Posted in GreenBiz
February 4, 2022

How startup ReCircled is designing for circular fashion


 

In the middle of the United States in Sidney, Nebraska, there’s a 800,000-square foot factory where workers disassemble clothes and shoes for their next life. It’s one of two facilities owned by ReCircled, a startup that describes itself as the “infrastructure for fashion in the circular economy.”

The two-year-old company aims to keep apparel and footwear out of landfills by keeping them in rotation longer through sharing, rental, repair and resale, as well as designing for circularity from the beginning by using materials that are durable and reusable.

Scott Kuhlman, CEO of ReCircled, has more than three decades of experience in the retail apparel industry with sales and apparel production — in the menswear industry with brands Hartmarx and Joseph Abboud and later launching product sourcing company Masko, which still exists — and has been using that as a jumping-off point to the circular side of fashion.

During those decades Kuhlman has worked closely with three people: his wife Susan, his partner for 30 years in all of their businesses; Flavio Mauro in Prato, Italy; and Kuhlman’s daughter Audrey.

“Initially we drug her and her older sister through factories and fabric mills,” Kuhlman told me. Since those younger days, Audrey has pivoted with them on ReCircled and now serves as the company’s director of customer relations and vice president of marketing.

“We’ve spent a lot of time working on everything from the raw materials, the fibers, all the way up to finished garments,” Kuhlman said. “We’ve got a very broad knowledge of the process of getting raw materials into a finished product.”

ReCircled is already working with more than 50 brands, including footwear company Merrell, according to Kuhlman. (The rest are under NDA.) The company’s workforce in the United States fluctuates between 80 and 100 people from month to month. In Europe, the employee roster is about half that.

As more brand partners come aboard, Kulman expects ReCircled’s workforce and number of facilities to grow. “In the United States, there’ll be many ReCircled facilities,” he said. “In Europe, there will be many ReCircled facilities. It’s a given. But we just have to start with one, and then we’ll get to two, three and four.”

I met up with Kuhlman virtually last month and discussed the company’s work with Timberland, the state of the circular economy for fashion and his vision for ReCircled in the next year.

This interview has been edited for length and clarity.

Deonna Anderson: There are more than a handful of companies doing this type of work. How do you see ReCircled as unique or different from the other companies that are providing the infrastructure to support the circular economy in fashion?

Scott Kuhlman: We spent 30 years in apparel, footwear and accessories manufacturing — a lifetime of working on new product. And then we started ReCircled a little over two years ago really to solve the problem of circularity, using the knowledge that we had to manufacture new apparel. And the question we asked ourselves is how do we simply reverse engineer the process?

I think we need to come together as an industry and make things more transparent about what’s possible today.

We knew there had to be a system and a process that had to be developed. There are bits and pieces that you can find for apparel and footwear circularity.

There’s processors. There’s textile recycling [which] has been going on for a long time. Rubber recycling, plastic recycling, that’s happened. The question is: Is it being done at its highest value, its highest properties, and do we have the opportunity to close loops and get that product back into supply streams? And the current system and the current recyclers of everyone we found, they weren’t working towards that goal.

We started with the end in mind, like a lot of people do, which is no landfill. And we ask this question every single day: How can we get this product back to our brand partners so that they can possibly use it? And that’s the difference maker, I think.

The second part of the equation we’re looking at is that we have the brand partners in mind because we know that for all of these circular activities, whether it’s upcycling or recycling, we have to find revenue streams. Because if we don’t find revenue streams, this isn’t gonna work. And so the first goal is to get this process to net zero for our brand partners. And then the second one is to actually find revenue streams.

I think that’s where we’re a little bit different … we’re not just recycling for a byproduct that then we can sell into that marketplace. We’re actually looking to build the process and system.

Anderson: How would you describe the state of the circular economy in fashion right now?

Kuhlman: We always use the words, “It’s the Wild West right now.” And the Wild West is just that. Everybody’s interested in it, but there’s just not a lot of knowledge about it, a lot of facts. There’s a lot of things that people read that aren’t necessarily true. And so first of all, it’s demystifying all of that.

I think we need to come together as an industry and make things more transparent about what’s possible today. And there’s a lot that can be done today. Two years ago when we started this, we always mentioned that everybody’s looking for the magic pill for circularity just to happen. And that’s not gonna happen, so that’s where the status is. We need more people starting. We need more brands just starting rather than talking about it.

Move beyond pilots because pilots don’t work. Build your road map. Build your process. Because it’s hard to recycle at the pilot level. It’s hard to build a long-term future if we can’t build that road map. So my thought for everybody within it is, “Don’t think about a pilot to see what can happen because we can tell you what a result can be.” Let’s build a roadmap to 2030, and then hit the milestones for them as a brand, and start. And it’s entirely possible for every brand and retailer to start today.

Anderson: When I was doing the Timberland story, I wondered what it took for these two companies to come together and actually build a takeback program like Timberloop. Can you describe the process of getting the program off the ground?

Kuhlman: The first thing I’d say is it takes a lot of faith among a big company like Timberland and VF Corporation. It takes faith in them jumping into the world of entrepreneurship and startups. We’ve got a proven track record in other businesses. But a year and a half ago when Timberland said, “Let’s do this,” we had no idea if we’re going to succeed or not. So they had the faith, and ability to say, “Let’s jump into this pool together and let’s figure this thing out.” They committed a lot of time from their side, not only just from a sustainability team, but they built into the DNA of the company to refinance through product development, through marketing. Everybody totally understood what the end game was. Now we weren’t going to get there on day one, but we were going to start, and they built a road map with that.

