We have solved the puzzle of the business case with industrial waste
Reverse Resources is an innovative platform that streamlines and digitises waste management within the textile industry. It connects various stakeholders, including waste suppliers, handlers, recyclers, and brands, fostering transparency, efficiency, and collaboration in handling textile waste. In an interview with Fibre2Fashion, CEO & Founder Ann Runnel discusses why a digital platform is critical to further promote textile waste recycling.
In the context of the fashion and textile industry, what are the most pressing challenges related to sustainability and resource management that need to be addressed?
One of the textile industry’s biggest challenges is the impact created by the choice of materials. Many brands today have set targets around increased recycled fibre content, prioritising this over organic cotton. But the global system for capturing textile waste and managing efficient supply chains of waste to recycling is yet to be built, making textile recycling quite expensive, and the recycling capacity is still low.
How do you see the concept of a circular economy transforming the fashion and textile industry? What are the key benefits and opportunities it presents?
The transition to the circular economy brings enormous new business opportunities for the industry. We have often been asked if the industry is doing this because of better marketing or greenwashing. The answer is ‘no’. In the context of climate change, several global crises and changing policies and regulations, the frontrunners in the industry have understood that textile waste is the key strategic resource. Recreating value and repeatedly earning revenues from the same fibre, fabric, or product is any industry’s new era of business. And textile and fashion sector is innovating at high speed to find scalable solutions to perform even better than the fast fashion business model has. In 5-10 years, we will see a fundamental shift in the industry from the old system to the new one.
Are there any emerging technologies or innovative practices within the industry that you believe have the potential to revolutionise sustainability and resource efficiency?
It is amazing to see how many different recycling technologies are about to enter the market or investing already in scaleup. Full circulation has been achieved for 100 per cent cotton, mostly at the pilot level. But technically, it is possible to recycle 85 per cent of any textiles today into high-quality fibres, yarns and fabric again and close the loop of textile waste. If we also include using textile waste to downcycled products in other industries (isolation panels, stuffing materials, black plastics), we could, in principle, reach 100 per cent use for textile waste. It is not so much of a technological challenge anymore, but a matter of sufficient (and balanced) capex investments, establishing feasible (data-driven) supply chains, digitisation to achieve efficiency of the fractured material flows (avoiding all unnecessary processes), and global collaboration to coordinate the best possible movement of these material flows.
What role do you think collaboration and partnerships play in driving sustainable practices within the fashion and textile sector?
Collaboration and partnerships can help in “balancing the grid”. What I mean is that we need to plan carefully which recycling technologies we use in the context of global material flows so that we do not create hyper-competition for certain fibres in one place and end up suffocating the potential of recycling while other waste flows or regions that may have recycling potential stay out of focus. Top-level planning that starts from access to global data of textile flows (by composition and material type) is essential for a success story of circular textiles. But to get such access to data, we also need to take ground-up action of mapping and digitising textile flows, helping companies see the benefit of the data exchange between themselves and building trust in collaboration.
From your perspective, what are some of the most promising trends or developments in sustainable fashion that you think will shape the industry’s future?
I think it is the combination of the different innovations and solutions that are popping up. One by one, they often focus on one vertical part of the bigger supply chain of the system and do not seem to create a big difference yet. But all together, there is a clear indication of a systemic change in the background. The most promising trend is moving towards a point where textile fibre maintains a positive value throughout the global circulation, and the business case of endlessly circulating textiles becomes feasible. This is where we start seeing the alternatives to fast fashion business models to scale up properly and the world to move towards wardrobe-as-a-service or fibre-as-a-service approaches. Another really interesting trend is related to the question of the ownership of the product or the fibre because the global coordination of textiles across the movement of the materials from one legal body to another brings along the questions of the governance of the data as well as the rights to access the materials. The circular economy is about to start creating all kinds of new topics and discussions in the industry we never thought about before. But first, we need to solve the basics of the business case and the process feasibility issues.
What inspired you to establish Reverse Resources? Could you share any specific challenges or opportunities that led to its inception?
For me, the story started from the frustration that, as a consumer, there isn’t much I can change by making one or another choice if these choices aren’t first made readily available and convenient. I was spending too much time trying to find better alternatives. Studying economics, I decided to do my master’s thesis on why some companies put sustainability into their core business focus and how they benefit. How can we thereby incentivise other companies to do the same? My research brought me to Bangladesh for the first time, and the initial idea I had was to create a marketplace for deadstock fabrics for upcycling fashion designers. But a few years and many learnings later, we pivoted and focused on the recycling story for two reasons. First, we discovered that deadstock fabric isn’t such a problematic waste stream, and although there is a lack of transparency and efficiency, there is already a functional market for such materials. And second, we saw that it is not so much value that we can give as a 3-rd party platform (the market barriers were too high). But we found an angle with recyclable waste where companies cannot fully solve the problem between themselves one-on-one, and a digital platform is critical to support the market scaleup.
Can you provide an overview of Reverse Resources and its mission? How does the company contribute to sustainability and resource efficiency?
