In the past month, global fashion brands have been scrambling to make sense of President Donald Trump’s ‘Liberation Day’ tariffs. Production and material costs quickly spiked for independent brands, suppliers in established garment manufacturing countries saw orders paused or cancelled, and share prices slumped across the industry.
As fashion reeled over rising prices, many looked to resale as a potential safe space from tariffs, because it leverages stock that is already domesticated. Could circular fashion — from secondhand shopping to recycled textiles — be insulated from the incoming turmoil?
On some sites, increases in searches indicate that tariffs are creating new converts to resale. On Depop, searches for international brands, which might be subject to tariffs if imported new, are among those rising. US brands that have their own resale channels are reporting an uptick. “One positive note to share is that our resale business, Renew, is not touched directly by tariffs and is poised for continued growth in the upcoming year,” Eileen Fisher CEO Lisa Williams said over email. “We continue to develop and better integrate our resale platform into our overall business and are pleased with our work in that arena.”
Circular fashion proponents believe that the pressure on the bottom line could push more brands to embrace business models such as resale and rental to extract value from existing inventory. “In the US, tariffs basically make resale a much more compelling value proposition versus traditional retail,” says Alon Rotem, chief strategy officer of resale platform Thredup. “That means buying resale items will be comparatively less expensive than brand-new items,” he adds — even more so than before, as the prices of new items are expected to rise.
Plagued with chronic outsourcing, climbing emissions and colossal waste, the US clothing industry has, for many years, been in need of a reckoning. “This is bringing awareness to some supply chain issues that might not otherwise have come front and centre for businesses. And so if any good can come out of these challenges, I believe it is the opportunity to reuse what you’ve got,” says Stephanie Benedetto, CEO and founder of Aloqia, an inventory management software company that helps brands identify internal opportunities for circularity.
But circular fashion, as it turns out, is far from immune. The tariffs impact everything from the technology needed to power e-commerce platforms to the consumer confidence needed to power a sale, so independent sellers and large brands alike are enduring blows to their bottom lines. Ongoing economic volatility is also straining efforts to scale the budding textile recycling industry. With a linchpin in shipments and cross-border commerce, some independent vintage sellers and large-scale textile recyclers are feeling the impacts of stalled shipments and increased import costs. “Many resale platforms still depend on imported products for resale, along with packaging, tech hardware and logistics systems,” says Rachel Kibbe, founder and CEO of American Circular Textiles.
Softer spending can also drag sales across the board. Williams says that considering the “challenging environment”, neither resale nor the label’s main line is “growing at a robust rate”. Rotem adds: “If people have less money to spend, that will be challenging for all of retail.” And when the economy downturns, brands are more likely to pull back on investing in areas like recycling. So where does that leave circular fashion in the new tariff era?
Uncertainty stalls sales
As a reseller specialising in vintage designer and eveningwear, Los Angeles-based Tab Vintage sources roughly two-thirds of its garments from Europe. Its founder, Alexis Novak, says the uncertainty around import tariffs has thrown a wrench into receiving shipments, especially larger or bulk purchases from European auction houses.
“These tariffs could completely price us out of being able to import pieces from the European Union,” says Novak. “It’s crucial to have access to the global market; it’s so much different than just having the US market for secondhand, especially because most of these pieces are outside of the States.”
There is uncertainty in both directions. For independent resellers operating outside of the US but selling into it, the tariffs have dampened sales and in some cases created additional costs that are drowning their bottom lines.
Kaelen Haworth, founder of Toronto-based vintage store Absolutely Fabrics, says roughly half of her online sales come from the US. Since the implementation of the tariffs, however, what was once steady growth in the American market, has plateaued. But the biggest tariffs-related blow thus far, Haworth says, is the palpable uncertainty on the consumer’s end.
“We’re seeing people either hesitant to buy from us from the US, which is one of our biggest markets, or they’re refusing a shipment when it gets to them because the duties and taxes are too high and not realising that it comes back to us to pay,” she explains. “So not only do we lose the sale, but then we have to pay 25 per cent or whatever the tariff cost is — we end up paying to lose a sale.”
Trump’s ‘Liberation Day’ tariffs will be a blow to consumers and brands. Uncertainty — and anxiety — is at a high.
Haworth estimates that Absolutely Fabrics has coughed up some CA $2,000 (US $1,450) on refused shipments this month alone. “It feels like a pretty massive hit to us because we’re a small business,” she says.
Rising costs and waning confidence
Textile recycling, an already nascent industry, could face additional setbacks. “Textile recyclers and manufacturers rely on machinery we don’t make in the US, so while resale might dodge the initial blow, the broader circular economy still lives downstream of global trade systems,” says Kibbe. With increased duties on the technology necessary to build up the US’s textile recycling infrastructure, some fear slowed progress, as the tariffs could impact prices and the availability of specialised equipment typically sourced from overseas manufacturers.
“On the recycling side, we don’t manufacture the machinery needed for feedstock capture or chemical recycling here in the US. We’re trying to build a domestic system using foreign tech — and now that tech just got more expensive,” says Kibbe.
US-based textile recyclers are concerned about how Trump’s tariffs could diminish momentum in the still burgeoning industry. Uneasiness in the market can turn investors and clients cold, leaving recyclers little capital to operate and scale with.
Industry leaders say tariffs alone won’t boost domestic industries — they need positive incentives and infrastructure, too. “The circular fashion transition relies on long-term offtake commitments, industrial-scale infrastructure and policy stability. Right now, that volatility risks driving the opposite,” says Peter Majeranowski, president of textile recycling company Circ. “We’ve intentionally designed our model to be resilient to this kind of volatility by making it strategically global, energy secure and less exposed to short-term trade shocks. But to build a circular economy for fashion at scale, we need more than trade policy. We need real investment in textile recycling infrastructure and a clear industrial strategy that rewards long-term innovation, not just penalises the status quo.”
Majeranowski says that Europe is a great example of the conditions needed to scale circular economy technologies, including the region’s implementation of regulatory frameworks, defined recycling targets and carbon reduction goals. He also points to momentum in Asia, where lower construction costs and a push to transition to advanced technologies are accelerating adoption; the administration’s tariffs scheme is projected to generate roughly $5 billion over 10 years. Officials have not yet indicated how or where the import duties will be reinvested into the economy.
“Tariffs can be a tool to rebalance things. But if they’re not paired with actual reinvestment — especially into domestic manufacturing and circular infrastructure — it’s just more cost without vision,” says Kibbe. “And the truth is, so far we haven’t seen a serious plan for reinvestment move forward in a meaningful way and that’s where we see our biggest opportunity for continued advocacy. Without infrastructure, we’re building a future on quicksand.”
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