February 24, 2024
Circular Fashion Market

The Global Circular Fashion Market Is Driven By Sustainable Fashion

The global circular fashion market focuses on recycling post-consumer clothing and textile waste to reduce environmental pollution. Circular fashion incorporates sustainable practices like recycling, upcycling, reuse, redesign and resale of garments to prolong their usage. As the linear “take-make-dispose” model of fast fashion promotes overconsumption and waste generation, circular fashion aims to keep clothing in use for longer through various recycling techniques. It emphasizes on designing clothing from recycled or biodegradable materials to minimize raw material usage and reduce the carbon footprint of the apparel industry.

The global Circular Fashion Market is estimated to be valued at US$ 6.09 Bn in 2024 and is expected to exhibit a CAGR of 3.5% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights. With rising awareness about ecological preservation, consumers are inclined towards brands that offer sustainably created apparel and accessories. The aspiration to create zero waste through circular systems is driving key players to adopt recycling technologies and collaborate with fabric suppliers on alternative fabrics. The market is witnessing a preference shift towards rental, resale and durable clothing that can tolerate multiple wash/wear cycles compared to flimsy fast fashion garments.

Market key trends:

One of the major trends driving the Global circular fashion market growth is the adoption of direct-to-consumer rental and resale businesses. Startups in this space allow customers to rent or resell their pre-owned clothing through online platforms, diverting tons of textile waste from landfills. Companies like D€TMA, thredUP, Rent the Runway, Nuuly etc. facilitate easy access to a rotating closet through subscription models. Another prominent trend is the surge in sustainable materials that make up circular clothing ranges. Fabrics derived from plant-based, ocean plastics or recycled polyesters are gaining popularity due to their eco-friendly composition. Brands are also partnering with fabric mills to bring transparency in material sourcing and monitor supply chain emissions for attaining net-zero goals.

Porter’s Analysis

Threat of new entrants: The threat of new entrants in the global circular fashion market is low as it requires high initial capital for infrastructure set up and brands have loyal customer base.

Bargaining power of buyers: The bargaining power of buyers is high in the global circular fashion market as numerous options are available for buyers to purchase.

Bargaining power of suppliers: The bargaining power of suppliers is moderate in the global circular fashion market as manufacturers prefer to source materials locally to adhere to sustainability norms.

Threat of new substitutes: The threat of new substitutes is moderate in the global circular fashion market as sustainability has now become a key trend in the fashion industry.

Competitive rivalry: The competitive rivalry is high among existing players to gain market share in the global circular fashion market through product innovation and expansion into new regions.

Key Takeaways

The global circular fashion market is expected to witness high growth.

Regional analysis: The circular fashion market in Europe is expected to dominate the global market during the forecast period. Countries like France, Italy and UK are increasingly adopting circular fashion practices due to growing environmental concerns. The Asia Pacific circular fashion market is projected to witness fastest growth during the forecast period. This is attributed to rising consumer awareness regarding sustainable fashion in countries like China and India.

Key players operating in the circular fashion market are D€TMA, THE REALREAL, THREDUP, REBELLE, ROTTIELOVE, NAUGHTY MONKEY, PACT, HOUN. D€TM A focuses on accessible luxury segment through rental and resale program for handbags and apparels.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it