Reverse Resources’ mission is to shift the textile industry towards using textile waste as a sustainable source of fibre by growing and supporting the market with a feasible business case. We do this by digitally mapping textile waste flows, building data-driven textile waste supply chains, and enabling real-time collaboration among all industry stakeholders. In practice, it means that today garment factories can use our software to register in real time how much of which waste is generated from their cutting table while segregating waste by composition and colour for recyclers. Brands can see how much of their waste is available for recycling and nominate recyclers they want to work with. Recyclers can source the waste through well-planned route with least cost and highest quality and collaborate with waste handlers to help them pick up, aggregate and check the waste quality before shipments. We have reconstructed the supply chain processes and data management in such a way that there is a win-win benefit for all sides, and the data generated from the platform can be used by industry associations and public sector to discover market barriers and support the scale-up of textile circulation. Today we trace around 800 tonnes/month of textile waste movement to textile-to-textile recyclers in real time in six countries – Bangladesh, India, Turkey, China, Indonesia and Egypt. By helping to replace virgin materials with recycled ones in fashion, last year we helped to save as much CO2 emissions as is the annual footprint of 10,000 people.
Could you elaborate on the technological solutions or methodologies employed by Reverse Resources to track, trace, and optimise textile waste throughout the supply chain?
I would say, technologically the solution is rather simple. The value of waste is low and on every step of the way we were needed to make sure that we are not making the solution too costly or overengineered. The key innovation in our case is not the technology, but the way we engage the network of participants and build trust and will to collaborate. Similar to Airbnb, Uber or other SaaS solutions that connect people, who do not know each other, and help them reach a joint goal, we rely on creating loops of data exchange and feedback between the stakeholders, a chain of custody verification of the data. And we optimise the supply chains by making sure that each batch of waste, before getting any hands on it or even before getting generated, already has a known destination and a pre-determined list of processes, the most efficient route from source to the best possible recycling scenario. While companies usually optimise their processes and cost internally within their own organisation, our platform helps to do the same across the supply chain between multiple parties.
What are some successful projects or partnerships that Reverse Resources has been involved in? How have these initiatives contributed to your mission?
Reverse Resources has been and is involved in several great collaboration projects. First, we launched Circular Fashion Partnership with Global Fashion Agenda in Bangladesh in 2021. We had 20 large global brands inviting the factories to segregate their cutting scraps by composition and make this digitally visible and accessible for textile-to-textile recyclers. We simultaneously managed to optimise the supply chains, reduce costs and increase the quality of waste significantly. At the same time, we are supporting local waste handlers to shift from brokering (and lack of transparency) to service providers, formally participating in the global supply chains. This win-win solution has now started to scale up and significantly increase the recycling capacity in the country. It is a good example where the demonstration of a business case for local parties builds trust in centralised data sharing, again allowing to build market insight and statistics for better planning for developing the recycling grid.
Today we are working on a similar project with Fashion For Good and IDH in India, and with UNIDO in North Africa and Bangladesh. We are also preparing projects in Cambodia, Vietnam, Indonesia, Morocco and Pakistan, working closely with GIZ, H&M Foundation, UNIDO, Closed Loop Fashion, Accelerating Circularity and other organisations. We have created a blueprint for building an efficient circular textile system on a country level. However, it is also clear that as much we have needed to work with these collaboration projects to bring our solution to the market, our solution and the business case for the market along with it are needed to trigger and scale textile circulation. It is a great synergy between the public and private sectors working together for the same goal.
Transparency and collaboration are crucial in achieving sustainability goals. How do you facilitate communication and cooperation among different stakeholders within the fashion and textile industry?
The industry often talks about transparency as something that needs to happen once the products are made and on the way to a consumer. It is talked about in the context of better reporting. In our case, transparency is a by-product of efficient planning ahead of time. Instead of asking someone to enter data simply on someone else’s request (e.g., a report from a factory to a brand or a consumer) or for marketing value only, we always look for an angle where the one sharing some data is compensated by some direct business returns (cost savings or increased margins). We demonstrate that participating in the circular system is not just nice to have, but it is bringing new business opportunities.
Could you discuss the impact of your organisation on the economic aspects of the fashion industry? How does it benefit brands, manufacturers, and other players in the supply chain?
By rewiring the textile waste management business case, processes and supply chains, we have achieved an average 25 per cent reduction of the price of the waste for recyclers while reducing the average contamination of the waste from 2 per cent to 0.03 per cent. With large industrial volumes this can mean millions of dollars of savings for a recycler each year (depending on the size of the recycling plant) and increases volumes of recycled materials offered to the market at competitive prices compared to the virgin materials.
What are some future goals or aspirations for Reverse Resources? Are there any new projects or developments on the horizon that you can share with us?
We have solved the puzzle of the business case with industrial waste, and we are scaling up the solution with 14 large fashion corporates using our platform regularly and expanding geographically very fast. It is rather overwhelming how much positive feedback and excitement we see around this approach. But the even bigger challenge is also to improve post-consumer waste management. We have many learnings and proven methods of success from industrial waste that can be applied to post-consumer waste flow just the same.
Lastly, how can individuals, brands, or organisations get involved or support Reverse Resources’ mission? Are there any specific ways for people to collaborate or contribute to your initiatives?
We welcome all garment factories to join the platform, make their textile waste visible to brands and recyclers digitally in real-time and track which recycler it reaches. That’s the best method of supporting the business case of textile circulation. On the other side, we welcome brands to get interested in how much of which waste is generated from their garment factories and which recyclers this would be best to link up with to maximise the life cycle of these valuable resources. Brand involvement and interest in their waste streams (along with understanding which textile products could be made of it) are essential for creating the upfront transparency that allows recyclers better access to the waste they need.
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