Despite big talk about sustainability and circularity, fashion brands are making little progress when it comes to closing the loop.
Apparel companies continue to push more products onto the market, and consumers continue to consume. “Sadly, the paradigm is still pretty much linear,” according to Kearney’s Circular Fashion Index for 2023 (CFX), titled “Consumers Don’t Know and Brands Don’t Act.”
Shoppers don’t really know what constitutes a sustainable product, nor do they understand how they can champion circularity, Kearney found. Nearly half of respondents to a survey conducted in the U.S., France and Italy said they didn’t know whether virgin products were better or worse than recycled ones, and between 30 and 40 percent said they weren’t aware of product upcycling efforts or how they could return unwanted clothing to be recycled. As a result, the industry has been “largely unresponsive” when it comes to moving toward a more circular supply chain.
Kearney queried 200 leading global brands from 20 countries across the sports and outdoor, intimates, luxury, premium, mass market and fast fashion sectors between February and March, scoring them on the use of recycled materials, availability of repair and maintenance services, facilitation of secondhand or rental services, and the reuse of returned clothes as raw materials. The average CFX score across all respondents was a 2.97 out of 10, little better than 2022’s similarly dismal results.
The Kearney report shows that brands are still focused on making new products rather than promoting the secondary market, which addresses a product’s post-consumer fate. Addressing both requires a change of mindset from both brands and consumers, Brian Ehrig, Kearney partner and CFX co-author told Sourcing Journal.
“For businesses, they must start with circularity—repairable, reusable, recyclable, resaleable—in mind when they are designing their products,” he said. “For consumers, they need to be educated on how to take care of their clothing, how to think about repair as a feasible option rather than throwing something away, and how to use their own closet as a source of value through resale.”
A few key players have been dominating the leader board in recent years. Patagonia took the No. 1 spot, as it did in 2022, for its efforts to promote circularity through design and development as well as post-consumer solutions like its Worn Wear resale program, earning a score of 8.65. It prioritizes non-virgin materials—36 percent of its cotton, and 90 percent of nylon is recycled, Kearney research showed. Since the last CFX assessment, Patagonia better communicates with consumers about how they can promote circularity, and it has started evaluating products on a 10-point scale based on their repairability, durability and functionality to pinpoint areas of redesign and minimize environmental impact.
Levi’s (8.3) and The North Face (7.9) maintained the No. 2 and No. 3 spots on the list year over year, followed by Italian lifestyle brand OVS, Gucci, Madewell, Coach, Esprit and Swedish fashion chain Findex. Levi’s was credited for extending the life of its denim with its Levi’s Tailor Shops, and its use of recycled and regenerative raw materials. Meanwhile, The North Face is working harder to restore and sell pre-owned goods via its Renewed channel. Also prioritizing resale is Madewell, which launched its Madewell Forever program with ThredUp in 2021.
While just 5 percent of assessed brands were found to have an extensive breadth and depth of pre-owned garments within their assortments, 27 percent were found to have a moderate amount of such products up for sale, demonstrating the increasing power of resale as a driver for circularity. Athleta was credited for demonstrating strong year-over-year improvement in the CFX study due largely to its partnership with ThredUp and the creation of its own secondhand sales channel.
“It certainly helps, but let’s be honest, resale is the easy part and it’s addressing a very small amount of the supply of used fashion items out there,” he said. “The other point is resale primarily works for premium to luxury brands, or with highly durable items,” like camping gear, for example. “It doesn’t really work well for value brands or fast fashion. Those aren’t the brands consumers want secondhand,” Ehrig said. “That said, businesses need to be thinking about resale as a tool available to them and use it as such.”
Premium and luxury brands have also been increasingly adopting recycled fibers and materials during the design and development process—a trend that is “definitely starting to happen” in a bigger way in recent years, Ehrig said. While just 2 percent of the 200 brands surveyed were found to be doing so extensively, 65 percent reported that a moderate share of garments produced were made using recycled inputs.
Recycled materials are in short supply, even for brands that want to use them. “Each year we see more happening to create the feedstocks out of old clothing through various forms of recycling,” he added. “If we can do this plus collect more of the waste to feed a steady supply, that would get us a long way to where we need to be.”
New material innovations that replace fashion’s more harmful inputs also represent an area for growth. H&M’s investment arm, H&M Group Ventures, has invested heavily in material and process innovation in recent years. Through the program formerly known as Co:Lab, the Swedish fast fashion firm on Thursday announced an investment in bio-based materials science company Kintra Fibers. The startup’s biodegradable, bio-based alternative to traditional polyester aims to mitigate fashion’s reliance on planet-polluting, fossil-fuel-based synthetics.
Overall, only 19 out of 200 surveyed brands scored at least a 5 out of 10 on the Index, and only the top three scored above 7 out of 10. “This is simply not good enough to significantly offset the industry’s environmental impact,” according to Kearny. It cited a lack of traceability, inconsistent impact measurement, and a lack of clear and measurable environmental targets as reasons for the stagnation.
New legislation could force change across the global fashion supply chain. “We are already seeing this happen in Europe, and there are signs of it in the U.S. such as with The Fashion Act proposed in New York,” Ehrig said. Brands doing business in Europe that make shifts to comply with that regional legislation will likely make changes to their overall operations and assortment. “They will be forced to move to globally sustainable items,” he said. “The hope here is that we can come up with a global standard so that it’s not difficult for the brands to comply.”