This post was originally published on this site
Nike Inc.
NKE,
has launched a program that will give a “second life” to returned shoes, an effort to address the consumer concern over climate change and environmental degradation.
Nike Refurbished will use tools to make shoes that are “like new,” those that have only had a couple of wears, ” or “gently worn” merchandise as close to new condition as possible,” the company says.
Shoes should be returned within the 60-day window. Once they’re placed back on store shelves, items will be marked with information about the renewed shoes, and they will be priced based on style and condition.
See: ThredUp CEO on IPO day: Don’t tax resale and Amazon’s speed is a fading trend for young shoppers
These items can also be returned within 60 days.
Returned items that don’t make it back on the shelf will become part of the Nike Grind program, which destroys merchandise so it can be used to make things like rubber flooring, outdoor courts and other shoes.
Nike Refurbished is launching in 15 stores across the U.S., but will expand to others.
Nike is launching this latest “circular consumer offering” at a time when resale and secondhand items are finding renewed life with consumers eager to do their part to save the environment.
According to the ThredUp 2020 Resale Report
TDUP,
the secondhand market will reach $64 billion by 2024, and is expected to overtake fast fashion, which has a reputation for packing landfills, by 2029. Forty percent of Gen Z shoppers bought secondhand clothes, shoes or accessories in 2019, and 30% of millennials did that year.
“Companies face increased public scrutiny about the industry’s environmental impact,” wrote Moody’s in a fashion and retail apparel report published this month.
“Responsible production is the biggest social risk, forcing companies to embrace
sustainable supply chain practices and transparency. Companies which want to
avoid reputational risk will prioritise embracing responsible sourcing strategies.”
ThredUp and Poshmark Inc.
POSH,
a company that sells both new and secondhand items, both went public this year, demonstrating the momentum of the resale category.
Also: Poshmark takes inspiration from old-school retail to create an experience for the future
And: Poshmark will benefit from shift to secondhand, consumers cleaning their closets
“More environmentally and socially aware customers are driving the
emergence of new business models such as renting or buying secondhand apparel,” the Moody’s report said, highlighting interest from younger consumers.
“Apparel companies will need to increase investment in product quality and sustainable materials. Fast fashion, mid-priced and small discount companies with limited resources or weak capital structures are the most at risk from these changing customer habits.”
BMO Capital Markets sees opportunity for Nike, and possibly others, as the retail landscape grows to include consignment, marketplaces, direct-to-consumer channels and more.
Don’t miss: Nike, MSCHF settle Lil Nas X ‘Satan Shoes’ lawsuit; refunds to be offered
“We continue to expect resale remains in its relative infancy and believe this is only the beginning,” analysts said.
Nike stock slipped 2.1% in Tuesday trading, and is down 5.4% for the year to date. The Dow Jones Industrial Average
DJIA,
is up 10% for 2021 so far.
