Just the other day, a ban on burning and destroying unsold clothing and footwear came into effect in the European Union. It would seem like a victory for ecology and common sense. However, amidst loud political statements, information concerning the most untouchable segment – high luxury – went largely unnoticed. This news was about the ongoing lawsuit against former employees of a Chanel warehouse in Hong Kong. They are accused of attempting to steal 724 bags and leather goods. It might seem like a typical theft, but it was this trial that lifted the veil on the disposal scheme for unsold goods.
It turned out that the items the employees tried to take from the warehouse had already been designated for "shredding." As revealed during the court sessions, Chanel regularly destroys up to 20,000 unsold items every six months. Bags that customers pay thousands of dollars for are simply sent to the shredder. The theft itself occurred back in 2017, but the full trial, exposing the scale of such "disposal," has only just begun, almost 10 years later.
Why do fashion houses burn and cut up excess stock? The answer is simple and quite cynical: to protect the brand's expensive reputation. Burning or shredding is cheaper than holding sales. Luxury brands absolutely cannot afford to discount items in sales – it would kill the aura of exclusivity. By destroying excess, brands artificially maintain a perception of scarcity and keep prices sky-high. It's easier to burn a batch of bags than to allow them to fall into the hands of the "wrong" buyers at a reduced price.
Currently, the European Union is actively cracking down on Chinese retailers like Shein and Temu. Under the pretty slogan "fast fashion is evil," new duties and checks are being introduced. But if you look closely, luxury brands are also not without sin, and their transgressions are far more significant.
European officials are targeting the wallets of Asian online platforms but prefer to overlook, for example, who actually sews the "Italian luxury." Investigations in recent years have repeatedly proven that behind the "Made in Italy" labels lies genuine slave labor. In the same Italian regions (like Prato), people of Asian origin work in inhuman conditions, in basement workshops, earning pennies for sewing clothes that will later be displayed in Milan and Paris boutiques for hundreds and thousands of euros. But European regulators seem to ignore this "dirty side" of luxury, preferring to fight windmills in the form of cheap Chinese hoodies.
It would seem that with the new ban, justice has been restored, and high-luxury brands will also be forced to think about reasonable production. But practice shows that not everything is so simple.
Let's recall France, which adopted a similar law six years ago, in 2020, prohibiting the destruction of unsold non-food goods. What happened in reality? Brands found an excellent loophole.
Why burn things if they can be "donated"? Fashion houses began massively offloading old, unsellable, or out-of-trend collections to charitable organizations. In return, they receive huge tax deductions from the state. It would seem everyone wins. But last year, the truth came out: NGOs were simply overflowing with mountains of unwanted clothing.
Charitable warehouses are bursting with items that cannot be distributed. This means fashion houses have simply shifted the problem onto others' shoulders. They haven't reduced overproduction; they've just changed the disposal method: instead of bonfires, there are overflowing dumpsters and warehouses of charitable foundations that don't know what to do with this "gift."
