Circular Revenue Model
Circular revenue models focus on generating income while promoting sustainability by recycling, upcycling, and reusing materials. These models offer fashion companies the opportunity to create value not only through direct sales but also by adopting innovative approaches such as subscription services, rental models, and digital platforms. By aligning their revenue strategies with sustainable practices, companies can reduce waste and improve their environmental footprint while maintaining profitability.
This unit explores the key components of circular revenue models and how they can be implemented in the fashion system to drive both sustainability and profitability.
Case Studies
For Days
For Days is a zero-waste fashion brand that has implemented a subscription-based model, allowing customers to exchange old garments for new ones. The old garments are then recycled into new items, closing the loop on textile waste and promoting a sustainable revenue stream based on recycling and customer loyalty.
Learn more about For Days
The R Collective
The R Collective is a sustainable fashion brand that creates collections from surplus fabrics, promoting recycling and upcycling. The brand collaborates with designers to create limited-edition pieces using waste materials, creating a unique revenue model based on transforming waste into fashion, thus contributing to both sustainability and profitability.
Learn more about The R Collective
Eileen Fisher Renew
Eileen Fisher Renew is a take-back program that allows customers to return worn Eileen Fisher garments, which are then cleaned, mended, and resold. This circular model generates revenue from both new and previously owned products, while promoting the reuse of garments and reducing waste.
Learn more about Eileen Fisher Renew
The Upcycle Project
The Upcycle Project is a brand that focuses on transforming waste materials into new, high-fashion pieces. By using discarded clothing and textiles, the brand reduces waste and creates a unique product offering that supports a circular revenue model. This approach helps the brand differentiate itself while promoting sustainable fashion practices.
Learn more about The Upcycle Project
References
- Amed, Imran, and Achim Berg. (2021). The State of Fashion 2021 Report: Finding Promise in Perilous Times. The Business of Fashion.
- Ostermann, C. M., Nascimento, L. S., & Zen, A. C. (2021). Business Model Innovation for Circular Economy in Fashion Industry: A Start-ups’ Perspective. Frontiers in Sustainability, 2(766614).
- Todeschini, B. V., et al. (2017). Innovative and Sustainable Business Models in the Fashion Industry: Entrepreneurial Drivers, Opportunities, and Challenges. Business Horizons, 60(6), 759-770.
- Fan, X. (2014). The Profit Model of the Fashion Industry. International Journal of Business and Social Science, 5(1), 113-117.
- Lee, Chung‐Shing. (2001). An Analytical Framework for Evaluating E‐Commerce Business Models and Strategies. Internet Research.