Spasibo! collects used clothes in Saint Petersburg, Russia, and distributes them to those in need or sells them to sustain its project and support other initiatives. Saint Petersburg, Russia Website
Spasibo! collects used clothes in Saint Petersburg, Russia, and distributes them to those in need or sells them to sustain its project and support other initiatives.
The textile industry is the second most polluting in the world (see here edgexpo.com/fashion-industry-waste-statistics). It is estimated that 15% of the fabric used to make clothes is wasted at the time of its manufacture. Despite this, production has doubled in recent years due to a dynamic of consumption in which the lifetime of clothing items has become half what it used to be (see here). In addition, less than 1% of discarded clothes are recycled. 70% are incinerated or end up in landfills (see here).
This situation, absurd due to the misuse of resources and profoundly unethical, considering the number of people who cannot satisfy their clothing needs while there is so much waste, has led several companies and social organizations to devise alternative models of consumption that are fairer and more ecological.
According to Spasibo!, when people no longer want items of clothing they give about 5% to their friends, donate another 5% to people in need, and discards the other 90%.
For this reason, since 2014 Spasibo! has been collecting clothing donations in 120 containers across Saint Petersburg. Its model is based on the idea of a circular economy: part of its collection is redistributed to organizations that serve people that can benefit from these clothes. Another part is recycled. But most is sold in one of its seven charity shops.
The profits are then used to ensure the operation of the organization and to support various social projects, such as Nochlezhka.
A charity store is a sustainable social system that has been operating in the UK, America, Australia and other countries for over 70 years. Since 2010, charity shops have appeared in Russia. The main task of charity shops is to turn good things, unnecessary to some, into a useful resource for others. The goals of charity shops in different countries are similar, but the schemes are different. (Spasibo!’s Website).
To ensure that its support towards other initiatives has the greatest possible impact, Spasibo! carefully reviews that the organizations it contributes to:
- Demonstrate a good reputation
- Have been in existence for at least three years
- Seek to solve problems at the root level, building an alternative reality.
For clothing donations, , and as a result of past experiences of abuse, Spasibo! not only carefully reviews applicant profiles, but it has also prepared a format with which it assesses the veracity of their need and intentions.
Another way in which Spasibo! supports other charitable organizations is by helping them sell their products or souvenirs in its stores.
Spasibo! claims to be the first organization to introduce this working model in Saint Petersburg. As its success attracted the interest of many groups that wanted to replicate it, Spasibo! devoted itself to guiding them in an attempt to scale its project. However, only 10% of the organizations survived, several with very different ethical principles to its own.
Therefore, to better capitalize its time and resources, Spasibo! decided to initiate an incubator project to support organizations interested in following its model. But this also failed: only 2% of the organizations survived.
As such, it decided to change its escalation strategy:
Firstly, it prepared online guidance materials so that organizations interested in replicating its initiative can continue taking advantage of its accumulated experience and know-how.
But most importantly, it now uses franchises as its method of escalation. To do this, it hired an expert team that has helped it systematize its model, emphasizing its original elements (differentiators) to be able to patent it. Spasibo! has also designed a five-year plan with specific objectives to develop franchises. Since similar organizations already exist in Moscow, Spasibo! will open franchises in Nizhny Nodgorov and Kazan first.
Internal organization and financial sustainability
Spasibo! is registered as a company, because in Russia the figure of social enterprise doesn’t exist. As a company it is prevented from receiving specific benefits from the government. Yet, if it were an NGO it would not financially survive or be able to support other social initiatives (which is its main objective), as charitable organizations can only obtain 30% of their resources from sales.
Yet Spasibo!’s financial sustainability model is much like that of a social enterprise. It operates as a civil organization that supports other development initiatives. This attracts its clothing donors as well as customers who share its values and trust its experience.
Yet Spasibo! has also managed to create a fashionable brand image. This attracts clients who know nothing of its social projects (which it found out about through a market study it did to its clients).
Spasibo! does not receive government aid. Fully 80% of the clothing sold in its stores comes from collection containers, which it carefully places in places protected from weather hazards to ensure their longest duration (shopping centers, offices, etc.). This clothing is repaired and sold at very competitive prices as compared with the traditional market.. Part of the profits are used to buy 20% of its merchandise: cheap clothes that Spasibo! buys in other stores and resells at a profit.
Profits are also used to cover operating and escalation expenses: its organizational development, the hiring of the team of experts to develop the franchises, the purchase of clothing donation containers, equipment for its stores, the opening of new branches, and advertising.
Spasibo! also uses public relations strategies such as attending festivals, conferences and television programs for free advertising. It attracts donors by sharing messages geared towards the common good, and customers by projecting a fashionable image.
Spasibo! allocates part of its profits to maintain its stability fund. The stability fund allows it to guarantee support for social initiatives, and cover operational expenses when needed, even if its sales have been poor. It protects Spasibo! from fluctuations in the market and donations.
As it is a company, not a charity, Spasibo! does not work with volunteers, and rather seeks to consolidate its 80 employees, including the directing board. For the same reason, it does not refuse monetary donations but it does not seek them either. It instead seeks to attract investors.
Only once has it received a donation that helped it further consolidate its financial self-sustainability: from a man who donated money to the initiative in exchange for a temporary action in the company. This money was invested in buying a recycling machine that has not only saved Spasibo! the costs of hiring recycling services from other companies, but has also helped it to generate extra income. The donation was also invested in opening new stores. When the donation money was recovered thanks to these investments, Spasibo! returned it to the donor and the latter returned his action, pleased that the organization made good use of his support.
As a company, Spasibo! must adopt a hierarchical structure, and its CEO must take legal responsibility. However, in its daily work, its board functions as a cooperative administration scheme. Ten members meet once a month to democratically distribute tasks in commissions and make decisions (such as who to donate, for example). All discussions are based on five-year plans and objectives.