Why circular supply chains are the future of fashion

In today’s fast-paced and ever-changing world of fashion, traditional linear supply chains are being reshaped by the rise of circular business models. As sustainability is an increasingly important aspect of the industry, fashion brands are rethinking their approach to production, distribution, and consumer involvement. The circular supply chain of the future presents a new way of doing business, one that focuses on minimising waste, maximising resource efficiency, and promoting a more harmonised, sustainable and ethical industry.

EU Legislation on textile waste

The EU has taken a major step towards tackling textile waste with new rules that hold producers accountable for the lifecycle of their products. Under the agreement, companies selling textiles in the EU will have to finance the collection, sorting, and recycling of discarded clothing, footwear, and household textiles. This move, known as Extended Producer Responsibility (EPR), will apply to all brands — including those selling online — regardless of their location. Smaller businesses will get an extra year to comply. The directive also encourages countries to target ultra-fast fashion, ensuring that brands contributing the most to overproduction and waste pay higher fees. With the EU generating 12.6 million tonnes of textile waste annually, of which less than 1% is recycled into new products, these regulations mark a crucial shift towards a more circular fashion system.

Understanding Circularity in Fashion

Circularity in fashion refers to designing, producing, and consuming clothing in a way that is more harmonious with nature and its resources. Instead of disposing of products in landfills at the end of their traditional use, circular supply chains seek to create a closed-loop system where everything is created and used with its next stages already in mind. This concept is crucial not only for eliminating the huge negative environmental impact of fashion but also for using resources optimally in a manner that benefits both nature and humans. 

Fashion Supply Chains and Circularity

The following table illustrates circularity throughout a garment’s production status, starting from the linear economy at the bottom to the ideal scenario of circularity integrated into the design phase of garment production. 

At the top of the table, the most circular and sustainable practices are listed, starting with refusing and rethinking the need for new garments. This involves designing products that do not require new resources or raw materials, or choosing to not produce new items at all. This also involves designing products with the entire life cycle in mind, considering durability, recyclability, biodegradability, etc. As we move down the ladder, circularity practices during the consumption phase are highlighted, such as reusing, repairing, and refurbishing garments. In the next stage, circularity at the end of a garment’s life cycle is stated, recycling and recovering materials ensuring that they don’t go into a landfill. The bottom of the table represents the linear supply chain, where no circularity is practised, and garments and materials end up in landfills.

In order to move from the bottom of the table to the ideal top, the entire fashion supply chain needs to be upheaved and rebuilt. A traditional fashion supply chain consists of 4 tiers:

• Tier 4: Fiber Processing. This is the first stage of the textile production process. This includes the sourcing of raw materials, like harvesting and processing natural fibres, and the first stages of fibre production for synthetic fibres.
• Tier 3: Yarn and Fabric Production. These steps process fibres into fabric. This includes spinning, knitting, weaving, throwing, and texturing. (For the leather industry, this includes animal slaughtering and wet processes.)
• Tier 2: Fabric Finishing. These are the steps taken to finish the fabrics, including washing, dyeing, printing, bleaching, embroidery, etc.
• Tier 1: Garment Production. This includes the assembly, sewing, cutting, weaving and knitting of the garments. Including the packing for shipment towards the retailer and/​or customer.

These tiers are fundamental to the current linear supply chain, but introducing circular practices is bound to disrupt this structure. Circularity involves degrowth, which refers to the intentional reduction of production and consumption to achieve sustainability. So in the ideal circular supply chain scenario, tiers 3 and 4 will be downscaled drastically, while the focus shifts to using already existing resources in their optimal capacity. This would mean a significant reduction in the manpower needed for tiers 3 and 4, putting many out of jobs and severely affecting the economy if not done carefully. But while some tiers are minimised, other tiers can be introduced, such as for garment/​material upcycling or repurposing for different use, or reintegrating it into nature. There would also be an increased need for intellectual and technological advancements. This, altogether, would introduce new jobs and opportunities, for example, farmers and garment makers can be retrained for roles in repair, resale, and recycling sectors. Governments and industries must plan for a gradual transition, providing training and new job opportunities in the emerging circular economy. For example, an action plan might include incentives for businesses adopting circular practices, educational programs for workers transitioning to new roles, and investment in recycling and repair infrastructure.

The current tiers generally used to structure the textile production process are sometimes already up for discussion. Some suppliers or processes can be classified into several tiers, depending on the product itself. 
With the rise of new upcycling and recycling processes, this discussion becomes more significant. Where do you classify a manufacturer that processes marine waste into new nylon fibres and yarns? Or a brand that upcycles old tarps into bags? This begs the question, is this system still relevant?

A consumer-involved approach is also necessary for this transition. Consumer usage of the garments is crucial in maintaining the closed-loop system. So they need to be involved in this transition and provided with incentives and resources to participate in healthy usage of the garments, such as repair, recycling, resale, etc. This also fosters a sense of ownership and responsibility, inspiring them to be more mindful of their consumption choices rather than leaving it all up to the brands and manufacturers.

So, instead of maintaining a linear way of thinking, why not use a circular system throughout the whole industry? This way consumers are automatically included in the process, ensuring that manufacturers look further than the ​‘start’ and ​‘end’ of their own parts.

Envisioning the Future

Imagine one day, when it is easier for you to discover your own style, easier to choose fashion for self-expression rather than for staying on trend. A future where access trumps ownership, and each piece you wear is personal and special, and you are aware of the source of every fibre in the garment, of every hand that worked so hard on it. Where your garment is a part of your identity, so you are willing to go the extra mile to keep it in its best quality, to repair or upcycle it when needed. And if the sad day comes when it is too far gone to keep using, you know exactly where it needs to be taken for it to be given the new life it deserves, in whatever form it may come. This is the future circular fashion is trying to bring to life. A world where the concept of ​“throwaway fashion” will become obsolete. This vision requires a collective effort from brands, consumers, and policymakers to make sustainable fashion a reality.

In conclusion, the transition to circular supply chains in fashion presents both challenges and opportunities. By rethinking traditional practices and embracing sustainability, the industry can pave the way for a more ethical and environmentally friendly future.