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  • Published In : Jan 2024
  • Code : CMI6470
  • Pages :140
  • Formats :
      Excel and PDF
  • Industry : Consumer Goods

The Circular fashion Market size was valued at US$ 6.09 Billion in 2023 and is expected to reach US$ 11 Billion by 2030, growing at a compound annual growth rate (CAGR) of 8.8% from 2023 to 2030. Circular fashion refers to clothes, shoes, accessories, and textiles that are designed, sourced, produced, and provided in a sustainable way, minimizing waste and pollution. It involves recycling old clothes into new ones, renting outfits, and trading secondhand. Key drivers of the market include rising environmental concerns, advancements in textile recycling and strict government policies promoting sustainability.

The global circular fashion market is segmented by product type, end-use, distribution channel, textile source, and consumer group, Region.  By product type, the market is segmented into apparel, accessories, footwear, and others. The apparel segment accounted for the largest share in 2022 due to high demand for recycled and upcycled clothing.

Global Circular Fashion Market Regional Insights

  • North America is expected to be the largest market for the global circular fashion market during the forecast period, accounting for over 35% of the market share in 2023. The growth of the market in North America is attributed to rising awareness about sustainability and the presence of major fashion brands.
  • The Europe market is expected to be the second-largest market for the global circular fashion market, accounting for over 25% of the market share in 2023. The growth of the market in Europe is attributed to stringent government regulations around circularity.
  • The Asia Pacific market is expected to be the fastest-growing market for the global circular fashion market, with a CAGR of over 9% during the forecast period. The growth of the market in Asia Pacific is attributed to increasing consumer awareness and rapid economic growth in the region.

Figure 1. Global Circular Fashion Market Share (%), by Region, 2023


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Global Circular Fashion Market Drivers

  • Increasing awareness of sustainability issues among consumers is driving the growth of the global circular fashion market. More consumers, especially millennials and Gen Z, are concerned about the environmental impact of fast fashion and looking for sustainable alternatives. This has led many major fashion brands to adopt circular models, use recycled materials, and promote clothing rental and resale. Consumer demand for eco-conscious apparel and footwear is propelling market growth.
  • Stringent government regulations regarding textile waste and sustainability are catalyzing the shift towards circular fashion. Many countries have passed legislation to reduce textile waste going to landfills. For instance, France banned incineration and landfilling of unsold clothes. The EU strategy for sustainable textiles aims to boost clothing utilization rates through recycling and reuse. Such regulations are compelling fashion companies to incorporate principles of circularity. For instance, clothing rental platform HURR collects and rents over 250,000 pieces of designer clothing, diverting them from landfills, according to 2021 impact report.
  • Advancements in textile recycling technologies are driving greater adoption of recycled fibers and materials in apparel and footwear. With innovations in chemical textile recycling, more clothing and other items can be broken down at the polymeric level to produce recycled fibers. Enzymatic processes can separate cotton and polyester blends for recycling. Such technological developments allow high-quality recycled textiles to be created from waste.
  • Celebrity endorsers and influencers promoting sustainable fashion labels and eco-conscious clothing are raising awareness. Circular brand partnerships with high-profile names like Emma Watson, Jane Fonda, and Rosario Dawson leverage their star power and expand reach to millennial and Gen Z audiences. Influencers on social media also help shift perceptions around pre-owned and upcycled fashion. Their advocacy provides an impetus for circular fashion.

Global Circular Fashion Market Report Coverage

Report Coverage Details
Base Year: 2022 Market Size in 2023: US$  6.09 Bn
Historical Data for: 2018 to 2021 Forecast Period: 2023 - 2030
Forecast Period 2023 to 2030 CAGR: 8.8% 2030 Value Projection: US$ 11 Bn
Geographies covered:
  • North America: U.S. and Canada
  • Latin America: Brazil, Argentina, Mexico, and Rest of Latin America
  • Europe: Germany, U.K., Spain, France, Italy, Russia, and Rest of Europe
  • Asia Pacific: China, India, Japan, Australia, South Korea, ASEAN, and Rest of Asia Pacific
  • Middle East & Africa: GCC Countries, Israel,  South Africa, North Africa, and Central Africa and Rest of Middle East
Segments covered:
  • By Product Type: Apparel, Accessories, Footwear, Others
  • By End-use: Men, Women, Kids, Unisex, Others
  • By Distribution Channel: Online, Offline, Others
  • By Textile Source: Organic, Recycled, Reused, Natural Materials, Others
  • By Consumer Group: Millennials, Generation X, Generation Z, Baby Boomers, Others
Companies covered:

H&M, Inditex (Zara), EILEEN FISHER, Patagonia, Levi Strauss & Co., The North Face, Nike, Adidas, Pact, Everlane, Reformation, Rent the Runway, ThredUp, The RealReal, Vestiaire Collective, Depop, Poshmark, Etsy, eBay, Tradesy

Growth Drivers:
  • Sustainability awareness
  • Government policies
  • Recycling advancements
  • Celebrity endorsements
Restraints & Challenges:
  • High costs
  • Consumer behavior
  • Lack of infrastructure

