The Nordic Textile Collaboration

3.3 The journey of participating companies

Active Textile Society aimed at bringing together companies and citizens across the Nordic countries to break down barriers for circularity. The initiative attracted different types of companies willing to engage with and develop circular business models as part of the six-month challenge. In total, nineteen companies active in the Nordic textile and fashion industry joined the initiative:

Nine companies from Denmark, four companies from Finland, four companies from Norway and two companies from Sweden.
Eighteen of them were micro- and small companies with less than 50 employees. One was large, with more than 250 employees.
Eleven of the companies described themselves as being active in production of textiles, including clothing for women (five companies) and men (one company), workwear (four companies), as well as bags and accessories (one company).
When describing their existing business model, most of the companies indicated that they already provided services related to extending the lifespan of their products through circular business models, such as repairs, redesigns, resales and rentals. Few of the companies stressed that they used circular design principles to enhance recycling, and some mentioned that they have take-back solutions as well as resale infrastructures in place already.

Before starting the six-month challenge, companies were asked to provide information about circular business models of interest as well as resources needed to carry out the transition and barriers foreseen. Nine companies answered the survey. The survey showed that participating companies had a great interest in exploring the circular business models of repairs and redesign, but also a few wanted to seek out opportunities for resale, rentals and other new options, such as production on demand, recycling and take-back solutions.

The respondents could choose more than one option based on a predefined list of the circular business models known as “resale”, “rental”, “repair”, “remake” and “others.

The following table summarizes responses to the survey question:

What types of resources do you have that support the completion of the challenge?

	Respondents
A	Human resources (e.g. employee time to complete the challenge	6
B	Marketing resources (e.g. employee time to create awareness of your service)	3
C	Design resources (e.g. employees who can handle the new service)	2
D	Marketing resources (e.g. employee time to create attention and awareness of your service)	3
E	Design resources (e.g. skilled employees in-house who can handle the new service)	4
F	Logistics (e.g. capacity, shipment and shop space for offering the service)	3
G	Other (please elaborate):	4

It is relevant to note that

Only around two-thirds of the respondents have human resources available in house;
Only half of the companies have design resources;
One third has financial resources, as with marketing resources and logistics; and
Around one quarter of the digital resources available in house.

These answers indicate that most of the companies lacked crucial resources for making the required changes and achieving a circular business model. One of the participating companies stressed the issue in this way: “We don't have the needed in-house competences and vision to create awareness of new services.”

Quote from the survey “Getting ready for the six-month challenge” conducted in November 2023.

The following table summarizes findings regarding barriers foreseen by participating companies:

Which barriers do you foresee when it comes to completing the challenge?

	Respondents
A	Time and internal resources, including competences and skills	5
B	Budget for developing and implementing a circular business model	6
C	Revision of purpose and vision of the company	1
D	In-house capacity (storage, shipment, shop space etc.) for facilitating the service	3
E	Reorganization of sales platforms	4
F	Getting sufficient data from suppliers for documentation purpose or calculation of baseline	2
G	Customer incentives, i.e. making the circular business model attractive to customers	7
H	Profitability i.e. making a profit of the circular business model	4
I	Regulations, e.g. complying with rules, requirements and standards	1
J	Other (please specify):	2

The survey’s responses indicate that companies foresee difficulties with providing customer incentives as well as raising the necessary budget, time and competences for developing and implementing circular business models. The category “Other” includes the challenge of educating customers to depart from conventional buying and selling of textiles, thus underscoring that lack of customer incentives is a key barrier for the promotion of circular business models, according to the participating companies.

To overcome these barriers, companies reported in the survey that they saw a need for citizen feedback on services, peer-to-peer advice and assistance from experienced circular business companies, as well as more information about the implications of new EU legislation.

To sum up, the initiative attracted companies from across the textile value chain and across the Nordic countries, all of them eager to learn more about the extension of textile lifespans through circular business models and to engage in a dialogue with both citizens and peers about these issues.

The following sections describe the journey of four companies that shared experiences with their circular transition during the six-month challenge by filling out bimonthly logs about how they fared.

