Tremors ran through the apparel industry with the announcement of Renewcell's bankruptcy, but assigning blame is easy — it's finding solutions that will be hard, writes Robert P. Antoshak, partner at Gherzi Textile Organization.

The angst among environmental advocates was palpable after Renewcell shared its bankruptcy woes with the apparel sector. 

Then, the finger-pointing started. Teeth were gnashed, and hands were wrung. Renewcell’s management took heat, as did their customers — the brands. Indeed, Renewcell’s hype seemed to have failed to live up to the realities of brand interest and suffered from limitations built into its supply chain. Ultimately, the company needed more time to perfect its product, processes, and access to the market.

Sure, the environmental community was disappointed, but it was also a wake-up call to snap out of the sustainability echo chamber and reengage with our industry’s realities. In many ways, Renewcell struggled with the Catch-22 many start-ups face: building a viable product while simultaneously creating demand. It’s tough.

Apparel’s blame game for Renewcell’s bankruptcy 

Assigning blame for an early-stage start-up’s bankruptcy doesn’t say anything. Choices made by Renewcell’s management resulted in the enterprise’s failure. But that’s the point: a for-profit enterprise tried to bridge the gap between feel-good environmentalism and practical business.

On the other hand, blaming brands for being short-sighted doesn’t make sense, either. Brands are in the business of making money; they are not in the business of saving the planet or adopting environmental solutions that make little business sense. If there are any takeaways from the Renewcell experience, innovators must clearly make a business case to customers, or there’s little chance of success.

Renewcell may have failed, but that’s also the process in business: trial and error. Fail today to succeed tomorrow. It’s capitalism, folks.

Does Renewcell bankruptcy signal apparel sector was not ready? 

Think back. Remember the Newton? A precursor to the iPhone, it flopped horribly in the marketplace and nearly took down Apple. But the concept of a hand-held device capable of being everything from a digital assistant to a music player wasn’t wrong. Its format wasn’t quite fully baked. And it was ahead of its time from a technological standpoint.

In short, Newton wasn’t ready for Prime Time. Yet that failure directly led to the iPhone. From failure came success. And a changed world. It took time and further innovation, but eventually, a world-altering device emerged.

So, it’s lazy to blame Renewcell’s failure on its management or criticise brands for failing to buy more of Renewcell’s fibre. Sure, assigning blame is always easy, but what about devising solutions? After all, our industry is all about finding solutions to problems — and that’s hard.

Unfortunately, when it comes to recycling, there hasn’t been a bullet-proof solution that can scale to meet the industry’s needs. Sure, other options (such as mechanical recycling) claim to solve the industry’s waste problem, but a scalable one-size-fits-all solution remains elusive.

Undoubtedly, folks may wish to change the world, but change is hard to enact without convincing an audience first of its business merits. Too often, the pitch centres on the apparent benefits of green, while not enough time is spent on the realities of the marketplace. The business case needs to be made. Dubious statements about water usage, carbon footprints, waste, and so forth only create an echo chamber and fall prey to marketers’ objectives.

The same can be said of the Renewcell situation. It’s easy to second-guess their management or accuse the brands of short-sightedness. The concept was correct: it is time to find a way of recycling the industry’s waste on a large scale. Unfortunately, the industry and technology aren’t there yet.

Are consumer attitudes changing? 

This brings us to consumer behaviour. Blaming consumers for their purchasing choices is lazy. People will buy what they will buy for a myriad of reasons. However, when it comes to sustainability or circularity, many consumers don’t know better, and even more couldn’t care less. Can they be blamed for passing over a sustainably made garment with tags of programmes they know little about and instead choosing a cheaper garment from a brand they know? In this sense, the industry has a responsibility to educate its customers.

Moreover, many consumers couldn’t care less about environmentalism. All they care about is price and ease of buying stuff. Temu and Shein’s success demonstrates this in spades.

I recently participated in a government hearing where I heard industry testimony downplaying the importance of price. Government hearing or not, it sounded like spin to me. We’re in a commodity business, and cost is always paramount. It also sounded a lot like brand marketing.

So many brands proclaim: “Why, of course, we believe in sustainability.” That’s until the price comes into play. Stuff like sustainability incurs a cost that brands often pass back to their suppliers to pay for. I remember being at a cotton organisation meeting a few years ago, where brands cheered the group’s efforts but touted that such efforts would only be possible with cost neutrality. Huh?

Apparel industry described in two words

“Cost neutrality” is a clarion call for the apparel industry. Gosh, those two words have caused more harm than good when it comes to innovation. No wonder the trade often functions like some whirlpool sucking everything down some bottomless vortex. A race to the bottom? It’s more like plumbing the depths of some black hole.

Paying for innovation is not cheap. Genuine innovation comes with actual costs — and risks. Get over it, brands. But for the green innovators out there, you get over it, too. It’s foolhardy to think you can impose your will on brands with products that either don’t work, need more time to be ready, or fail to make a compelling business case for change. Yeah, advocacy has its shortcomings; idealism will only go so far — in some cases, bordering on naivete.

Learnings from the Renewcell experience

The apparel industry should learn from Renewcell’s experience and indeed bankruptcy. There’s a deepening tension in our industry between those who want to address many of its shortcomings and those who only feel compelled to change something, at least once they have to. And many fear government regulations.

Is waste a problem for our industry? Of course. What about pollution? Yep. And abuse of workers’ rights? You bet. These are serious problems that deserve serious solutions. Lots of intelligent, passionate people continue to work towards devising solutions all over the world.

So, after the Renewcell experience, should the industry throw its hands up in the air and give up trying to solve its waste problem? Of course not. Besides, it’s always possible that some entity may acquire Renewcell’s assets. Who knows? The technology could be relaunched but with a new approach to the market. Remember: from the failure of Newton came the iPhone!