Global Circular Fashion Market Opportunities

  • The use of block chain: Radio Frequency Identification (RFID) tags, and other digital technologies offers huge potential to advance transparency and traceability in the circular fashion system. Recording information like fiber content, dyes, factory origin, etc. on blockchain ledgers can facilitate effective reuse and recycling. Digital ID tags and QR codes allow clothing life cycles and supply chains to be tracked. Adopting these emerging technologies is a key opportunity for the market. For instance, Circular ID partnered with 30 top fashion brands like H&M and PVH Corp. They issued 500,000 digital passports for resale of garments by 2023 as reported by World Economic Forum. This emerging sharing model where customers resell or rent branded apparel can disrupt the linear take-make-waste model, thereby significantly boosting fashion's sustainability.
  • Developing innovative bio-based materials and textiles made from agricultural waste presents an opportunity to expand circular materials. For instance, fabrics derived from milk, pineapple leaves, crab shells, and grape skins provide environmentally friendly alternatives to mainstream textiles. Advances in material science can help produce lower-impact vegan leathers, silk, and cotton to supply circular brands.
  • Partnerships and collaborations between clothing brands and textile recycling firms provide growth opportunities and can alleviate scaling challenges. Joint innovation allows the development of new products like hybrid recycled cotton-poly fabrics. Strategic partnerships also help brands incorporate recycled textiles in products and meet sustainability targets through access to recycling infrastructure.
  • Expanding resale, rental and subscription-based business models for apparel and accessories provides a major opportunity for market expansion. Online platforms like Rent the Runway, Nuuly, and Style Lend, which offer temporary access to clothes, are gaining popularity, especially among young consumers. Resale through thrift marketplaces is also rising. Scaling these alternative circular models will boost market growth.

Global Circular Fashion Market Trends

  • Supply chain transparency enabled through block chain, Artificial intelligence (AI), and other emerging technologies is a key trend shaping market growth. Solutions integrate blockchain to track clothing origins along with data analytics for monitoring environmental and ethical manufacturing practices. This provides brands with verifiable sustainability claims. For instance, a 2022 study by the non-profit Fair Labor Association found that 75% of apparel factory audits conducted globally still reported issues related to transparency in supplier relations and subcontracting without permission.
  • The use of sustainable materials like organic cotton, recycled polyester and regenerated cashmere is rising significantly. Consumers increasingly prefer products made using recycled textiles or environmentally friendly materials. This drives fashion companies to incorporate such fabrics into their collections. For instance, Roadmap To Climate-Neutral And Circular Textiles And Clothing report by the European Commission published in 2022, Europe faces significant challenges in scaling up technologies and processes required for low-carbon fiber production from industrial waste streams, agricultural residues and recycled textiles.
  • Rental, resale, and subscription-based business models are gaining prominence globally. Younger demographics are moving away from the fast acquisition and disposal of clothing. The growing 'closet in the cloud' trend will provide an alternative revenue stream for fashion brands.
  • Circular innovations in packaging, like biodegradable wrap and recyclable polymailers, reduce waste in apparel e-commerce and delivery. Returns and damaged items can be upcycled into new clothing tags and hangers. Sustainable packaging is an emerging trend led by start-ups.

Global Circular Fashion Market Restraints

  • Lack of adequate recycling infrastructure and capabilities is a major barrier, especially in developing countries. Sorting, cleaning, and processing diverse used textile waste streams requires advanced equipment and technology, which demands heavy investment. This constrains recycling adoption. For instance, according to a 2022 report by United Nations Environment Programme, only 9% of materials used by fashion industry are currently being recycled. Main barriers include the design of clothes that are difficult to recycle, a lack of EU-wide sorting, and a lack of economic incentive models for industry to shift to reuse and recycling over linear production models.
  • Counterbalance: Form reliable alliances with recycling businesses to provide clothing end-of-life solutions.  Make sure the materials used in clothes can be readily recycled into new fibers and clothing, keeping the materials in the production cycle.
  • Limited availability and high cost of recycled textiles compared to virgin polyester and cotton restrain its uptake. Producing recycled fabrics like rPET and rCotton is a complex, multi-stage process that results in higher prices. This deters many clothing brands from scaling their use despite sustainability benefits. For instance, in the 2022 report by the United Nations Environment Programme, the global collection and recycling rates for post-consumer textile waste hover between 15-20% – far below the recommended targets.
  • Counter balance: Encourage investment in businesses that are actively promoting the circular economy.
  • Difficulty in scaling up cycling of post-consumer textile waste into high-quality apparel grade fabrics limits growth potential. Upcycling utilizes existing materials, so it has less environmental impact compared to recycling. But inconsistent waste quality and a lack of technology pose adoption challenges. For instance, as per a 2020 United Nations Environment Programme report, the lack of convenient return and resale options available to customers at scale is a major barrier that limits the growth potential of the circular apparel industry.

