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Resource Type: Blogs


Circular Fashion: Exploring the Future of Sustainable Business

Circular fashion helps retail businesses minimize waste, maximize resource efficiency, and promote sustainable efforts throughout the lifecycle of a garment. Learn how adopting this strategy can help you thrive in the competitive retail market.

August 18, 2023

5 min read

Anastasia Hamurari

Did you know that the fashion industry emits nearly as many greenhouse gases in a single year as the economies of the United Kingdom, France, and Germany combined?

This statistic alone serves as a major wake-up call for fashion businesses to rethink their business strategy in line with the rising environmental concerns.

Consumers are just as aware of the need for sustainable business practices to replace traditional business models. In fact, 67% of consumers view sustainable materials as an essential purchasing factor when deciding which fashion brand to buy from.

The combination of fast fashion’s harmful impact on the environment and the increased demand for more ethical business practices calls for serious consideration of adopting a sustainable strategy when running a fashion business.

This article will cover the basics of circular fashion, including defining what it means, exploring its benefits, showcasing sustainability initiatives in the industry, and offering tangible ways your brand can become more sustainable, starting today.

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What is circular fashion?

Circular fashion refers to an environmentally conscious approach to producing clothes, shoes and accessories, one that is mindful of the waste and pollution created in the process.

It consists of a closed-loop system where the circulation of fashion items is prolonged, and reuse is encouraged. Both the creation of an item and the end of its lifecycle are important, with the materials and the supply chain thoughtfully considered and evaluated. 

The term has emerged from the intersection of circular economy and sustainable fashion.

The circular economy is understood as a production and consumption model that aims to minimize waste and maximize the efficiency of the resources used. Described as fashion items that are produced and distributed in an eco-friendly way, the notion of sustainable fashion has only started attracting mainstream attention in recent decades.

What are the benefits of circular fashion?

Embracing a circular fashion business model brings a variety of attractive benefits that extend beyond style and trends.

In this section, we’ll dive into the most important reasons you should consider when committing to an ecologically conscious way of operating a fashion business.  

Reduction of waste

Close to 100 million tons of textile waste is produced every year. With this figure projected to increase by approximately 60% in the next 7 years, brands are being pushed to develop ways to reduce waste.

In practice, circular fashion deals with the issue at each phase of the fashion lifecycle. This system advocates for conscientious manufacturing, recycling and upcycling textile waste, and prolonging the viability of garments through reuse and repair.  

Conservation of resources 

Thanks to the circular fashion approach helping with maximizing the resource value, the tendency to use fewer raw materials leads to resource conservation. As a result, natural resources like energy, water and cotton end up being used less, and the environment can rejuvenate.

The best part – you're able to run your fashion business whilst easing the strain on the earth’s natural ecosystems, protecting them from the toll of extracting resources.

Long-term cost savings

Profit maximization is the goal of every commercial business. One of the most amazing benefits of the circular fashion economy is despite the required upfront investments, it has long-term cost-saving benefits for your company.

By recycling, repairing and reusing, you close the loop on production and, as a result, cut expenses related to extracting raw materials, transportation and the management of waste.

Consequently, circular fashion helps to reduce operational spending and ensure long-term financial resilience. 

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How to become sustainable as a fashion business

As carbon slowly goes out of fashion, brands are seeking tangible ways to adopt more sustainable business practices. More than just a trend, sustainability is now viewed as a pivotal business strategy worth pursuing.

Here, we will give you some actionable points for how to transition toward a more sustainable and environmentally responsible model. 

Embrace resale and rental

The resale market is outpacing traditional retail 11-fold and is forecasted to reach a value of $84 billipn by 2030. Partly due to the appearance of easy-to-use resale companies like Vinted and Preloved, this way of shopping aligns with the fashion industry’s sustainability ambitions.

The rental business model takes it one step further by allowing shoppers to rent an item for a few days, weeks or a month. This rise of fashion rental offers a multitude of environmental benefits for companies whilst achieving the same dopamine release for hungry-for-new consumers. It’s a win-win for both parties (and for the environment).  

Ensure supply chain transparency

It’s not solely about the final product being sustainable. You must make sure every step of the production process, from extracting raw materials and manufacturing the items to transporting and storing them, is just as sustainable.

With the retail supply chain contributing to 25% of greenhouse gas emissions worldwide, it’s important to develop environmentally friendly supply chains that rely on eco-conscious fabrics and processes all while reducing inefficacies. THG Ingenuity’s fulfillment solution can support brands with this.

Powered by customer-centric technology, seamless customer experiences enabled by THG Ingenuity are built on more than just standard delivery. Our warehouse management system has capabilities extending beyond managing your inventory.

We use software automation to improve operational efficiencies so that your consumers get their orders on time and in the most sustainable way possible. See Cult Beauty offering eco-friendly delivery options at checkout below. 

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Address the concerns of your consumers 

Returns are problematic not only for retailers but also for the planet. In the UK alone, consumers return £7 billion of online purchases on a yearly basis. What was once viewed as solely a financial issue is now acknowledged as damaging to the environment, too.

Regardless of whether the cause for the return is a poor fit or the wrong style, consumers become less approving of the return policies that facilitate the industry’s horrific waste management issues (i.e., landfill waste).

As many as 40% of buyers would like their garments to be manufactured from recycled materials. Similarly, 44% of shoppers believe that retailers should steer clear from using harsh chemicals in manufacturing.

This is all to say that listening to your consumers as a fashion brand can be a game changer for staying profitable and sustainable at the same time, all whilst improving brand sentiment and customer loyalty

Use regenerative fabrics in production

It’s not enough to only use recycled and upcycled fabrics anymore; doubling down on using materials that benefit our ecosystems is a tactic that deserves your consideration.

Take Stella McCartney’s SS23 collection, where the designer employed regenerative cotton that’s known for its biodiversity-improving properties. Although this innovative type of fiber isn’t currently easily accessible to everyone, the widespread curiosity and its slow incorporation into runway collections are promising for the retail industry. 

Don’t engage in greenwashing 

It’s better to not make any sustainability claims if you can’t back up with data to maintain brand authenticity and position yourself as a sustainability-minded business in the industry.

That is, you must ensure that if your green claim was challenged, you’d have enough evidence to substantiate it. For instance, if you state that the product is 100% recyclable, you or your supplier must provide proof of this.

To avoid greenwashing, be honest about your sustainability efforts. Along with cleaning up your operations and supply chain, use direct language to communicate your plans to consumers. The fewer exaggerated statements you make, the more trust buyers will have in you.

Circular fashion: a blueprint for a sustainable future

In the grand scheme of sustainability, circular fashion presents as one of the best solutions to the environmental issues the fashion industry is currently facing. Founded on the basis of a circular economy, it can revolutionize the production and distribution of clothes, shoes, and accessories in a way that doesn’t harm the environment.

Through a commitment to minimizing waste, optimizing resource use, and redefining consumption patterns, retail businesses can create a fashion legacy of renewal and recycling for our planet – all while maximizing their profits.

Enter THG Ingenuity’s global fulfillment and delivery solution that can help you get there faster.

We provide your consumers with a seamless shopping experience that starts at the checkout and ends at the shoppers’ doorstep. From delivery and courier management to warehouse automation and omnichannel customer service, THG Ingenuity has got your brand fully covered.

Whether your goal is to decrease emissions when shipping out items or delegate inventory management so that you can focus on your broader sustainability objectives, our modular operational solutions are at your disposal.

Get in touch today and learn how you can improve your sustainability credentials as a fashion business in the modern, environmentally aware retail space.

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