Comment: Circular economy will be driven by consumers
The circular economy sounds great, with its focus on reuse, resale and the refurbishing of clothing as an alternative to the manufacturing of yet more new products from virgin materials.
We’re all in favour of it because it can have a seriously positive impact on the environment and retailers and brand owners are all playing around with various circular economy initiatives.
But the reality is that it’s proving incredibly hard for any organisation to gain any great traction and drive significant volumes and profits through these new ways of operating. The bottom line is that flogging new products continues to wholly drive the bottom lines and top lines of all fashion and clothing players. The EU has taken note of the lack of progress being made across the continent that is putting its climate target of net zero emissions by 2050 under great pressure.
Its plan for 2030 has been to have all textile products imported into the EU be long-lived and recyclable, to a great extent made of recycled fibres, free of hazardous substances and produced in respect of social rights and the environment. That sounds like no small-time objective to me. To achieve its aim it is putting together changes to legislation, devising awareness campaigns, and looking to force the clothing industry’s stakeholders to pay for the treatment of waste textiles.
This is all laudable but it’s going to be incredibly difficult for this to work coherently and effectively across the incredibly complex landscape of the global clothing and fashion industry. Even if the EU can bring the European fast fashion players like Zara, H&M, Primark and Boohoo to change their activities to being more circular the likes of China-based Shein will prove a wholly tougher nut to crack.
Such operators have proven adept at identifying tax loopholes and operating their manufacturing and supply chains in such ways that it enables them to profitably sell products at incredibly low prices. There is little chance they will fall wholly in-line with a new regime that has recycling and reuse at its heart. They are no doubt clever enough to sidestep legislation. And should the likes of Shein lose its lustre as the go-to for cheap, short life fashion then there will likely be another new player come along to fill its place.
Arguably, the only way the circular economy will take hold in any meaningful way is through changes in customer behaviour. It’s simply too big a challenge without having consumers engaged in a much bigger way than is currently the case. There is no doubt that many people want to live a more sustainable lifestyle but continue to – not surprisingly – be distracted by short life clothing at low prices.
Younger consumers are most on-board with sustainability and buying second hand, which bodes well for the future, but they are also the same grouping that continues to fuel the high sales at the fast fashion giants. They have feet in both camps so maybe the EU and other interested parties along with sustainably-focused brands and retailers should focus their attention on nudging this grouping further into the circular economy camp.
One thing that is widely understood is that virtually none of these millennial and Gen Zers are buying second hand because of the environment upside, it’s always about bagging an attractive price. The sustainability aspect is secondary and represents something of a bonus to them. Maybe this important dynamic could be harnessed to determine a route to affect change among these vitally important consumers. There is no obvious solution to accomplishing this shift in behaviour but it is this grouping who will ultimately determine the success or otherwise of a wholesale shift towards consumption based on the principles of a circular economy.