Analyst View

The circular fashion market is poised for strong growth in the coming years. Younger generations, in particular, want to buy from brands with circular business models. The rental and resale markets have emerged as key opportunities to engage these ethical shoppers. Europe currently dominates circular fashion, with the U.K. and Germany at the forefront of rental and resale adoption. However, China and the U.S. present sizable opportunities considering their huge fashion markets. One restraint is the limited scale and availability of circular offerings relative to traditional retail giants. Established brands are cautiously entering the space as circular challenges mass production and consumption business models. Technology will play a bigger role in scaling circularity through items tracking, automated processing of pre-owned garments and enhancing user experiences on resale platforms. Policy support in the form of tax incentives and standards on garment durability and repairability can further accelerate the circular transition. In conclusion, while still at an early stage, circular fashion is an impactful way for the industry to become more sustainable and appeals strongly to younger, environmentally conscious consumers, making it one to watch in the coming years.

Recent Developments

New product launches

  • In September 2022, H&M launched a new conscious collection made from recycled materials like polyester and organic cotton. This supports the company's circularity goals. H&M, also known as Hennes & Mauritz AB, is a multinational clothing company based in Sweden that focuses on fast-fashion clothing. H&M has taken significant steps to become a more sustainable company and is committed to making sustainable fashion an everyday option for all. As of June 2022, H&M Group operated in 75 geographical markets with 4,801 stores under various brands. The company offers a wide range of fashion, home, beauty, and kids' products, and it is known for making fashion and design accessible to people around the world. H&M is also available as an online shopping destination, offering fashion, homeware, and kids' clothes with a focus on quality and affordability.
  • In June 2021, Levi's launched its most sustainable jean yet, made with organic cotton and circular techniques to reduce water waste. It reflects the brand's commitment to sustainability. Levi's is a clothing brand that has been around for over 50 years and is known for its denim products. The company has made a commitment to sustainability and has launched several initiatives to reduce its environmental impact.
  • In April 2022, Adidas partnered with Allbirds to design a 100% carbon-neutral shoe. This sustainable sneaker aims to reduce environmental impact. Adidas AG is a German athletic apparel and footwear corporation headquartered in Herzogenaurach, Bavaria, Germany. It is the largest sportswear manufacturer in Europe and the second largest in the world, after Nike. The company's official website,, emphasizes that Adidas is about more than just sportswear and workout clothes. It partners with the best in the industry to co-create, offering a wide range of sporting goods for various activities, including running, basketball, soccer, fitness, yoga, and hiking. Adidas designs for athletes of all kinds and creates sports apparel. Allbirds, Inc. is a New Zealand and American company that sells footwear and apparel. The company claims to keep its products as eco-friendly as possible and is a certified B Corporation.

Acquisition and partnerships

  • In September 2022, H&M partnered with The Renewal Workshop to improve transparency in its supply chain and make circularity measurable. The Renewal Workshop is an apparel company that partners with other apparel brands to recover the value in their unsellable returns and damaged products so that they can be sold again, creating a circular economy for the apparel industry.
  • In April 2021, Levi's acquired Beyond Yoga, a sustainably focused athleisure brand. This supports Levi's goal to lead in premium apparel.
  • In January 2020, Nike acquired Traceablee, a start-up focused on improving transparency through blockchain. This strengthens Nike's digital supply chain. Nike, Inc. is an American athletic footwear and apparel corporation headquartered near Beaverton, Oregon, United States. It is the world's largest supplier of athletic shoes and apparel and a major manufacturer of sports equipment. 

Figure 2. Global Circular Fashion Market Share (%), by Textile Source, 2023


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Top companies in Global Circular Fashion Market

  • H&M
  • Inditex (Zara)
  • Patagonia
  • Levi Strauss & Co.
  • The North Face
  • Nike
  • Adidas
  • Pact
  • Everlane
  • Reformation
  • Rent the Runway
  • ThredUp
  • The RealReal
  • Vestiaire Collective
  • Depop
  • Poshmark
  • Etsy
  • eBay
  • Tradesy

Definition: Circular fashion refers to an approach within the fashion industry that aims to create a closed-loop system, reducing waste and maximizing the lifespan of clothing and textiles. It aligns with the principles of the Circular Economy by rethinking how garments are designed, produced, used, and disposed of. Key aspects of circular fashion include designing for longevity and durability, using sustainable materials, implementing recycling programs, and promoting secondhand markets. The goal is to minimize waste and reduce the environmental impact of the production process by creating a closed-loop system where clothing items are designed, produced, used, and then recycled or repurposed in a way that minimizes waste and reduces environmental impact.

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Frequently Asked Questions

High costs, consumer behavior, lack of awareness, limited infrastructure, lack of technological integration, unorganized recycling systems, and limited supply chains are the key factors hampering growth of the global circular fashion market.

Sustainability awareness, strict government policies, advancements in textile recycling, celebrity endorsements, transparency & traceability, innovation, partnerships are the major factors driving the global circular fashion market growth.

The leading component segment in the global circular fashion market is organic. 

Major players are H&M, Inditex, EILEEN FISHER, Patagonia, Levi Strauss & Co., The North Face, Nike, and Adidas. , Pact , Everlane , Reformation , Rent the Runway , ThredUp , The RealReal , Vestiaire Collective , Depop , Poshmark , Etse, eBay , Tradesy

North America is expected to lead the global circular fashion market.

The CAGR of global circular fashion market is 8.8%.

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