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In the Loop

Is rental really the worst?

The business model was recently deemed “the worst green option.” But the devil’s in the (assumed) details.

 E-commerce, fast fashion, technology and logistics illustration.

This article originally appeared in our Circularity Weekly newsletter. Subscribe here

Earlier this summer, a slew of headlines showered doom and gloom on clothing rental schemes, proclaiming them "the worst green option," "worse for the planet than just throwing [clothing] away" and "no cure for fast fashion."

All this vitriol came in the wake of a Finnish report that compares the global warming potential of a pair of jeans under five ownership and end-of-life scenarios: traditional use and disposal; extended use; resale; recycle; and rental. Using life cycle assessments (LCAs), the study concluded that "sharing" or renting a pair of jeans produced the highest volume of carbon emissions — about 5 kg more CO2 than simply throwing the jeans away.

If we take these headlines at face value, rental models should be a thing of the past rather than a model for the future with endless possibilities, as some coverage has suggested. But as with all things in the world of circularity, this story requires some context and a healthy dose of nuance — so let’s dive in. 

The devil’s in the (assumed) details

The report uses LCA methodology, a process that evaluates the environmental impact of a product or service from cradle to grave by relying on numerous assumptions. As an example, the report assumes 200 wears before jeans are disposed of, that jeans are washed every 10 uses, and that purchasing two pairs of used jeans will displace the need for one newly manufactured pair. These assumptions are built from a specific scenario and setting, and a slight shift in these numbers could drastically alter the report’s outcome. All that to say, the assumptions and their conclusions come with "uncertainty," a word the report’s authors use no less than seven times.

As with all things in the world of circularity, this story requires some context and a healthy dose of nuance.

As critiques of LCAs have long pointed out, this methodology fails to account for human behavior and behavior change between scenarios. After all, a second-hand shopper or renter is likely to treat their garments differently from a traditional consumer — potentially holding on to them longer, washing them at a different frequency or replacing them at a different rate. Indeed, LCAs have been criticized for their shortcomings, particularly when it comes to evaluating circular initiatives

Of course, LCAs and their assumptions are critical to allow for an apples-to-apples comparison. "Only what gets measured gets managed," Ola Bąkowska, a project manager at Circle Economy’s Circle Textile Program, shared with me over email. But LCAs offer "only part of the information… [They are] not sufficient to assess all the benefits of clothes in the rental business model compared to business as usual." 

No carbon is an island 

Speaking of only part of the information, the report is quick to acknowledge that its focus is exclusively on carbon emissions and their "global warming potential" (GWP). As the report notes, "our focus on GWP impacts has left implications for other important sustainability dimensions — such as water use, toxic chemicals and waste generation — outside the scope of this study."

By not considering impact on water consumption, biodiversity and communities at large, this report offers only one piece of the sustainability puzzle.  

"We urgently need more detailed research on the assumed and unexpected implications of diverse [circular economy] strategies," the report adds. I’d argue such research is critical to understand rental’s full scope of benefits and drawbacks before we throw this potentially impactful model under the bus. 

Reevaluating rental

It’s important to note, the report raised some genuine red flags for rental. As with all business models, slapping a "circular" sticker on them does not inherently make them more sustainable.  

Rental services — particularly for clothing — can require more logistics, often including more shipping, packaging, cleaning or washing and, by association, carbon emissions than traditional linear consumption. "Circular business models are not climate positive by definition," Bąkowska noted. Accordingly, they deserve our scrutiny before we call them green. 

But given the narrow assumptions and limitations of this report, I’m hesitant to brand rental schemes as unsustainable either. So what would it take to make rental the eco-friendly option? Here are three recommendations that could bring rental back from the environmental brink:

1. Design with sustainability in mind

"In order to create a sustainable business model, you have to consider sustainability at every point in your product or services life cycle," Jay Reno, CEO of furniture rental company Feather, told me via email. 

To start, this requires designing products with climate friendly materials and manufacturing — as the report finds, more than half of the carbon emissions associated with a pair of jeans occur during manufacturing, no matter how they are used or sold. But the sustainable design lens should not stop there.

Reno added, "Many brands might consider sustainability at the beginning of the life cycle — say, when a pair of pants is created… But what really moves the needle for sustainability is considering what happens once those pants leave your warehouse." Considering how a product might wear and tear as well as their aesthetic appeal over time can lead to more durable, repairable and timeless design — and products that last longer require less carbon, as the report points out.

Many brands might consider sustainability at the beginning of the life cycle. What really moves the needle for sustainability is considering what happens once those pants leave your warehouse.

Additionally, carefully designed rental services can require less washing and maintenance between users, or leverage low- or zero-emission transportation. As Bąkowska added, "It will be very different if you pick up an item by bike from your local clothing library than if you ship it from a remote place. This is why the service design of a rental business model is of core importance to achieve a desired social and environmental impact."

2. Don’t stop at rental

Rather than simply offering a rental scheme, combining multiple circular solutions in one business model could unlock the most environmental savings. A rental service could save significant carbon, materials and waste by extending product and material life spans with durability, repair services, product resale and material recycling. As an example, Feather leverages durable and versatile design, refurbishment, recommerce, upcycling and donation partners to extend their products’ lifespan and reduce environmental impacts. 

In fact, one of the report’s oft-overlooked analysis explores the reduced carbon impact of rental models that leverage product life extension and more sustainable service design through low-carbon transportation. The results? The carbon footprints of these rental models drop below traditional linear consumption, making the take-make-waste model "the worst" option, yet again.

3. Shift the system

As recent reports and coverage continue to confirm, the challenge is that fashion’s current model is inherently unsustainable. No matter if products are rented, resold or simply consumed, we are producing too much stuff.

As the report itself outlines, "In the textile industry, massive over-production is a system-level problem that cannot be tackled only with the development of more efficient recycling options for end-of-use products." We need to shift the system and reduce "the total amount of products" available as well as the overconsumption this volume of goods encourages.

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If rental services spur more linear consumption, they have failed their sustainability charge and are indeed "the worst option." But when designed right, they can lead to less production and evoke behavior change that encourages more thoughtful, reduced consumption. As Reno shared in a Circularity 21 panel, rental has the power to "transform humanity’s relationship with material goods —[to give somebody] a different relationship with their stuff…" 

That’s what rental models should be striving for — and when that’s achieved, I won’t hang rental out to dry.

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