetuates consumerism, doesn’t actually solve the problem that many think it does.”

Other obstacles to overcome, Dwyer notes, include a lack of infrastructure for collecting old clothes to resell or turn into fibre, and the fact that recycling itself uses energy, which sometimes comes from fossil fuels. Plus, endlessly cycling synthetics such as polyester will do nothing to solve the microplastic pollution problem.

In short: circular fashion is no silver bullet. But with growing momentum from all corners of the sector, many believe we’re on the road to a promising new era of circularity.

“We’re at the proof of concept stage,” says Balmond. “Now we need to see really bold action to scale it across all products and business models.”

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