Most companies are driven by a desire to “do well” — make money, grow, increase brand reputation, gain influence, etc.  Professionals are usually driven by the same desires – make money, gain prominence and respect, increase power and control, rise through the ranks, etc.  Doing well is inner-focused.  It is driven by I and Me, as in ‘I lead a profitable company’ and ‘This raise is a financial boon for me’.   In the U.S., admiration is bestowed on individuals and businesses that do well according to these measures.  It is a competitive landscape that rewards self-interest and self-promotion.

Then there are those who are driven to “do good.”  “Doing good” is different from “doing well.”  Doing good is outwardly focused.  It is about helping those in need, making the world a better place, solving global problems, and caring about the community and collective.  It is outward-focused and other-centered.   It is driven by My and Our… as in ‘My community matters’ and ‘We need to care for our planet.’  Doing good is fueled by a sense of personal responsibility for the greater good.

Doing good and doing well may seem like opposites pulling in different directions, like two ends of a rope in a tug-of-war.  And it might seem those two approaches are at odds with one another.  But, perhaps, those two motivations are not diametrically opposed?   Maybe, that rope can form a circle, fueling one another in a virtuous cycle.  That is the approach some businesses are taking.  They are letting their “My” elevate their “Me”… the quintessential “Win-Win.”

Doing Good can also Help a Company Do Well

Recently, Levi’s Jeans put out a very strange statement to the world.  The $4.5 Billion denim manufacturer and seller asked for people to STOP buying so many pairs of jeans.  They weren’t saying “hey, buy less of our competitors’ jeans”.   Rather they asked people NOT to buy as many Levi’s Jeans.  In fact, their new ad campaign that launched in April 2021 – at the tail end of a year-long retail crisis prompted by a global pandemic – urged consumers to “Buy Better, Wear Longer.”

Levi’s Jeans – a clothing manufacturer and seller – said it wanted to sell fewer jeans.  To Levi’s employees, store managers and stock investors, this may sound absolutely bananas.  However, there is a legitimate reason for their clarion call.  As a global garment manufacturer in business for over 175 years, Levi’s knows firsthand a number of truths about the clothing industry.  First, clothing manufacturers make and sell over 100 billion garments each year for about 8 billion people.  In fact, the number of times a consumer wears a garment before throwing it out has dropped over the last 20 years, with many wearing an item as few as seven  times before tossing it.  That explains why the equivalent of one garbage truck of textiles and clothing is landfilled or burned every second.  Also true is that just 1% of all clothing is recycled.  And, water over-consumption and pollution from production and textile dyeing makes the fashion and textiles industry one of the least sustainable industries in the world.

Levi’s also knows that about six (6) billion of the garments produced annually (6%) are jeans.   Of all that clothing, jeans have the biggest negative impact on the environment.  The process of making jeans uses millions of gallons of water while spewing chemicals and greenhouse gases into the environment.  Over a decade ago, acknowledging their enormous impact on the planet, Levi’s Jeans decided to mitigate the problem.  They started by trying to produce jeans more sustainably.  The company took steps to decrease its environmental footprint by developing less-water-intensive materials and manufacturing practices.  They also sped up production times to better adapt to demand and avoid excess inventory.

But that was not enough.  In 2015, the company launched “Tailor Shops”, where customers could customize and repair products.  And, in October 2020, it launched a resale site, Levi’s Secondhand, where customers can buy and sell used jeans.  While those concepts generated a small fraction of the company’s overall revenue, the brand hopes to grow them quickly, potentially displacing new products.  Notwithstanding, this year, Levi’s admitted their incremental improvements were not enough.  So they decided to produce, sell and encourage consumers to buy fewer jeans.  Of course, while making and selling fewer jeans would be a big environmental step in the right direction, it would also be bad for Levi’s bottom line.  After all, fewer jeans sales would mean less profit.  Or would it?

That is the issue Levi’s and the rest of the $2.5 trillion fashion industry is tackling…. how to transform this industry into one that focuses on repairing, reselling, renting and recycling existing products.   That requires a complete overhaul of the industry’s business model, which is what the Ellen MacArthur Foundation, an environmental organization, advocates.  They want governments and businesses to transition from a linear, consumptive economy to a sharing and circular economy.

