How can brands deal with excess inventory without devaluing their brand? 

August 23, 2021

As you might have heard, many people and brands have been talking about upcycling, reusing, recycling etc. these past few months. Why is now? There are multiple reasons to explain this, but the root reason is the universal awakening about sustainability. This has caused a huge consumer mind shift. People are past the awareness stage and are now taking action to decrease their environmental footprint, including their fashion. This has obviously had a ripple effect on business, causing brands to reconsider their business model and their linear production as they want to match consumer’s demand.

The fast-paced linear production system has caused brands to accumulate clothes for years. High-quality brands have years of excess inventory stocked in warehouses as they're aren't adapted solutions to liquidate this tock. The only solution they had for years was the use of flash sales, which damages their brand image and has very low margins. 

So how can brands deal with excess inventory ? As the Kering sustainability standards: Reduce, Reusing, Repair, Remake, Recycle. 

Reducing is quite obvious all brands should be doing.

Reusing: Brands don't have much control over this, as its a post-consumer behaviour. Although it is a behaviour that brands can and should definitely encourage by putting collection points etc..

Repair, Remake, Recycle: Let's zoom in into these potential solutions

Upcycling VS recycling: what’s the difference?

Simply put, recycling is the process where you transform a garment into raw material to create a new one from almost zero. It’s important to know that recycling is quite a complex and technical process that requires longer to achieve. You have to deconstruct and reconstruct the product from scratch. The result of recycling is a devaluation of the original piece because you transform a finished product into raw material. Plus, it takes more resources to recycle so it should be the last option for unwanted clothes.

However, upcycling, as its name states, increases the value of the piece. It is the process of transforming the clothing item into another one, with more value because there is more work that is put into it. Yet, it’s not a process as long and complex as recycling, which makes it less energy-demanding and more interesting for a business. 

In conclusion, upcycling/remaking is what high-quality brands should do with their excess inventory to avoid their brand dilution. Brands that trust on the quality of their products should start creating new products out of what already exists. It send a strong message to consumers that their products last the test of time and that their brand is mindful of what products they produce. 

Upcycling is becoming so demanded that several luxury brands have launched their own capsule upcycling collections to test the waters. The latest ones are Balenciaga, Miu Miu, Diesel, and many others are joining the movement.

Brands often lack the resources to do upcycling projects, which is why they can count on ISLA to manage revaluing their products. Contact us here to learn more!