Charities Turn to Global Textile Market to Raise Cash

About 10 pounds per person, per year - thanks to an upward trend in used clothes and shoe donations, that's the amount of clothing, shoes, and other textiles U.S. consumers typically recycle. Together, households and businesses help divert approximately 2.5 billion pounds of excess textiles from entering the solid waste stream every year.

As donations increase so do the number of organizations that collect clothing, shoes, and other textile-based items. New collection bins, each touting a different charity orcause, continue to appear. Neighborhood clothing drives take place every weekend and many schools now encourage students to donate out-grown shoes as part of their "green" campaigns. Yet, even when combining the efforts of all non-profits, businesses, recycling centers, thrift stores, and church groups, only 15 percent of textiles are recycled. The remaining 85 percent is still thrown away. That's about 60 pounds of textile waste per person.

Growing Enterprise

As textile recycling gains momentum, a few misperceptions keep circulating about the industry and are perpetuated among news media, blogs, neighborhood groups, and other forums. In particular, there seems to be a loud outcry over the sale of donated clothing to third parties.Browse the Internet and you'll find individuals who "are shocked" to learn their used designer jeans are being sold to a recycling business. Or that not every pair of their "gently worn" Nikes is given to inner city teens, but instead, some will protect the feet of subsistence farmers in Angola. Some find it "morally outrageous" that donated clothing is being bartered and sold like a regular commodity for pennies on the pound.Whether we care to know or not, the used garment trade is a multi-billion dollar enterprise. As a U.S. export commodity it ranks among the top ten, employs between 20-30,000 U.S. workers by some estimates, and generates several hundred thousand direct and peripheral jobs worldwide. In lesser-developed countries used textiles are vital source of income for one-person shops and small business.

Our Surplus Fills Demand Abroad

Within the global textile market, it's no secret that the majority of national and local aid organizations (Goodwill, Salvation Army, and your neighborhood charity) wind up selling a significant portion of what they collect to third-party recyclers. Why? They simply can't sell or give away the volume they collect every day. After clothing is sorted, the best goods may go to thrift stores or other second-hand outlets. The bulk, about 60 percent, goes to domestic and overseas recyclers who supply poorer nations with much needed low-cost clothing.Some is repurposed to manufacture everything from sound proofing insulation to new car upholstery, and of course more new clothes.

Drowning in Clothes

As new clothes purchases increase so does the output of used clothing. In the U.S., we can't begin to absorb the huge tide of discarded textiles and garments. Today, we bury or incinerate most of it, recycle a small amount domestically, and sell the rest overseas, where there is a continuing demand.When natural disasters strike and relief organizations like the Red Cross request aid, clothing is purposely not at the top of the list. Yet, it still arrives by the semi-truck load, and they too need to sell it. And it makes perfect sense. Nonprofits need multiple revenue streams to survive and to conduct their individual missions. Fundraising requires a constant and multi-level effort - ranging from expensive direct mail campaigns to bake sales. By selling donated clothing, organizations can raise much needed cash to fund programs, pay expenses, house their operations, and much more.

No Free Lunch

And it's not just clothing, nonprofits are collecting all sorts of donated items - cell phones, ink cartridges, and electronics - for their cash value. It takes cash - lots of it - to fund a national charity collection effort. When a garment is given free to a charity, it doesn't mean it's free for the charity to collect it. For those with large collection programs, this may mean buying and maintaining thousands of collection bins or operating storefronts, paying drivers, leasing trucks, hiring sorters and packers, buying mechanical balers, paying freight and transportation,etc. It's no wonder then, that a nationwide charity may spend $10 million to make $16 million and put the net proceeds toward its mission. The adage, "It takes money to make money" applies to charities just as it does for profit-driven firms. The cost of doing business is similar as well. Essentially many of the costs to run a large for-profit business also are required of a large nonprofit. (Except that nonprofits have to do it on a shoestring budget, otherwise they get criticized for too much overhead, but that's another story.)

A Slice of "Clothes Pie"

Given these economic realities and the known environmental benefits of recycling, it's perplexing why some charities are chastised for selling donated garments and shoes. Put another way, would a needy individual who receives two coats be admonished for selling one of the coats to buy another basic necessity? Many established and well known charities have been selling clothes for years, and on a large scale. The point is this - even if we quadruple our textile recycling efforts today, a large excess will still get tossed in the garbage tomorrow. The "used clothing pie" is large enough for nonprofit agencies and recyclers to claim a slice, with plenty left over. As long as charitable organizations are transparent about their intentions, they should be able to trade their donations on the global market.

Charity or Charlatan?

As we increase our collective recycling I.Q., we also need to increase our knowledge about the organizations doing the collecting. While the majority of clothes recycling operations are legitimate, there are a growing number that are not. Clothes collectors may be registered charities,others may be strictly for-profit, and some are intentionally vague about their operations. The latter may be simply false fronts eager to cash in on the public's generosity by slapping a generic charitable cause on a donation box. These rogue operators routinely place their bins on private or public property,without any intention of seeking permission or following city ordinances. Once they are discovered or questioned, they just move to another location.

Transparency is Revealing

The unfortunate result has been a small but growing distrust of the clothes collection process in general. Firms that legitimately gather clothing through donations and contribute to domestic or international aid programs find themselves defending their reputation and practices. In any industry, there will always be those that operate under false pretenses or willing to dupe the public with less than transparent motives. But to protect the growing recycling movement, we should insist on open disclosure, verifiable credentials, and a responsible and documented donation history. Some progress has been made in this area by the recycling industry, but clearly more can be done to expose fraudulent operators.

"Triple-Win"Business Model

Despite some of these issues, collecting clothing for charitable purposes is and always should be a win-win-win situation - for the giver, the charity, and the receiver. The donor gives something he no longer needs, the charity finds a need, and the recipient has a need filled. It's a pretty effective business model when youstop and think about it. Whether therecipient gets an actual piece of clothing or receives assistance through an international aid program funded by recycling dollars, the benefit reaches the intended target. Moreover, the impoverished have other basic needs that need attention - access to food, water, housing, education,and ways to improve health and raise their living standard. Sales of used clothing generate the funds necessary to establish and maintain such programs.

Environmental Benefits

So let's continue to clean out our closets, tote our groceries home in reusable bags, and sort our garbage in the right bins. We all need to take care of our planet and we need to take care of each other. Let's give our used garments to clothe others or convert them to cash to fund programs for the less fortunate. And help protect our planet at the same time. It's only a win-win-win if you participate and we let charities do what they do best.

~ Ruben V.