What happens to all of those clothes retailers can't sell?

Thanks to stores like H&M, Old Navy and Forever 21 that offer mass-produced clothing at dirt-cheap prices, we are living in an age of disposable fashion. And with the constant turnover of goods at these stores, there are plenty of items that never even make it to the cash register. So what happens to all of those unwanted jeans and dresses after their last chance expires on the clearance rack?

Major retailers have a couple options when it comes to getting rid of unsellable clothes: They can either destroy them in industrial-sized shredders and/or dump them in a landfill, hire recyclers to re-purpose the clothes (which can require shredding), sell them to outlets and discount stores like T.J. Maxx, Ross and Daffy's or discount web sites like Overstock.com or Yoox.com or donate them to charities like Goodwill or the Salvation Army.

Much to the dismay of environmentalists and charities, letting unsold clothes end up in a landfill is the method of choice. By doing so, retailers and fashion designers believe they will keep unwanted merchandise from flooding the market and protect their brand by preventing their clothes from ending up on, say, a homeless person, says Luis Jimenez, the executive director of the New York Clothing Bank, an organization founded by Mayor Koch 25 years ago to encourage retailers to donate unsold merchandise instead of trashing it.

"We're actually working with the City Council here in New York to reach out to more retailers, to make them understand that [donating clothes] is not only good business sense as a tax write-off, it helps them be a good corporate citizen," he says. As stores bring in less merchandise because of the recession, the Clothing Bank has seen a drop in donations. Among the more generous suppliers of donated clothes are Macy's and Brooklyn Industries, he says. The Gap used to provide their unsold clothes but stopped, says Jimenez.

Beyond charitable organizations, there are for-profit companies that have found that unwanted clothes can be big business, whether it's selling clothes to the developing world, re-purposing and reselling them to U.S. consumers or hauling them off to the landfills.

Trans-America, a for-profit textile recycling business, receives damaged clothes from charitable organizations like the Salvation Army and Goodwill and sells them to developing countries or turns them into rags. Businesses like his process 2.5 billion pounds of clothes a year. Stubin's alone processes 16 million pounds annually, reselling 40% of it in developing countries across five continents, for 25- to 50-cents a pound. Another 35% of his business's take of unwanted clothes is turned into material for the wiper industry (rags for industrial use or sold in home maintenance stores) and 20% turns into, for instance, fiber for insulation, auto sound dampening, or carpet padding.

"You see so many people interested in sustainability and recycling. Post-consumer textile waste and apparel, typically, is not included in that discussion," says Eric Stubin, Trans-America'sfounder and a member of Bel Air, Md.-based textiles-recycling interest group, Secondary Materials and Recycled Textiles (SMART). According to a 2009 SMART report, the amount of textiles being dumped is increasing, with 84% of the 11.9 million tons of unwanted clothing a year ending up in landfills. In Europe, textile-recycling is mandated by law.

New Jersey-based TerraCycle, founded by Princeton dropout Tom Szaky, sponsors donation boxes at Macy's in their state, asking for people's used jeans and sneakers so they can re-purpose them into messenger bags, laptop sleeves, and high-end items. TerraCycle already makes bags out of plastic juice and yogurt containers. Some of the recycle-made items include a backpack made out of empty Capri Sun pouches for $12.99, a messenger bag made of used Lay's Brand wrappers that retails for $14.99, and a children's lunchbox made out of Kool-Aid wrappers that sells for $7.99.

Even with all of these options, many retailers continue to be leery about recycling. Last January, a graduate student in New York, Cynthia Magnus, found bags of unsold clothing behind an H&M, that had been ripped apart by store employees. She reported her findings to the New York Times, which spurred the retailer to change its policy and donate its unsold merchandise to charities.

Other companies are proactively encouraging customers to recycle their clothing once they are done with them. Levi's, a fixture in thrift and vintage stores, has added a tag to a line of jeans encouraging consumers to recycle them and has set up a website where people can find their nearest Goodwill.

So next time you say goodbye to a piece of clothing that you once loved or purchased against your better judgment, know that there is still life left in it, and an entire industry tasked to find it.
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