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“Circular Fashion: Making Resale a Reality” from March 2024 discusses the fashion industry’s challenge in reducing its environmental impact, emphasising the potential of circular models like repair, resale, and recycling to decouple consumer demand from raw material extraction.
Resale models, which retain about 25-40% of an item’s selling price in the secondary market, are shown to offer significant environmental benefits compared to recycling.
However, profitability remains a challenge, particularly for items with low resale value.
The report outlines strategies for fashion businesses to enhance resale profitability, including improving customer propositions, reducing costs, and increasing product durability.
It highlights the varying success of resale models across different brand segments, with premium and luxury brands more likely to profit from resale due to higher value retention.
The report suggests that shifting towards circular fashion models can help the industry address its environmental challenges while potentially unlocking new economic opportunities in the secondary market.