Circular Fashion: How Brands Make Money Selling Less
EPR rules are making brands financially responsible for garments after they are sold. That sounds like a cost. We would argue it is the moment resale and repair start making commercial sense.
The objection we hear most from mass-market fashion brands is straightforward: if we sell clothes that last, we sell fewer clothes.
It is a reasonable worry and we think it misreads what circularity actually does to the revenue model.
Extended producer responsibility changes the arithmetic
EPR rules make a brand financially responsible for its garments at end of life. Once that cost lands on the balance sheet, the calculation behind durability changes — a product you will pay to dispose of is different from one you will not.
That is the mechanism worth understanding. Circularity stops being a values argument at the point where the linear model starts carrying a fee.
The same garment, sold more than once
Resale is the clearest version. Second-hand transactions in your product are already happening on someone else's platform, and the margin is going there.
A branded resale channel captures that margin and converts a one-time sale into a recurring asset. It also gives you a data relationship with the second and third owner, which most brands currently have no visibility of at all.
Repair works similarly, and does something resale does not. A repair is a service interaction — the customer arrives with a problem and leaves with it solved, which is a considerably stronger loyalty event than a discount code.
Design decides whether any of it is possible
None of this works if the garment cannot be taken apart. A mono-material shirt can be recycled; a blended one with bonded trims largely cannot, whatever the label says.
Which makes design for disassembly the least visible and most decisive part of the playbook. It is also the hardest to sell internally, because the cost is immediate and the benefit is years away and lands in a different department.
What we are not sure about
We do not know whether resale genuinely reduces production or simply adds a second revenue stream to the same volume. The honest answer is that the evidence is mixed and depends heavily on whether resale displaces a new purchase or adds one.
If it turns out to be mostly additive, a lot of circular fashion marketing is overclaiming, including some we would have been sympathetic to.
Where we have got to
The brands we would watch are the ones treating circularity as a change to the business model rather than a line in the sustainability report.
If you are trying to make that case internally and the numbers are not landing, we would be glad to think it through with you.
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