Product is King

Renewcell is a textile recycling company based in Sweden whose mission is to reduce the apparel industry’s harmful impact on the environment. Renewcell produces CIRCULOSE®, a fiber that is produced from 100% textile waste.

Despite securing heavy investments from major apparel brands including H&M and Levi’s, on February 25, 2024 Renewcell decided to file for bankruptcy. What went wrong? Articles about this have been published. In Elsa Wenzel’s article on GreenBiz.com, she mentions the following possible reasons: 

  • brands supported the idea but were not fully on board – their interest did not translate into orders
  • CIRCULOSE® is higher priced than conventional, similar fibers
  • the management focused on operational efficiencies, not on customer acquisition

In these articles, no one has said Renewcell’s product sucks, or that the fiber makes poor quality fabrics. If that claim was made and was proven true, then no more would need to be said. No one said the product is fantastic, either. Renewcell’s message is that CIRCULOSE® is made in a way that could significantly reduce the apparel industry’s negative impact on the environment, by using recycled discarded clothes and textiles to produce it. The process makes fashion circular.

But processes don’t sell clothes, even if they would help save the planet. Fibers, Renewcell’s main product, doesn’t sell clothes either. Ask a customer what fiber they look for when they’re buying clothes. They would be puzzled. They look for style, fit, brand, quality, comfort, durability, functionality, and even for the convenience of the point of purchase – all these things are far removed from molecular-level fibers from which the fabrics in those garments are derived.  

CIRCULOSE® is higher priced than conventional rayon or cotton. And unless a customer is willing to pay more for it, an apparel brand would not have an incentive to buy it. Conceptually, the use of this fiber could offset an apparel brand’s carbon footprint, or show that it supports climate change, but there are other ways to accomplish these goals without directly affecting COGS and margins.

Only a demand for CIRCULOSE® specifically would justify the higher price that would be passed on to consumers. The circular nature of the manufacturing process alone is not enough to create a sufficient demand. But this story, validated with a superior product, could. As David always says, product is king.

Fiber companies that have made themselves known at the consumer level have been product-focused from the start. LYCRA®, GORE-TEX, and CORDURA® are highly functional fibers. TENCEL™, Bemberg™ , and Naia™ are sustainable fibers, but that’s of secondary importance to the physical characteristics of their fibers and their relevance to fashion apparel.

On the CIRCULOSE®  website you can learn about how the fiber is made, and see photos of apparel made from it. In the detailed section about the product, it is described as an alternative to other cellulosic fibers, and stated it can be sewn into “new high quality textile products,” without going into any product specifics. The only difference is how it’s made. Unfortunately, it’s not enough.

I hope that Renewcell finds a way to bring their impactful innovations into the global supply chain of textiles. They may need to re-think how they are presenting their end- product. Currently it is defined as something that helps the environment. But we’re looking for something to wear.