The apparel fashion industry is giving importance to the circular economy more and more. And MonoChain, a London-based startup, is targeting for textile waste with a blockchain-powered platform that delivers authentication for products after purchase.
And consumers connect the clothing, they buy to MonoChain’s Wallet, consumers can count the value of their items, inspiring them to sell or donate instead of throwing away unwanted apparel.
Geri Cupi, CEO and Co-Founder of MonoChain said, “You don’t see anyone throwing away money. But they throw away items because they don’t understand their value.”
At present, only one out of six post-consumer apparel items get resold, but MonoChain goals to double that to a third. If an item’s lifespan is extended by just nine months through resale, it reduces the carbon, water and waste footprint for that garment by 20% to 30%.
MonoChain as a B2B2C platform keeps the consumer knowledge in mind, but its foremost goal revolves around shifting how brands derive economic value from what they produce by leveraging the secondary market.
The secondhand apparel market is currently valued at $28 billion, and it is expected to grow to $64 billion by 2024, according to a ThredUp report.
Additionally, research from the Ellen MacArthur Foundation estimates that more than $500 billion worth of value is lost in the fashion industry each year because clothing is not worn and is not often recycled.
By capturing some of the resale value of an item, Cupi estimates that a brand can double or even triple the profit on that garment. This mindset shift could deliver higher margins and allow companies to pull back on the volumes they produce without sacrificing profit. It will also prompt labels to make garments that are more durable and resale friendly.
“We want brands to produce fewer items but at the same time, to be done in a way that their bottom line doesn’t get impacted negatively. Our ethos is that capitalism and sustainability can coexist,” said Cupi.
Since launching in 2019, MonoChain has worked with six brands. The company began a pilot program with Levi’s at one of the denim brand’s brick-and-mortar stores.
An unpredicted influence of offering the blockchain certificate was a 16% uptick in basket size. Shoppers felt that merchandise was more reasonable since they knew they could later trade the items they bought. The pilot also showed consumer interest in the technology, as four out of 10 customers who were introduced to the concept during Levi’s pilot acquired a certificate and then later sold an item.
According to Cupi, one of the hurdles of using blockchain for authentication can be connecting physical assets to a digital record. As a solution to that, MonoChain has consumers scan items to create a verified link. The startup has differing levels of certificates ranging from a standard proof of purchase to solutions that require more verification, ideal for goods that are a bigger target for counterfeits.
While there have been traceability initiatives aimed at proving the provenance or sustainability credentials of a product to the end consumer, MonoChain is looking beyond the point of purchase.
“What we’re going to do is end-to-end traceability of the item from the moment it’s being produced to the moment that the item itself, or the materials used to produce the item, don’t need in the market anymore,” said Cupi.
MonoChain is eyeing the potential to close the loop by powering recycling programs in which brands could take back goods once they can no longer be used in their current state and turn them into new products.
“We have one enemy, which is the landfill. So if things go to the landfill, we lose as a business,” said Cupi.