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American luxury brand Coach spent the last week scrambling to contain a backlash over allegations it had destroyed unsold inventory after a viral Tiktok video showed a steady stream of handbags that had been slashed across the front.
Coach says the video is inaccurate and misleading and has pledged to eliminate product destruction “wherever possible”. Global head of digital and sustainability Joon Silverstein says that Coach has been working actively to avoid the practice, which is an ongoing problem for the wider fashion industry. She says most unsold products are donated, and only damaged items are destroyed. “Finished goods destruction is a very common industry practice, though of course that does not make it right. I can’t speak for other brands, but one of Coach’s goals has been zero destruction and that is what we’re striving for,” she says.
Coach is in the public hotseat, but it’s far from the only brand that destroys excess stock. “It’s way bigger than Coach. They’re the current company that is receiving the negative publicity, but it’s so widespread,” says Anna Sacks, the waste reduction and diversion expert whose video on Tiktok sparked the outrage.
In an industry that has only recently begun to incorporate environmental impacts into its business decisions, the practice of destroying unused products has long been a norm for brands. For luxury brands, destroying unsold products also ensures brand value is retained. It is also often cheaper, and legal in the US, to destroy excess product rather than spend resources finding ways to repurpose or recycle it. Policymakers in some countries, including France, have started trying to create frameworks for responsible management of discarded clothing and other waste streams.
Burberry faced criticism in 2018 when reports emerged that it was burning unsold inventory, and it quickly committed to not destroying any unsellable products. In truth, all brands have unsellable products to deal with, whether it’s unsold inventory, damaged goods or customer returns — and the industry has not yet created enough solutions for dealing with them effectively.
The problem has been exacerbated by an increase in product returns tied to the rise of online sales. Returned items can be tricky to resell because many businesses are not equipped with the necessary infrastructure or technological capacity — they can easily end up as discards. The overall return rate for online shopping across industries is 25 per cent, according to Optoro, a reverse logistics company that works with retailers and manufacturers to manage and resell returned and excess inventory. For fashion companies, it’s between 30 and 50 per cent.