That is what Levi’s Jeans is doing… finding revenue streams that don’t rely on the manufacture of new products from raw materials.  And Levi is not alone.  There are many other companies jumping on the “My community… my planet… ” bandwagon.  Couture fashion designer Ralph Lauren has.  In addition to supporting the circular economy by launching a rental clothing business, Ralph Lauren’s rental collections will be part of an “after-use program.” Once Ralph Lauren determines the clothes have reached their rental cap, it will donate them to Delivering Good, a nonprofit providing new merchandise to people impacted by poverty and tragedy. Joining Levi’s and Lauren are other designers including Ann Taylor Loft, Diane Von Furstenburg, Armoire, Nuuly and Le tote.

In fact, women’s fashion label Eileen Fisher launched a take-back program to recycle old textiles. Since 2009, Eileen Fisher has been operating a program in which customers and employees can bring back old and unwanted Eileen Fisher garments for store credit.  And, in 2020, the company launched Eileen Fisher Renew and opened its Tiny Factory, a 21,000 SF warehouse north of NYC where old garments are refreshed to be resold or remade into something new, instead of being sent to the landfill.

Why are companies like Levi’s, Lauren, Ann Taylor and Ellen Fisher embracing a circular and shared economy?  It is because the value of a product is no longer determined only by the price consumers pay for it. The social and environmental performances of brands and their products play an increasing role in consumers’ choices.  Conscious consumers are shifting their decision making process. As the media increasingly highlights the environmental damages and social injustices caused by the production and/or consumption of products and services, consumers are actively seeking better alternatives by carefully looking at the materials used, the provenience and many other factors.

Indeed, a recent survey by GlobeScan of 27,000 people found that 77% of consumers were interested in durable products and 53% were interested in brands that reuse, repair, and recycle products they’ve bought. More than half were interested in buying fewer things in general.  These values are embraced particularly by people ages 15 to 40, which is the primary audience buying their products.

So can this process of embracing their My to fuel their Me work for other industries besides fashion / clothing?  Yes.  There are many companies that are doing good and also doing well.

Marrying Profits and Purpose

One such company is Toast Ale, a business that is turning old bread into profits and purpose.  As the third-largest source of global greenhouse gas emissions, food waste is a problem that is exacerbated by industrial bakeries which bake a lot of surplus bread.  Some of those unsold loaves get donated to soup kitchens.  But much more is sent to landfills.  Toast Ale sought to curb that.  Following the ancient practice of the Babylonians, who turned their old bread into beer, Toast Ale embraced this process as a way to tackle the issue of food waste.  With locations in London, NYC, Rio de Janeiro, Cape Town, and Reykjavik, Toast Ale works with local bakeries to source bread for its beers.   And their concern for the planet is so great that they even made their recipe publically available so homebrewers can recycle their stale bread instead of sending it to landfills.

But food and textiles are not the only industries where big reform can lead to big revenue.  There are many industries where new solutions are creating a virtuous cycle of good and gain.  Case in point.  There are 1.4 billion vehicles in the world today and over 2.7 billion tires are manufactured and sold annually to keep those vehicles moving.  Of the 2.7 billion made, 1 billion are disposed of and half go to either landfills or incinerators every year.  However, since 2007, Lehigh Technologies has been recovering the valuable resources in waste tires with its proprietary cryogenic turbo mill.  Their process freezes the rubber feedstock from waste tires and shatters it into micron-scale powder.  This Micronized Rubber Powder (MRP) is used as a raw material in a wide range of industrial and consumer applications, replacing fossil-fuel derived materials.  In 2017, Michelin Tires purchased Lehigh to help Michelin achieve its sustainability goals of using 80% sustainable materials in their tires and recycling 100% of their tires by 2048.  But Michelin is not the only company now using recycled tires for making new products.  Tires are being recycled into more than 110 products, from shoes to traffic cones and from garden mulch to asphalt for roads.  And tire-derived fuel is the largest market for scrap tires in the US.

Of course, there are countless other companies that are embracing the idea of both making money and making a positive difference by offering win-win business solutions.  Stay tuned next week as we look at the various business models that companies can adopt to turn their My into their Me and be able to do good and do well.  Stay tuned.

Quote of the Week

“If it can’t be reduced, repaired, rebuilt, refurbished, refinished, resold, recycled or composted, then it should be restricted, redesigned or removed from production. “
Peter Seeger

© 2021, Keren Peters-Atkinson. All rights reserved.