Revolutionizing Fashion: Embracing Circular Business Models for Sustainable Growth

Transformative Circular Businessfor Fashion Industry Growth

Introduction:

The fashion industry has been growing significantly in terms of production volume while witnessing shrinking profit margins and heightened environmental impacts. By 2015, clothing production doubled compared to the year 2000, with utilization-the frequency an item of clothing is worn before disposal-dropping by a staggering 36. This tr led the global fashion industry to produce approximately 2.1 billion tonnes of greenhouse gas GHG emissions in 2018, contributing around 4 of the total global GHG emissions pool. Moreover, during this time period, leading apparel retlers have seen an average profit margin decline by 40 from 2016 to 2019. This was further exacerbated by the impact of the COVID-19 pandemic in 2020, which exposed the fragility of fashion supply chns and resulted in a shocking drop of profits amounting to 90 compared to the previous year.

The Time for Transformation:

In recent decades, there has been an increase in clothing production alongside declining profit margins, coupled with growing environmental impacts. The current linear businessprioritize new product creation over usage longevity, leading to increased waste and resource depletion. The fashion industry is ripe for transformation into circular business, which focus on reducing waste, promoting material longevity, and fostering sustnable value.

Key Actions for Circular Business:

To fully harness the potential of circular businessin fashion, businesses must take four pivotal steps:

1. Reform Performance Indicators and Customer Incentives:

   Adopting practices that emphasize increasing clothing use duration over sales volume can redefine success metrics. This shift encourages sustnable consumption patterns, such as rental services or second-hand markets, which offer financial incentives for customers who engage with circular economy principles.

2. Design Products to Last Longer:

   Creating products designed for exted usage necessitates a focus on durability and reprability from the outset of product development. Such designs should prioritize longevity and functionality over tr-driven aesthetics, enabling consumers to reuse items for an exted period without compromising style or quality.

3. Co-create Supply Networks:

   Traditional supply chns are optimized for linear flows, which can hinder circular business. By fostering local and global networks that facilitate services such as cleaning, repr, and remanufacturing, businesses can streamline their operations to support circular practices effectively.

4. Scale a Diverse Range of Circular Business:

   While rental, resale, repr, and remanufacture have gned significant traction thus far, there is potential for exploring otherthat decouple revenue streams from production and resource use. This includes promoting innovative platforms like product-as-a-service PaaS or sharing economy solutions that offer customers access to products rather than ownership.

:

Redefining growth within the fashion industry through circular businesspresents a significant opportunity to address environmental challenges while fostering economic prosperity. By embracing these transformative practices, businesses can contribute to a more sustnable future, promoting reduced waste, increased resource efficiency, and enhanced consumer satisfaction.

Reference: Ellen MacArthur Foundation, Circular Business: Redefining Growth for a Thriving Fashion Industry, 2021

This revised version offers a structured outline of the article's core points while mntning and clarity. It emphasizes the need for transformative changes in fashion businessby highlighting key actions that could lead to sustnable growth within the industry.
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