The four companies submitted logs in February, April and June 2024 focusing on which barriers and solutions they experienced as part of their circular transition. Several other companies shared their experiences during the online workshops hosted as part of the Active Textile Society webinar program (see section 3.2) but did not fill out the logs while a number of the companies had to opt-out during the project period due to limited time and resources.

Company 1: Developing and testing a platform for transparent product management to boost resales

Activity: To pave the way for offering resales, the company developed a digital product passport (DDP), working as a platform for transparent product management. During the six-month challenge, the company tested the DDP with pilot clients and worked with a new partner to achieve a user-friendly platform.

Barriers: Several of the pilot clients found onboarding challenging because they did not have any data structure in place that could provide product data or history for secondhand garments, nor the skills for collecting and managing such data.

Solution: The company prepared simple guides for how to use the platform and acted as a bridge-builder between the different stakeholders. The company summarized the effort in this way “We believe that the key to a circular market is cooperation. We started to introduce different groups to each other and encourage them to share their solutions and build one stronger solution together.”

Source: Active Textile Society, Company logs from February and April 2024.

Company 2: Introducing a digital measuring system for production on demand and resales

Activity: To improve its models for production on demand and resales, the company worked on introducing a digital measuring system.

Barriers: Lack of time and money stood in the way of implementing and scaling up the solution.

Solution: The company decided to do “baby steps” rather than developing a full-scale system.

Source: Active Textile Society, Company logs from April 2024.

Company 3: Improving service and product circularity

Activity: The company wanted to improve their existing model for producing and selling workwear, with a focus on servicing, testing, repairs, and product circularity. The company described the efforts in this way: “Since product servicing is already integral to our business, we are now concentrating on how to bridge the gap in our circular business model regarding end-of-life recycling of products and materials. We will place greater emphasis on the design phase to ensure our products remain compatible with servicing and repairs.”

Barriers: Due to the high standards required for workwear, the product costs are intensive. At the same time, it proved very difficult to meet expectations from customers in terms of speedy delivery times, as circular services, such as demanding repairs, take time to carry out.

Solution: The company focused on product development, engaged in strong partnerships with existing suppliers and invested resources in communicating better to customers the operational time of their service actions. The company provided the following advice for other companies implementing circular business models:

Rethink consumption and production: The first key driver for a circular business model is to challenge traditional consumption patterns and mass production. Shift the focus from creating overcapacity and surplus stock to producing high-quality, sustainable items that meet real needs.
Promote mindful consumption and encourage customers to buy less but better. This fundamental change supports a more sustainable future and reduces overall environmental impact.
Update economic models: The world economy needs an update and a re-think from competitive business models to a more collaborative approach. We should work together, share knowledge, and refrain from using it solely as an advantage to sell more products.
Holistic view: Address the entire product lifecycle, from design to disposal.
Design for durability: Develop products that are long-lasting, repairable, and upgradable.
Closed-loop systems: Establish return programs for recycling, refurbishing, or remanufacturing.
Supply chain partnership: Collaborate with suppliers dedicated to sustainable practices.
Digitalization: Implement digital tools to monitor materials and optimize product lifecycles.
Educate employees: Train staff on circular economy principles and new procedures.
Innovate and collaborate: Engage with other organizations to exchange knowledge and resources.
Transparent communication: Clearly communicate your circular initiatives to stakeholders.
Track progress: Set up metrics to monitor and enhance circular practices.
Regulatory compliance and advocacy: Stay updated on regulations and promote policies that support circular practices

Source: Active Textile Society, Company logs from February and June 2024.

Company 4: Improving upcycling as a business model

Activity: The company worked with upcycling as a business model and wanted to improve the existing operation through research on new methods and materials.

Barriers: It was difficult to develop the business strategy, including identifying the purpose and the vision of the company as well as difficult to find the right input material.

Solution: Defining purpose as “small-scale upcycling” and investing time in searching for suppliers.

Source: Active Textile Society, Company log from June 2024.

To sum up, the companies did try out different circular business models, including resales, repairs and redesigns. Key take-aways from their journey include the persistent need for building strong partnerships with stakeholders to get help with digitalizing the circular business model, but also to get access to know-how, equipment and materials. Several of the participating companies reported that the webinars and workshops during the initiative had been very helpful; however, they pointed to the need for more continuous peer-to-peer advice and assistance to be able to implement and scale up their circular business models.