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Digital innovation and circular business model innovation are two critical enablers of a circular economy. A wide variety of digital technologies such as blockchain, 3D printing, cyber-physical systems, or big data also diverges the applications of digital technologies in circular business models. Given heterogeneous attributes of circular business models and digital technologies, the selections of digital technologies and circular business models might be highly distinctive within and between sectorial contexts. This paper examines digital circular business models in the context of the fashion industry and its multiple actors. This industry as the world’s second polluting industry requires an urgent circular economy (CE) transition with less resource consumption, lower waste emissions and a more stable economy.

An inductive, exploratory multiple-case study method is employed to investigate the ten cases of different sized fashion companies (i.e. large, small medium-sized firm (SME) and startup firms). The comparison across cases is conducted to understand fashion firms' distinct behaviours in adopting various digital circular economy strategies.

The paper presents three archetypes of digital-based circular business models in the fashion industry: the blockchain-based supply chain model, the service-based model and the pull demand-driven model. Besides incremental innovations, the radical business model and digital innovations as presented in the pull demand-driven model may be crucial to the fashion circular economy transition. The pull demand–driven model may shift the economy from scales to scopes, change the whole process of how the fashion items are forecasted, produced, and used, and reform consumer behaviours. The paths of adopting digital fashion circular business models are also different among large, SMEs and startup fashion firms.

The study provides business managers with empirical insights on how circular business models (CBMs) should be chosen according to intrinsic business capacities, technological competences and CE strategies. The emerging trends of new fashion markets (e.g. rental, subscription) and consumers' sustainable awareness should be not be neglected. Moreover, besides adopting recycling and reuse strategies, large fashion incumbents consider collaborating with other technology suppliers and startup companies to incubate more radical innovations.

Appropriate policies and regulations should be enacted to enable the digital CE transition. Market patterns and consumer acceptances are considered highly challenging to these digital fashion models. A balanced policy on both the demand and supply sides are suggested. The one-side policy may fail CBMs that entail an upside-down collaboration of both producers and consumers. Moreover, it is perhaps time to rethink how to reduce unnecessary new demand rather than repeatedly producing and recycling.

The pace of CE research is lagging far behind the accelerating environmental contamination by the fashion industry. The study aims to narrow the gap between theory and practice to harmonise fashion firms' orchestration and accelerate the transition of the fashion industry towards the CE. This study examines diverse types of digital technologies in different circular business models in a homogeneous context of the fashion industry with heterogeneous firm types.

Australians consume twice the global average of textiles and are deeply engaged in a linear take/make/waste fashion model. Furthermore the Australian fashion sector has some unique supply chain complications of geographical distances, sparse population and fragmentation in processing and manufacturing. This research aims to examine how Australian fashion small to medium enterprises (SMEs) are overcoming these challenges to run fashion businesses built around core principles of product stewardship (PS) and circularity.

SMEs make up 88% of the Australian apparel manufacturing sector. This qualitative exploratory study included in-depth interviews with three Australian fashion SMEs engaged in circular design practice, and a focus group of 10 Western Australian fashion advocates of sustainability. Analytic coding and analysis of the data developed eight distinct themes.

This study examines the barriers to circular economy (CE) that exist in the Australian fashion sector, and maps the practice of Australian SMEs with circular business models in overcoming these barriers. In CE innovation, Australian SMEs may have an advantage over larger fashion companies with more unwieldy structures. Employing design-thinking strategies, Australian SMEs with a foundation of PS and circular purpose are creating new systems of viable closed-loop business models and design processes.

The themes from this research contribute to the limited literature on circular innovation examples that link CE theory with practice in the fashion sector. The model for circularity maps the practice of three SMEs built around core principles of PS and circularity in overcoming the barriers to CE in an Australian context, and may be used as a visual tool in education and understanding.

Fashion/textile small- to medium-sized enterprises (SMEs) are currently adding value to previously discarded textile waste by applying practical skills, knowledge and expertise to rework and reuse this material. As a result, sustainable design strategies such as zero-waste pattern-cutting, design for disassembly and upcycling are beginning to emerge. However, the scope for redesign will always be limited and the complete lifecycle of the material used needs to be considered at the front-end of the innovation process, to optimise material lifespans and reduce consumer waste. Further work is also required to inspire and educate the next generation of designers to the creative potential of reuse, and help the industry to understand its viability, scalability and role in the future. This chapter explores how the principals of the circular economy might support business model innovation within fashion and textiles. To this end, an exploratory canvas tool for SMEs, ‘Circular by Design’, was devised to aid SMEs to embrace closed-loop systems and to identify the most appropriate sustainable design strategies for their business.

The COVID-19 pandemic has caused irrefutable devastation globally. Yet, academic and trade commentators have claimed that this disruption could have had a silver lining by presenting the fashion industry with the opportunity to reassess and rebuild in a slower, more considered way. Part of this reassessment, some have argued, may have been allowing the industry's pre-COVID sustainability buzz to come to fruition by nudging the fashion industry to go circular. This paper explores if, and how, the COVID-19 pandemic was (not) nudging the industry towards circularity using the case study of circular textiles.

Serial, semi-structured, qualitative interviews were conducted with three buyers and sourcers working for three UK-based fashion retailers. Each participant was involved in three interviews in June 2020 following the UK's first national lockdown.

The research findings suggest that, at the time this research was undertaken, these retailers were focussed on regaining profit, protecting their supply chains and producing “safe” designs whilst cutting back and becoming more risk averse. These actors suggested that, in contrast to the suppositions made by academic and media commentators, the COVID-19 pandemic was acting as a hindrance to circularity, not a helping hand, as retailers were less willing to invest in circular textiles at that time than they were pre-pandemic.

