EU Ecodesign regulation on unsold clothing: limited data on what happens to surplus garments

When the EU moves to ban the destruction of unsold clothing under the Ecodesign regulation, the logic appears straightforward: products that have not been sold should not become waste before they have even been used. But what actually happens to fashion’s surplus garments within the industry remains far less clear.

A commonly cited figure is that around 20 percent of garments go unsold. But this does not mean that one in five items is never used. It refers to products that fail to sell in their initial retail cycle, including returns, and are then redistributed through channels such as markdowns, outlets and off-price sales. Most eventually find a buyer.

What remains is a much smaller, but more consequential share: garments that fail to find a market at all. This fraction, according to EU estimates, represents roughly 4–9 percent of all textiles placed on the European market, equivalent to approximately 264,000 to 594,000 tonnes per year.

It is this residual stream of unsold clothing that is now being targeted by regulation.

Limited data on the residual stream of unsold clothing

The problem is that there is no clear picture of what this residual stream consists of, or how it is handled in practice. While resale channels such as outlets and discount platforms are relatively well understood, the final stages of the process remain opaque. What happens to garments that cannot be sold, even at a discount, is not systematically documented.

This lack of transparency is structural. Until now, companies have not been required to disclose how they manage unsold products that are ultimately discarded as waste. EU estimates are therefore based on partial data and industry assumptions rather than comprehensive reporting.

Approximately 264,000 to 594,000 tonnes of unsold clothes effectively disappear every year through destruction.

Ecodesign regulation introduces reporting requirements for unsold textiles

The Ecodesign regulation changes this. Companies will be required to report how they handle unsold clothing and footwear, including the volumes discarded and the reasons why. For the first time, policymakers and the public may gain insight into a part of the system that has largely remained out of view.

The EU’s stated objective is to reduce waste and emissions. Fewer new garments should be destroyed before use. But the regulation also alters the cost structure of overproduction.

If unsold goods can no longer be disposed of, the cost of forecasting demand incorrectly increases. In theory, this could lead to tighter production volumes, improved demand planning and more cautious inventory management.

In practice, the outcome remains uncertain.

Structural constraints in the fashion system limit immediate effects

The fashion industry is structurally built on volume, speed and availability. Producing less carries risks in the form of missed sales, while producing more has historically been manageable through markdowns, secondary channels and, in some cases, destruction.

Without that final option, companies will need to identify alternative pathways for managing surplus. These may include deeper discounting, expanded outlet channels, extended storage or new forms of redistribution.

A key question is whether part of this volume will move into second-hand markets. On the surface, this appears plausible. Unsold garments are intact, unused and often of higher quality than much of what is collected post-consumer. In a global context, where European fashion cycles are less relevant, they may retain resale value.

But this is not only a question of product quality. It is also a question of system capacity.

Second-hand and recycling systems face capacity and value constraints

Across Europe, infrastructure for handling used textiles is already under pressure. Collection volumes are increasing, while margins in sorting and resale are declining. Even if unsold garments have resale value, it is unclear whether existing systems can absorb additional volumes at scale.

At the same time, one of the long-term solutions highlighted in policy discussions, fibre-to-fibre recycling at scale, remains limited. Most textile recycling today results in lower-value outputs, and fully circular systems are still in development.

This leaves a limited set of practical pathways for managing surplus: resale, redistribution, downcycling or waste.

With destruction now restricted under the Ecodesign regulation, one of these pathways is being removed.

The regulation is clear about what should not happen. Less clear is what should happen instead.

Until there is better data on how unsold clothing is currently handled, it remains difficult to assess how the system will respond when one of its final exit routes is removed.