Lindex, following up on sustainability promise

In the long term, Lindex’ aims to integrate their take-back and resale model into their core business and even invite cannibalisation of primary sales.

By Gwen Cunningham and Andreea Theodora Baniceru

the team

Lindex is one of Europe’s leading fashion companies, with approximately 460 stores in 18 markets and sales online and offering inspiring and affordable womenswear, kidswear, lingerie and cosmetics. 

A cross-functional Lindex team joined the Switching Gear project:
Director of Strategy & Business Development
Strategy Lead Circularity & Environmental Sustainability
Strategic Project Manager
Sales Channels Operations Manager
IT Technical Services Manager
Group Business Controller
Customer Research and Service Design
Assortment Manager
Head of Sales Operations

the urgency

Lindex’s ‘sustainability promise’ is to make a difference for future generations by empowering women, respecting the planet and ensuring human rights.

For Lindex, who had already established a form of take-back and reuse with partners since 2014, joining the Switching Gear project was about taking their commitment a step further. Lindex recognised the clear environmental urgency for circular business models and also noticed an increasing demand for them in their customer base. In addition, the business opportunity and rationale was important to them. Lindex understood that if they truly wanted rental or resale to be the way garments are traded going forward, then they should make it part of their own commercial offering and make it financially viable.

The customer need

The Lindex resale business model serves two different customer needs. The take-back offers an easy and environmentally friendly solution to parents who have unworn baby or kids outerwear at home that they want to get rid of in order to make space in the closet. Meanwhile, the resale of pre-owned baby and kids’ garments offers environmentally conscious parents high quality, functional outerwear at a good price.

The business model

The Lindex resale pilot was launched with a geographical focus on Sweden and the short term objective is for the model to be at least financially self-sufficient. In the long term, however, Lindex aims for the circular business model to be both scalable and profitable. 

The expected positive impact

The transition towards a circular business model - resale - is part of the brand’s growth strategy with the ultimate goal to decouple growth from production volumes by ensuring all garments are designed for longevity and circularity.

The prototype

Before rolling out their pilot, Lindex launched a prototype for the take-back programme and resale of baby and kids’ outerwear. They reached out to customers who had purchased baby or kids’ outerwear in the last three years to offer them the opportunity to return the outerwear they no longer used to two stores in Gothenburg or online in exchange for a fixed value gift card of 10-20% of the original resale price of the returned garment. 

To be able to also test their resale model, Lindex only collected high quality outerwear which could later be resold in selected stores. Their second hand offer was sold out within a few days, proving the customers’ interest in such an offer.

PILOT OUTCOMES and lessons learnt

Since its launch in May 2021, the aim of the pilot was not to sell large volumes of pre-loved products, but rather to gain insights on customer needs and preferences by testing a number of take-back and resale solutions in the market. Lindex began by taking back kids' outerwear, but has since expanded to accept all kidswear through the postal drop-off collection method. The brand has also experimented take-back for womenswear with help from charity partner Fretex in two of its stores in Norway. Digital and online tools proved to be the most popular options, especially when made extremely simple - customers do not need to print out anything, but can simply register the package with a QR code on their phone and use any recycled packaging from home. Regarding the resale process, multiple channels have been tested out - in-store resale offering, resale only pop-up event, online resale - and each of them was equally successful. 

In 2021 Lindex collected around 1,000 pieces and in 2022 approximately 30,000 pieces, 80% of which were in great condition and resellable. The remaining 20 percent is being analysed, and the insights gathered will be shared with the design teams to inform their work and ensure all Lindex products are designed for longevity and circularity. Simultaneously, the teams are testing different methods of upcycling. 

Lindex's biggest challenge right now is moving from pilot to scale and developing the right systems and infrastructure for this new business model. This year, they moved post-consumer garment processing from the headquarters to the warehouse, and have hired a new team member to oversee the backend. The brand has realised that its existing systems and databases were inadequate to enable this new business model. The broader their take-back criteria was, the more complex and varied the products they received back were, and the more advanced the sorting and renewal processes needed to be. In the existing system, each process covers thousands of items, whereas in the new system each unique piece has its own separate set of operations, from photographing the item to registration and logistics. Therefore, this system needs to be built from scratch.  

What’s next?

Circular business models are a key part of Lindex's sustainable growth strategy. Therefore their core focus in the coming year is to build on the pilot's successes, invest and take the steps needed to enable it to operate at scale. 

What ADVICE DOES LINDEX HAVE for other brands that are looking to Build a Circular Business model?

Follow the Switching Gear methodology of develop - test - iterate. Don't presume you have all the answers. Follow data, not opinions,” says Annette Tenstam, Strategy Lead Circularity & Environmental Sustainability at Lindex. 

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