Products containing recycled raw materials should not be more expensive or of a lower quality than similar products.

Our latest trend report explores the circular economy, an alternative to the current “take, make and dispose” linear economy. It’s an old concept that’s steadily gaining ground as brands such as Puma start to rethink elements of the status quo. As part of our research, we interviewed Puma’s Stefan Seidel via email. Based in the company’s German headquarters, Seidel is deputy head of Puma’s Social Accountability and Fundamental Environmental standards group and has worked on that team since 2001. He discussed why and how Puma is implementing elements of the circular economy and a few of the inherent challenges.

What are the social drivers and business incentives for the shift to the circular economy?

On a global perspective, we see continued population growth. The percentage of the population in developing countries that is developing a lifestyle comparable to the Western world is increasing. While this is certainly a very welcome trend, it will continue to increase demand and stress on natural resources such as agricultural land and water.

As a consequence, we have already seen increased pressure on commodities such as cotton, for example, from a price point but also from increased competition relating to food crops, which may cause social concerns.

How does the circular economy fit into Puma’s commitment to sustainability?

With the results of the first Puma environmental profit and loss account, published in 2011, we realized that the extraction or creation of raw materials is responsible for the majority of Puma’s environmental impact throughout the whole supply chain. Based on this knowledge, we looked at options to minimize the environmental impact arising from these raw materials.

In terms of cotton, for example, we can lower the impact of cotton cultivation by choosing more sustainable cotton such as organic cotton. However, even more positive effects can be achieved when using even a small percentage of recycled cotton. We conducted an internal lifecycle assessment study in which we compared conventional, organic and recycled cotton. We found clear advantages to using recycled cotton over organic cotton in all major impact categories.

From a business and common sense point of view, it does not seem to make sense to grow cotton using large amounts of water, fertilizer and pesticides, go through complex ginning, spinning and weaving processes that require energy usage, and then pay for the disposal of the cotton at a landfill, where the material has no use other than filling up landfill space.

Our Puma InCycle collection has shown that cotton recycling of up to 50 percent is feasible, and we are determined to develop our recycled cotton program further.

What are the operating principles Puma has set in place for your Closing the Loop initiative?

Products containing recycled raw materials should not be more expensive or of a lower quality than similar products using conventional raw materials. Currently, this is still a challenging target. For example, we experience significantly higher prices for recycled polyester fabrics compared to conventional polyester fabrics. If we want the circular economy to become reality in our sector, we have to find commercial recycling solutions that do not cost more but less in the long term.

How has the Closing the Loop initiative changed Puma’s relationship with its consumers?

We have set up Bring Me Back bins in the majority of our stores worldwide. This sends a clear signal to consumers that their used clothing and footwear items contain value and should not be thrown away.

Have any interesting cross-sector collaborations emerged out of the Closing the Loop initiative?

For the Bring Me Back program and our InCycle collection, we have partnered with I:CO, one of the leading companies in the reuse and recycling of apparel and shoes. In the meantime, I:CO has also been partnering with a number of other fashion brands, such as H&M and our sister company Volcom, which also belongs to the Kering Group.

Another level of collaboration emerges at the Sustainable Apparel Coalition (SAC), which has recently launched a dedicated research project for recycling options of apparel products. With the SAC covering more than 40 percent of the global apparel industry, this collaboration has great potential to intensify research on the recycling-technology side and eventually change our industry.

For example, to date there are still no functioning automated sorting solutions available to be used at scale for apparel products, and the closed loop recycling of polyester only functions at a chemical recycling level and only for a rather limited amount of products at high cost. So there are still many technological challenges out there to be resolved.

How, if at all, has the Closing the Loop initiative strengthened Puma as an organization?

Closing the Loop has the potential to create the much-quoted “win-win” situation, where both the environmental impact and the financial performance can achieve significant advantages. Our experience shows that all too often, more sustainable raw materials and products are more expensive than conventional products.

As the definition of sustainability includes the social and the financial dimension besides the environmental one, we have to find solutions that are both financially viable and attractive to the consumer. Otherwise we have failed our mission.

What’s next for Puma and the circular economy?

In our annual report covering 2013, we describe a recycled polyurethane material that will be used for the soles of Puma football boots. It has the same quality as the conventional polyurethane but is cheaper to source. These are the kinds of solutions we need.

We will continue to sell attractive products made with recycled cotton. Together with our French parent company, Kering, we also support research on a recycling technology that would allow large-scale closed loop polyester recycling. This initiative is still at the research phase, but if successful, it has great potential toward closing the loop for polyester items, which make up approximately 50 percent of our apparel products.