This paper offers valuable insight into the COVID-19 pandemic's impact on circular innovation within fashion retail whilst contributing to broader understandings of the principles of the circular economy within textiles and design.

The purpose of this paper is to discuss how organisational complexities influence the design of circular business models, which have recently been introduced as a new panacea for aligning the interests of business with the needs of the environment.

The Service Shirt, a new garment concept, is used as an illustrative case example for demonstrating some of the organisational complexities of making circular business models operable. The shirt was developed through a series of design workshops for the fashion brand Fashion Alpha.

The analysis highlights multiple challenges emerging when a fashion product with a significantly extended lifecycle passes through different users, organisations and business models. It is concluded that it is difficult to talk about a circular business model (singular) as circular economy solutions depend on the contributions of multiple stakeholders with business models.

The findings illustrate how fashion companies interested in the circular economy fundamentally have to rethink conventional approaches to value, organisational boundaries and temporality.

Drawing on a case example from the fashion industry, the paper demonstrates the organisational complexities linked to the design of new business models based on circular economy thinking, as these require the coordination of actions between autonomous actors driven by different logics regarding value creation, value delivery and value capture.

The purpose of this paper is to explore consumers’ views and expectations on circular clothing. This paper also clarifies how the remanufacturing process should be communicated and circular fashion marketed to consumers.

The research methodology consisted of consumer interviews, utilising an online innovation platform (Owela) to involve consumers and workshops with project partners and with external stakeholders.

Consumers’ interest towards recycling and sustainable solutions has increased. They appreciate the idea of recycling textile waste to produce new clothes; circular products should become “the new normal”. Consumers are asking for more visible and concrete information about circular clothing and how their behaviour has affected the environmental aspects of textile production. The communication should be timed correctly by using multiple communication channels and also paying attention to the shopping experience. In addition, digital services alongside circular clothing could create additional value for consumers.

In this study, only consumers from Finland were involved. The results might be different in different parts of Europe and especially worldwide.

This study focusses on circular clothing – an area that has not been studied much before. Also, consumers involved in this study were of a different age compared to most of the previous studies, where the focus has been mainly on young college students.

The purpose of this paper is to examine the challenges and solutions emerging when fashion brands develop and test circular economy solutions within their existing business models.

The paper is based on a 34-month case study in a global fashion brand, which launched a new in-store product take-back initiative.

The results indicate that fashion brands need to cope with multiple challenges in the process of developing circular business models in the organization, including: diverging perspectives of value and unclear success criteria, poor alignment with existing strategy, limited internal skills and competences, and limited consumer interest.

The results of this paper are grounded in a single case study and thus limitations associated with broad generalizations apply. In addition, the paper only investigated one aspect of circularity, namely, product take-back and did not investigate design for circularity, product reuse, recycle and other circularity related issues.

The findings derive from practical experiences of a fashion brand implementing an in-store product take-back system in the existing business model. The study reveals new insights into the actual process of making circular fashion operable.

The purpose of this paper is to explore the drivers, inhibitors and enablers of creating a textile-to-textile recycling system in the Scandinavian fashion industry. It investigates the technology, innovation and systemic changes required to enable circular supply chains.

The research study uses a qualitative, interpretivist approach, drawing on in-depth semi-structured interviews with stakeholders in the Scandinavian fashion industry.

The main inhibitors to textile-to-textile recycling systems in the Scandinavian fashion industry are: limited technology which creates a challenge for separating materials; high costs of research and development and building the supporting logistics; complexity of supply chains including the multitude of stakeholders involved in product development. The enablers are design and use of new materials, increased garment collection and collaboration. This research suggests that sorting and recycling technology can be enhanced with the use of digital technologies, as this would create transparency, traceability and automatisation.

The research is limited by a small sample size and lack of representation of all key stakeholder groups, which limits the ability to generalise these findings. However, as an exploratory study, the findings provide insights that can be further tested in other contexts.

Understanding of textile-to-textile recycling is emerging both theoretically and practically, however, there is still much that is not understood. This research contributes to furthering understanding of how technology, collaboration and systemic change in the fashion industry can support opportunities for textile-to-textile recycling, thereby aligning with circular economy principles.

This chapter highlights how implementing circular economy principles can help companies working with sustainability to move from a reductionist and waste management approach to marketing competitive circular value propositions that intentionally design out waste (e.g. emissions and pollution) by rethinking, reinventing and redesigning the value chain. Schijvens, a Dutch family-owned corporate fashion textile company, acts as a case for exemplifying successful implementation of circular economy principles as a marketing strategy in a sector that struggles with finding solutions to the ethical challenges of producing and marketing textile fashion. The textile industry has, for many years, been accused of production that is based on environmentally harmful processes and conditions that are not socially fair. Circular economy principles provide a range of suggestions to address the ethical challenges occurring from covering the human needs of having clothes to wear. Yet, implementing circular economy principles is not a panacea. It is not only a question of delivering a technological quick fix but also a question of managing the new processes and human mindset guiding the actions in the value chain. This chapter, therefore, outlines reasons for a different perspective on the traditional linear value chain and related implications managers face when undertaking a journey from sustainability based on a reductionist approach to a closed-loop approach. It is argued that implementing circular economy principles by pro-actively managing the value chain processes based on eco-centric dynamic capabilities can provide even more radical changes than the incremental reductionist approach often associated with being a green sustainable company.