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This New Project Aims to Scale Rental and Recommerce Business Models

A circular economy doesn’t start and end with the supply chain. With the average consumer today buying 60 percent more items than they did 15 years ago—and wearing them for half as long—interest in building rental and recommerce business models is mounting among brands and retailers.

Circle Economy, the Amsterdam-based cooperative that promotes circularity, and Fashion for Good, a global platform that supports circular innovation, announced Thursday a new strategic project to accelerate the uptake of recommerce and rental business models in the apparel industry.

The project, called Switching Gear, will focus on ways recommerce, rental and leasing offer commercial opportunities for brands to innovate their business model, while maximizing clothing’s useful life and reducing the industry’s overall impact. The goal is to establish a line of communication to exchange insights and tangible solutions to move the apparel industry toward more circular business models.

Through this partnership, Circle Economy and Fashion for Good will work to establish a global “Enabling Network” of 50-plus leading circular solution providers and innovators, brands and relevant experts who are active players in the rental and recommerce space. The Enabling Network’s objectives are to build knowledge, connect brands with circular solution providers and to elevate the topic of these business models in the global apparel industry.

To start, the project that will guide brands on a circular innovation process toward the design and launch of rental and recommerce pilots by 2021. Founding members of the network include: Eileen Fisher, Gibbon, Mud Jeans, Reflaunt, RePack, Stuffstr, Style Lend, The Next Closet and The Renewal Workshop.

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Several of the founding members are early adopters of alternative business models. In the denim space, Mud Jeans launched in 2013 with a “Lease A Jeans” program that emphasizes usage over ownership, while underscoring the impact new denim has on the environment. Likewise, Eileen Fisher broke the mold in women’s ready-to-wear by collecting old products and reselling unwanted garments in perfect condition through its Renew program.

“We are very excited to build the Switching Gear Enabling network together with Fashion For Good,” said Gwen Cunningham, Circle Economy’s circle textile program lead. “We strongly believe that connecting a powerful and active community of brands, solutions providers and experts is key to advancing the practical implementation of circular business models in the market.”

Switching Gear is one of four global projects supported by the C&A Foundation to bridge the gap in the implementation of circular business strategies at all levels of the global apparel value chain. In 2017, the C&A Foundation pledged 1.29 million euros ($1.45 million) in funding to support circular fashion initiatives.

“C&A Foundation believes that the circular fashion transition will only happen when the industry implements circular business models. That is a huge challenge. We are pleased to be supporting these new partners,” said Douwe Jan Joustra, the head of circular transformation for the C&A Foundation.

The other initiatives include a London-based program that provides aid to four retailers in their journeys to develop circular business models, and a female-led workshop that connects circular business models to the mental well-being of young women. Market Makers, an initiative with World Resources Institute and WRAP, identifies policies, regulations and incentives that increase clothing reutilization in the U.S., U.K. and India. And Forum of the Future, an Asia-based platform, fosters circular partnerships between upstream and downstream companies in apparel. Each program will support Switching Gear.