Damien Meyer/Getty ImagesBurn it, slash it, bury it – this is what clothing brands have been doing for years with their unsold stock. But in the European Union, this is now changing. New rules banning the destruction of unsold garments have come into force. These mean brands must find alternative pathways for their unsold stock such as resale and donation. They must also declare on their websites their volumes of unsold stock. Destruction of garments will only be permitted for items that are damaged or unsafe.These rules come under 2024 regulations, which are designed so that clothing sold in the EU will be more durable, reusable and recyclable. At first, the new rules apply to large retailers, but from 2030, they will apply to medium-sized retailers too.Here in Australia, we don’t have reliable estimates of the size of the problem, but we could learn from the EU model.So how big is the problem of unsold stock?Also known as “surplus”, “deadstock”, or “excess inventory”, unsold stock includes clothing that has been produced but never sold to a consumer, as well as clothing that has been returned by a customer.The size of the problem is difficult to quantify as there has been no requirement to declare unsold stock. A meta-analysis of multiple studies from Europe calculated the average share of unsold stock is 21% of all clothing placed on the market. While some of this unsold stock is redistributed to charities, the EU estimates 4%-9% of all new clothing is destroyed.This percentage may be even higher for online retailers, as retail returns alone are estimated to range from 10% to as high as 60% for some categories of clothing. This is due to practices such as consumers buying multiple sizes of one garment (known as “bracketing”) and then returning the ones that do not fit.From fast-tracked to forgottenFast fashion has made the problem of unsold clothing far worse by constantly releasing new collections and styles. In 2022, H&M released 4,400 new styles across the year, and Zara 6,850 new styles.Ultra-fast fashion accelerated this turnover even more, with Shein adding up to 10,000 new designs on peak days, according to Greenpeace. This means thousands of clothes remain unsold. And this is not limited to fast fashion; luxury brand Burberry destroyed £90 million (A$170 million) worth of products over five years. In Australia, we do not know the volume of unsold stock, but it is possible to estimate it using the EU percentages.In 2024, Australia imported 1.55 billion units of clothing into the country. This figure only includes large shipments to retailers, not individual purchases by consumers or smaller restocking by brands.One industry estimate suggests at least 3% of all clothing imported into Australia remains unsold, equivalent to 47 million units or 11,700 tonnes. It is unknown how much of this would be destroyed.However, applying European estimates to the Australian market would produce a less optimistic picture. If the European estimates apply, with 4-9% of unsold clothing destroyed annually, then this would equate to 62-132 million units of clothing destroyed each year in Australia, or 15,500-33,000 tonnes. Whatever the precise figure is, we know there are tens of thousands of tonnes of unsold stock in Australia. This represents a colossal waste of the materials, energy and labour that went into making and shipping them.What can be done about it?There are local solutions to avoid the destruction of new clothing. Australian company Thread Together works with 2,000 Australian brands to distribute unsold clothing to people in need.Seamless, an Australian scheme to encourage a circular clothing economy by diverting clothing from landfill, has made several recommendations: establish a shared definition of unsold stockmap where and why it accumulates across planning, production, retail and post-season stagesand provide practical tools to calculate its true business cost.These measures would improve forecasting and collaboration, helping brands deal with excess stock before it must be discounted, donated or discarded.Efficiencies can be made through better inventory management and resisting constant style changes. A recent industry report highlighted that efficiencies are possible. Uniqlo increased its profits by 70% over seven years while resisting constant trend turnover, producing only two collections annually and maintaining a relatively limited range. Half the range is carried over from the previous season.The bottom lineIn today’s fashion system, surplus is a feature, not a bug. Fashion brands are locked into unsustainable practices.The EU laws are a step towards holding brands accountable for the resources they use and waste – and because the rules apply to everyone, everyone must work together to change how the overall system works. Here in Australia, we also need a level playing field, as no one fashion brand can change their practices alone. The Australian government has an opportunity to strengthen the rules on “product stewardship” – where businesses take responsibility for a product across its entire lifecycle – and encourage retailers to keep new, unsold clothing out of landfill.Alice Payne receives funding from Australian Research Council and Cotton Research and Development Corporation. Alice was part of the consortium that designed the National Clothing Product Stewardship Scheme that became Seamless.Yassie Samie receives funding from Australian Research Council .