CLOSED LOOP SUPPLY CHAIN: IMPLEMENTING CIRCULAR ECONOMY PRINCIPLES IN THE FASHION INDUSTRY

Abstract

This study examined the effect of closed loop supply chain on circular economy implementation in the fashion industry. Closed loop supply chain was measured using reuse and recycling, while circular economy implementation was assessed as a single composite variable. A descriptive survey research design was adopted for the study. The population comprised supply chain managers, sustainability officers and marketing managers of selected fashion firms, from which 214 respondents were drawn. Primary data were collected through a structured questionnaire, while the formulated hypotheses were tested using multiple regression analysis with the aid of Statistical Package for the Social Sciences (SPSS) version 27 at a 0.05 level of significance. The findings revealed that reuse had a significant positive effect on circular economy implementation (β = 0.413, p < 0.05). Similarly, recycling was found to have a significant positive effect on circular economy implementation (β = 0.371, p < 0.05). The model explained 54.3% of the variation in circular economy implementation (Adjusted R² = 0.543). Based on these findings, all the null hypotheses were rejected. The study concluded that effective closed loop supply chain practices significantly enhance circular economy implementation, with reuse and recycling jointly contributing to a more circular fashion industry. The study therefore recommended that management of fashion firms should strengthen product reuse, take-back and recycling systems as part of their supply chain practices, in order to reduce textile waste, retain product and material value and support a more circular fashion system.