Clothing the Loop: Exploring Start-ups and their Circular Business Model Innovations in the Fashion Industry

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The existing dominant unsustainable fashion system with a take-make-disposal principle calls for an urgent need for transformation. The desired fashion future is a new global textiles system aligned with the principles of a circular economy. A circular fashion economy is restorative and regenerative by design, provides benefits for business, society, and the environment, and reflects the true cost of materials and production processes in the price of products. In such a system clothes, textiles, and fibers are kept at their highest value during use, and after use, are circled back into the economy. The key to progress is innovation, and there is a clear need for innovative business models within fashion in the pursuit of sustainability. Within the fashion industry, innovation and experimentation are manifold. At present, many of these interventions exist as small initiatives by start-ups outside of the linear paradigm. Although the relevance of start-ups for sustainable innovation and transitions is widely acknowledged, it is still open for discussion how start-ups grow and contribute to transitions. Therefore, this research investigates emerging issues, barriers, drivers, and opportunities that prevent and facilitate start-ups’ upscale beyond their current niches and to reach the mainstream fashion market.
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