Racks of Timberland boots in the ReCircled facility

And so it took faith on their part. It took the entrepreneurship on our side to show them that we can solve the problems. Just tell us what they are. As entrepreneurs, that’s what we do. And then together through a collaboration, it’s not been pretty. It’s not been easy on either of our parts. There’s been ups and downs, hiccups and everything else. Frustration. But together, we can do it.

And I think if anything else that the partnership that we’ve built with Timberland, and now VF Corporation, is that it takes faith on their part and a willingness to make it happen.

Anderson: You mentioned there being challenges. With that in mind, can you share any learnings from working with Timberland so far and how you all like resolved them?

Kuhlman: Yeah. I mean it goes back to, as I just said, it’s very important to have this built in the DNA of the company. So if you think of a big company with lots of people, where they’ve got a finance team, they’ve got a marketing team, they’ve got a sustainability team, they have to get a lot of people onboard. And they ought to understand exactly what we’re trying to do from beginning to end. And sometimes doing things by committee, it’s hard [to get everyone’s buy-in].

The other challenge is just getting stuff done. It’s the time lag because even just starting what you think is a small little take-back program, there’s just a mountain of detail to do that because we’re tagging onto their system, their technology system. So with security issues and so on today, that’s a hard lift for everybody. And so that’s where just getting through the to-do list is a challenge because there’s so many to-do’s.

And now launching this as a global program where we’re launching it in Europe and the U.K., it creates a whole new set of challenges from all the language barriers to logistics. But again, things that can be solved. It just takes time and buy-in from everybody to sit down and solve it.

Anderson: I want to back up a little bit for more context. ReCircled was founded in 2020. The company has worked with Timberland and Avery Dennison. What else have you all been doing to establish yourselves as part of the infrastructure for the circular economy?

Kuhlman: When we started, we heard two words. One, it’s complicated, and the second, it’s expensive. We knew that for anything to be successful, it can’t be complicated for either the brand or the retailer or the consumer. We had to make it simple and user-friendly.

We looked at what’s available today, what’s not available today. And, again, it’s this process that we knew we had to build out first. We built the process for becoming circular regardless of if you’re super luxury or if you’re fast fashion. And quite frankly, it’s very interesting to see that it doesn’t matter what space you’re in — luxury, fashion, outdoor, whatever it is — the process is the same for everybody. There’s little nuances to it, but the process is the same.

The second thing we knew is we had to build the technology to drive this. And so we spent a lot of time and energy and investment in building a full technology stack that’s completely integrated that literally allows a brand to become circular overnight, starting with this take-back process all the way to our internal systems for cleaning, repair, for disassembly, for recycling through to resale and re-commerce, white label platforms, and all the reporting and data collection needed for moving this forward. So it’s a quite powerful technology stack that we built.

Then there’s facilities themselves. To do this work, it’s gonna take buildings and people. So we’ve been opening the spaces. We have two, one here in the U.S. and another one in Italy to handle Europe and the U.K. And we had to open the spaces not knowing really what we needed or what we needed to do. And so that’s where we built this flexibility into them.

We’re adding to them every single day with new processes, new things we’re able to do that we discovered along the way. So it’s really those three pillars over the last years that we’ve built a very solid footing for process technology and facilities.

Anderson: Why was Prato, Italy, a good place for a facility?

Kuhlman: [Prior to ReCircled], we’ve had an office in Prato, Italy for 25 years. If you don’t know Prato, Prato is the center of textile recycling. They’ve been doing it for decades. And they figured it out a long time ago. I think it’s almost 100 years ago when they figured out how to recycle textiles, and they did it out of need. But we’ve worked with fabric mills in the Prato area on product production, on new product production using recycled fabrics, yarns, et cetera for a long time just because that’s where we’re at.

To be very transparent, we’re familiar with Prato. We have an office. We had people, so it was easy to do. It’s also turning out to be the right move because as we got into footwear and accessories — Tuscany and Florence and Prato and Empoli and Lucca, that area is the bastion of leather and footwear production, as well.

Suppliers are literally inventing new machines for us right now to disassemble footwear. And so it’s been a great move on our part to be in the right area to do it.

And they are terribly interested in finding these ways to close loops, to do the R&D around what we need to do to recycle rubber. We’ve come up with a way to use rubber soles and create new rubber soles. We’ve done it with — we’ve created the first re-leather process where we’re using post-consumer leather to create new rolls of leather. All that was developed in Italy, and so that’s where we’re just very fortunate to have them as our partners in this.

Anderson: I want to go to Prato now just to see how everything works.

Kuhlman: I’m telling you, you’d be fascinated by it. And what’s interesting is [circularity] is a given there. For us, this is all new and fascinating. For them, it’s just like it’s a way of life. And that’s fantastic because they’ve got this knowledge base.

Anderson: As a CEO of ReCircled, what do you envision for the company in the next year?

Kuhlman: The vision is we just have more brands and retailers saying yes to this road map. And that more [people in the C-suite] understand the process that needs to take place. There’s sustainability teams. There’s product teams.

You and I and everybody involved understands what we have to do. But as a CEO of a clothing or footwear brand, they have to look at the number of units they’re producing, and they have to raise their hand and say, “We’re gonna take care of 100 percent of those all the time. What is the process and system we have to get involved with to do that?” And I don’t think they have that understanding. And it’s an education process.

That’s my vision, just more C-levels jumping in and saying yes, and empowering the people to do what’s really needed to make it happen. And if that happens, we’re gonna move along.

And it is, slowly. A lot of brands are working with the public companies. Their boards are getting involved. We’re seeing more C-level people on phone calls and Zooms. So it’s starting. But we gotta do more.

 

February 4, 2022 at 03:15PM

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