The best time to tackle unsold goods is before they exist

In fashion, circularity begins to take shape when decisions are made about what to produce, in what quantities, with which materials, and based on what information, explains the Circular Fashion Manifesto 2026, developed by the Monitor for Circular Fashion (M4CF) at SDA Bocconi School of Management. Finding better ways to manage unsold goods is a matter of regulatory compliance but preventing these items from accumulating in the first place is the best solution for businesses and for the environment.

Action is needed across the entire system connecting design departments, suppliers, manufacturers, brands, distributors, platforms, and consumers—because unsold goods are the result of fragmented decisions, incomplete information, and responsibilities that are often distributed in a less-than-optimal way. The Manifesto translates this idea into a framework, an operational model consisting of 28 strategies associated with the different stages of the value chain and accompanied by indicators for measuring implementation.

Why do fashion companies end up with unsold goods?

The research comes at a time of profound regulatory and industrial transformation. For the fashion industry, the European Commission is introducing new ecodesign requirements, the Digital Product Passport, restrictions on the destruction of unsold products, and extended producer responsibility for textile waste management.

The priority in all this is handling unsold products, which necessitates a transformation in the fashion industry centering around a system for managing surpluses – or better still, avoiding them altogether. We are already well-aware of many possible solutions: improving forecasting, shifting to production based on planned orders, reselling stock, repairing, donating, reusing, or recycling. The Manifesto adds a comprehensive overview of the reasons for unsold goods, responsibilities along the supply chain, and the tools needed to assess results.

The problem also extends to unused fabrics and components, defective or returned products, materials that could be recovered, and items that fail to find a commercial outlet despite retaining economic and functional value.

The research therefore addresses four closely interconnected questions:

• Which elements of the current system generate or multiply unsold goods?
• Which innovations can support the transition to a more efficient system?
• How should a supply chain systematically prevent surpluses and maximize the value of unavoidable ones?
• Which practices and indicators can turn circularity from a statement of principle into a management process?

28 strategies for a framework

The work was developed at M4CF, the research observatory that is part of SDA Bocconi’s Sustainability Lab, bringing together fashion companies from both upstream and downstream segments of the supply chain, along with providers of technologies to achieve circularity in the industry. In April 2026, the Monitor and CNA Federmoda applied the Three Horizons method to the issue of unsold goods, a scenario-planning tool that connects the current system, innovations already underway, and a desirable future. This collaborative research effort systematizes the knowledge developed by companies and supply chain specialists, also drawing on projects developed by the Monitor.

In the first five years, from 2020 to 2025, M4CF supported 20 circular innovation projects. In 2025/2026, it also took part in consultations on studies by the European Joint Research Centre concerning ecodesign and the content of the Digital Product Passport.

The analysis pinpoints the critical issues in the current situation, envisions preferable future scenarios, and identifies a number of transformative innovations capable of bringing us closer to those futures. Today, what makes handling unsold goods difficult is insufficient data, limited collaboration, fragmented responsibilities, and low consumer trust. Manufacturing and digital technologies, resource sharing, training, and awareness-raising can support the transition toward a supply chain that produces based on demand, extends product lifespans, and shares responsibilities and verifiable information.

The framework proposes 28 strategies spanning the entire lifecycle of unsold goods: avoiding surpluses through better design and planning; maximizing their value through resale, repair, reuse, donation, and rental; and, finally, measuring results and raising awareness among businesses and consumers. Each group of actions is linked to specific indicators.

The cases examined show that some solutions are already feasible. Among the results achieved so far, a project with YKK has made unused zippers and buttons available on Deda Stealth’s B/Samply B2B platform, giving educational institutions, nonprofit organizations, and fashion associations access to these materials. Save The Duck transferred approximately 2,000 defective garments that could not be sold, repaired, or donated to Redesign the Planet, which added value to them through artisanal techniques, transforming them into one-of-a-kind pieces. Vitale Barberis Canonico eliminates textile waste primarily by recovering and repairing its own fabrics and, where necessary, directing unsold inventory and nonmarketable products to wholesalers, schools, associations, and social organizations. The Oscalito 1936 x Canto Primo project transforms unsold archival garments into a limited-edition women’s capsule collection.

Francesca Romana Rinaldi, Circular Fashion Manifesto 2026 – Guidelines on ecodesign and unsold goods management.

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