Circular Economy*

Our Challenge

Today, most of the world works on a traditional ‘linear economy’ model, which means that raw materials and energy are used to make a product which is thrown away after use.

We want to change how we work so that where possible, we can keep materials in ‘circulation’ instead of in landfill. This means reducing the need for new raw (natural) material inputs, preventing waste and reducing energy use by making products and materials more efficiently and reusing them.

This is going to be a transformative journey over many years for Target and, as a high-volume retailer, we recognise that we have much work to do. In the past financial year, for example, Target produced approximately 78 million units of clothing*.

However, limited clothing sortation and recycling infrastructure currently presents a major roadblock to reducing clothing waste.

Our Approach

Our success will rely on changing the way we work: from design, to sourcing products; and working with others across our supply chain, as well as government and industry, to achieve system-wide change. Examples of how we are approaching this in our business today include:

  • Improving the quality and durability of products.
  • Designing our products and packaging for reuse, recycling, or responsible disposal.
  • Increasing our use of recycled materials in products.
  • Transitioning priority single-use plastic items to reusable alternatives.
  • Working with suppliers to implement new systems for capturing and reusing post-production textile waste.
  • Identifying and avoiding problematic materials that cannot be recycled.
  • Working with relevant State and Federal Governments and industry on priority product stewardship schemes.
  • Supporting research and innovation partnerships aimed at scaling-up reuse and recycling rates.

Our Progress

Circular Fashion Partnership

In 2021, we joined the Circular Fashion Partnership - a cross-sector project led by Global Fashion Agenda, with partners Reverse Resources, the Bangladesh Garment Manufacturers and Exporters Association, and P4G. Through the collaboration of global fashion brands, textile and garment manufacturers, and recyclers, this project aims to build a successful and scalable business model for capturing and reusing textile waste. By directing post-production textile waste back into the production of new fashion products there is an opportunity to scale recycling capacity within Bangladesh and generate economic benefits from these waste streams.

As of March 2023, we have trialled the partnership in Bangladesh with 18 Target and Kmart Australia suppliers. With the support of Reverse Resources, workers in partner factories benefit from upskilling on how to effectively segregate and report on waste flows. To-date 371 workers across these 18 factories have benefited from this training. Since 2021, over 1000 tonnes of our pre-consumer waste registered by our Bangladesh factories was resold to recyclers through this partnership.

Learn more about the Circular Fashion Partnership

Circular Design

We have commenced the development of a long-term circular design strategy. A first step in this process is to improve our design, buying and sourcing teams’ understanding of circular design principles and best practice. We implemented a training pilot with our team in June 2022.

As part of our long-term strategy, we have also started to develop a baseline understanding of what proportion of our clothing is suitable for textile-to-textile recycling. Our analysis suggests approximately 20% of the fabric used in our own-brand clothing today is made from mono-materials (such as 100% cotton or 100% polyester), which are generally considered more suitable for textile-to-textile recycling.


We are also investing in research partnerships with the aim of accelerating clothing reuse and recycling rates in Australia and New Zealand over the long-term. For example:

  • We co-funded a research project with charity partner, the Salvation Army, aimed at assessing the commercial feasibility of introducing advanced sortation and decommissioning technology in Australia.
  • Kmart Group is a patron member of the Australian Fashion Council and a brand reference group member of the proposed National Clothing Product Stewardship Scheme.

*excludes footwear and accessories (e.g. hats, bags, belts etc.) and single use garments (e.g. medical items).

* Due to changing priorities linked to the pandemic and evolving government policy on product stewardship, our existing public targets in relation to reuse and recycling, and care labelling have been removed pending a review and the development of a comprehensive long-term strategy. Our circular design training pilot was also delayed 12 months due to a focus on other sustainable development priorities.