Circular Economy Circular Economy Innovation & Technology

How Can Apparel Brands Solve a Problem Like Deadstock?

A growing number of niche brands are finding success with apparel repurposing; but many larger apparel companies have no best practices in place for managing their enormous volumes of unsellable merchandise. Fortunately, a new sub-industry of upcycling partners is stepping in to ‘reimagine’ increasingly large volumes of deadstock.

Brand Provided | By Mark Litos | Published 2 years ago | About a 5 minute read

Image: Zero Waste Daniel

Despite real progress in recent years toward improving sustainable business practices, there is still one area the apparel industry hasn’t quite figured out yet — and it’s a big one.

As the detrimental impacts of fast fashion continue to be documented and quantified, manufacturers, retailers and fashion brands are responding by improving practices in areas such as sourcing and replenishing of raw materials, water usage, environmental pollution and human rights.

These advancements are often featured prominently in brand messaging campaigns and annual corporate social responsibility (CSR) reports as consumers, investors and regulators demand more accountability from companies to reduce environmental impacts and improve social responsibility in the manufacturing process. While some progress is being made and should be applauded if the efforts are truly sustainable and not “greenwashing,” these sustainability efforts have predominantly been focused on the front-end of the clothing manufacturing process and along the supply chain.

Unfortunately, much less attention is being paid to the complete lifecycle of these goods.

The apparel industry produces millions of tons of deadstock each year. Yet, the industry has no best practices in place to responsibly handle all of this surplus inventory. Deadstock is often fueled by over-purchasing, manufacturing specification errors, misprinting and decorating flaws. At the retail level, dead inventory piles up due to customer returns, damaged/soiled goods, broken size runs/one-offs, dated goods, failed designs, and even social-justice initiatives. Deadstock is a universal industry challenge without a current widescale solution.

Unlike in other industries, the resources and effort it takes to recycle clothing can be much greater compared to other consumer goods. To separate, treat and process clothing waste into new material and then reuse it to make new clothes can generate many of the same harmful effects found in the initial production process. In addition, recycling often results in lower quality and less valuable material. As a result, much of the sustainably produced merchandise that doesn’t sell still ends up in landfills or incinerators, which pollutes the environment. Estimates show that less than 15 percent of clothing in the US is currently recycled.

This points to the need for the industry to adopt upcycling as an additional approach to existing sustainable practices.

Deadstock got its name from the fact that the industry traditionally perceived the lifecycle of a piece of clothing as linear, with the end stage seeing the item discarded or destroyed as waste. Large-scale upcycling has the potential to create a more direct, less harmful and circular approach to creating new merchandise from unsold, surplus inventory and returning it to the marketplace. The more companies adopt upcycling as a greater part of their sustainability efforts, the less need there will be to engage in the harmful practices inherent in the up-front manufacturing process and along the supply chain.

Unlike recycling or reclaiming methods, upcycling uses virtually no energy and zero water, has very low environmental impact, and doesn’t diminish the quality or value of the merchandise. In fact, by using creative approaches to transform deadstock into new products, fashion brands can design unique merchandise from existing materials that have greater appeal to today’s eco-minded consumers and higher value than the original garments from which they were made.

A growing number of boutique or niche fashion brands — such as Beyond Retro, Re/Done, and Zero Waste Daniel — are finding success with a variety of approaches to apparel repurposing. However, many of the large manufacturers, retailers and fashion brands with robust sustainability programs in the up-front production process have little to no best practices in place for managing their enormous volumes of new, unsellable merchandise.

The good news is, larger companies are not only beginning to dip their toes into the upcycling stream; some are jumping right in. Since upcycling adds a new manufacturing step after what was traditionally the end of the apparel lifecycle, most companies are not equipped to upcycle merchandise in-house. As a result, a new sub-industry of upcycling partners is emerging that are equipped to receive and “reimagine” increasingly large volumes of deadstock. Some brands leading the way are those we expect to see, while others might surprise us.

Through its Urban Renewal initiative, Urban Outfitters continues to develop its upcycling capacity. Through a partnership with Brooklyn, NY-based FABSCRAP, the company is diverting would-be waste textile materials, while simultaneously creating an accessible materials resource for creative communities. However, most of their efforts currently appear to be focused on fabric waste from the production process rather than deadstock.

Patagonia partnered with LA-based Suay Sew Shop to assist with its new ReCrafted collection of clothes made from damaged goods that have been turned into entirely new, one-of-a-kind products. The company has also been taking back worn-out or no-longer-worn Patagonia apparel from customers for refurbishment and resale through its Worn Wear marketplace.

Other prominent brands such as Champion and Pottery Barn have partnered with Oregon-based The Renewal Workshop to clean and repair unsold, damaged merchandise. The renewed products are then certified, co-branded and returned to the marketplace.

In the dynamic sports industry, when the Washington Commanders decided a name change was needed to advance social justice, thousands of pieces of branded merchandise became deadstock overnight. The Girl Scouts of America faced a similar deadstock challenge when the organization decided to launch more sustainable uniforms and needed a responsible solution for the existing inventory on hand. Both organizations turned to New Bedford, MA-based Refried Apparel to help them transform their unsold, obsolete merchandise into new fashion apparel and accessories.

Adopting and investing in new business models is no easy task. It takes time, education and commitment. These are just a few examples that show how upcycling can become an industry standard and a scalable best practice in the apparel industry. Creative reimagining of deadstock at industry scale can cycle large volumes of surplus merchandise back into the marketplace, while eliminating the most environmentally damaging manufacturing stages and avoiding offshore labor and supply chain issues. This represents significant opportunities and benefits for the industry, workforce, consumers and the environment.