Otrium and Vaayu have partnered to publish a comprehensive analysis of the avoided carbon emissions and waste of modern off-price business models. Using these science-backed insights, fashion retailers will be able to harness generative AI and machine learning technology to calculate emissions in real-time, and then lower them.
Vaayu has used its proprietary AI and machine learning technology, alongside its team of in-house Life Cycle Assessment experts, to gather insights from over 45 fashion brands (both available on and off Otrium) and data from almost five million fashion products live on Otrium to calculate carbon at a granular science-based level.
“In 2015, we founded Otrium to play a part in reshaping how fashion is produced and ultimately sold,” says co-founder Max Klijnstra. “Our business model is a first step in solving the growing challenge of unsold inventory. As a next step, the results from our Otrium 2022 Impact Report will inform and strengthen our sustainability strategy and climate targets. We will also use it to transparently communicate our progress with our community, brand partners and the fashion industry. At Otrium, we will be working steadily towards improving our impact one step at a time.”
The research explores the broader role that modern outlet business models like Otrium can play in enabling a more circular fashion industry by providing an alternative to waste streams for unsold stock. It represents a new contribution to understanding the end-of-life phase of fashion products as one of the largest data sets on unsold stock practices.
In 2022, based on these calculations, Otrium says it prevented 6,496 tonnes of carbon emissions (CO₂e) and 104 tonnes of waste by providing fashion brands with a profitable solution to clear unsold inventory, compared to an alternative scenario in which off-price businesses like Otrium do not exist. That’s the equivalent of 2,219 round-trip flights between Amsterdam to NYC for one passenger or throwing away 130,524 pairs of jeans.
Otrium partners with over 400 fashion brands like Filippa K, Mara Hoffman, Everlane, Outerknown and Closed to reach new consumers for every item of clothing produced and extend the life of their collections. Now, with the help of Vaayu, Otrium has access to live carbon tracking at a product and brand level, enabling the business to monitor across transactions and use this data to drive real-time decision-making around impact.
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Envisioning a future where all clothing produced is worn and no new clothing ends up in landfills, Otrium says it aims to empower its brand partners to take a more demand-focused approach to production and innovative ways to reach new consumers. Through data-sharing and customer insights, Otrium encourages more accurate forecasting.
To support its five million members globally in making informed choices outside trend and seasonal models, Otrium is working with sustainable and ethical brand rating organisation Good On You, which benchmarks the brands on Otrium based on its social and environmental impact. Otrium also revalues damaged items like returns, repairs them and feeds them back into the cycle.
Marlot Kiveron, head of sustainability at Otrium, explains: “Our ultimate goal is to have a net positive impact. This means giving back more than we take through our business model, and operations. Creating impact is constant. The goal of this report is to measure our progress and to stay accountable by sharing this externally. Understanding the impact of both our business model as well as our operations in real-time, helps us to accelerate positive change.”
Namrata Sandhu, co-founder and CEO of Vaayu, adds: “We’re at an inflection point when it comes to the climate and new research shows that we’re currently not on track to keep global warming below 1.5C. Retailers have long been transitioning reactively; thinking about systems change and circularity, and wanting to truly understand and lower their impact. But Vaayu actually enables them to work proactively, by harnessing our generative AI and machine learning technology to calculate emissions in real-time, and then lowering them using these science-backed insights. Our work with Otrium is the first of its kind to investigate the carbon emission and waste-saving potential of off-price business models.”