Where does excess come from?
According to the Council for Textile Recycling, the average US citizen throws away 70 lbs. of clothing and other textiles annually. The U.S. EPA estimates that textile waste takes up nearly 5% of all landfill space. We refer this this waste as post-consumer excess. Although this is and should be a growing concern for all of us, it shrinks in comparison to the amount of new, pre-consumer materials disposed of every year. (also referred to as "deadstock")
Industry wide, the exact amount of textile waste being thrown away before it even has the chance to become goods isn't actually known, but we do know this number is massive. But where is all this "excess" coming from?
Case study #1: Business as usual
The players: the Brand, the Factory and the Fabric Mill.
In this example, the Brand approaches their partner Factory and says, "we want to make this jacket from this material, from this Mill".
The Factory then goes to the Mill and says "We need to purchase this fabric to make this jacket to full this order."
The Mill produces the fabrics needed to complete the order. Depending on the mill, they will make an additional 3% - 5% of the material to compensate for errors.
The Factory constructs the finished product which is then shipped to the brand's warehouses. If the factory ordered 100,000 yards of materials to complete the order, that leaves 3,000-5,000 yards of extra materials just to make sure there is enough.
Case Study #2: Cancelations
Once again, the players are: the Brand, the Factory and the Mill.
The Brand goes the the Factory and says, ‘We want to make this jacket from this fabric from this Mill.’
The Factory goes to the Mill and places an order saying 'we need you to make this much of this material’.
The Mill makes the fabrics to order and deliver the new materials to the Factory. As usual, they over produce the order by an average of 3% - 5% to cover their bases.
In the meantime, the Brand contacts the Factory and says, “Retailer A canceled their order. Now we don’t need 10,000 jackets, we only want 5,000.” — Or they’ve done tests on the materials and decide the color is off. (perhaps it doesn’t match the Pantone colors or doesn’t merchandise right with the rest of the line)
Regardless of the reason, the Factory is paid by the Brand, and they fulfill the updated order. (The Brand has paid for the materials they've committed to)
The Factory now is sitting on a significant amount of extra material. The Factory has already paid the Mill for the materials, which have been delivered. The materials have already been covered by the cost of the item, as the cost of goods. The Factory has already been paid by the Brand for the materials, which they are now sitting on. However, the materials, which are technically owned by the Brand are now sitting in a Factory, so the Factory charges the brand for storage of the materials.
This is called “Fabric Liability.” At this point the Brand has paid for the fabrics twice; the Fabric has been paid for the purchase order, and they’ve been paid for the materials a second time in the context of storing it.
These materials are we refer to as “excess” or “textile waste”. The Factory has already been paid, and they’re now sitting on thousands of yards of materials, which they don’t want and have to get rid of to avoid storing it indefinitely.
Option one: they incinerate the materials.
Option two: they throw it away and it ends up in a landfill.
Option three: they sell it for pennies on the kilo to fabric brokers and send it off to a third world destination where it crushes local industry.
Occasionally there is a fourth option, where it's unscrupulously put it back into production to make knockoffs or falsified goods. Because of this, brands will often make the factory dispose of the materials and prove it to prevent falsified goods.