Give H&M Your Old Clothes, Get a Discount

Hennes & Mauritz, whose 2,900 H&M clothing stores have helped make it Europe’s No. 2 fashion apparel chain, suffered a public-relations black eye in 2010 when some of its unsold inventory was shredded and left for trash on a New York City street. These days, H&M executives figure they’ve found a way to use clothing waste to burnish the retailer’s reputation. A program started in February encourages consumers to recycle their castoff garments by offering discounts on yet more clothing purchased at its stores. It will be rolled out at all H&M stores by year-end and could attract shoppers as the chain struggles to increase revenue.

By potentially alleviating tight cotton supplies and reducing the piles of old garments choking landfills, the recycling push may also bolster the company’s image in the wake of factory safety incidents in Bangladesh, where H&M produces garments. “This is a good thing for getting people into their stores,” says Bryan Roberts, an analyst at researcher Kantar Retail. “It’s often the case that green initiatives go hand in hand with commercial objectives.”