Case 8: Stella Soomlais

Mari Kooskora, Estonian Business School Katri-Liis Reimann, Tallinn University

Stella Soomlais

SOCIAL ENTERPRISE CASE STUDY

Vision and Mission

The vision of the enterprise of Stella Soomlais is to be a zero-waste leather bag workshop by the end of 2020 (should be 2021) and become climate positive in 2025. “I want a person’s bag to serve them as well as possible for as long as possible and that the lifespan of the material does not end with the lifespan of the bag,” said Stella Soomlais.

Goal

At the moment the enterprise produces 2–4% material leftover. The goal is to reach zero waste in production – the enterprise is actively working on a solution to recycle leather scraps that are not used into a new material.

In 2020 they plan to do the inventory of products according to the circular economy principles, to be able to use the materials 95% in all products.

The fact that the producer of zippers today is not yet an enterprise that would take their zippers back and recycle them, therefore, there are obstacles to 100% recyclable bags related to the suppliers.

Another goal is to give up using any glue in production. Some of the products do not contain it already, and this is an additional way of reducing the environmental footprint.

The enterprise has grown 10% during the previous years but they would expect 20% growth.

Stella Soomlais is a leather designer from the younger Estonian generation. She makes leather bags and accessories with a minimalist aesthetic and creates her products keeping in mind circularity – the details can be changed with ease and the material of the used product can be used to make new accessories.

Resources

All bags are made of vegetable tanned leather. The bags combine functionality with minimalist aesthetics and are designed following a circular system which the brand calls Round 2 that they have developed in-house.

High quality materials are used in a way that the details of the product can be simply repaired or replaced. The leather can be reused for a new item, adding many life-cycles to the initial material. Therefore, there are no decorative details on the products since this enables to reuse the material to the maximum and it is easy to maintain and refresh them. The pockets and straps of the bags are screwed into place – that way, unnecessary stitching is avoided. This makes it possible to re-use a large part of the material after the bag has lived its life in the hands of the current owner.

The designs are crafted to minimise the cutting leftovers. The larger cutting leftovers are used for creating smaller accessories (purses, wristbands and keychains) and the really tiny bits and pieces gain a new life in their own workshops or are given away as charity to craft clubs. If any bag ever gets spoiled with stains that won’t come off or if its function has no use to anymore, then upon returning it, the company can give it a new life. In return a person will get credit, amount depending on the condition of the bag.

Currently the enterprise uses only cowhide of European origin, but is actively looking for options to add non-animal material to the portfolio. The raw material is from Sweden and has ecological product certification as they use local animal leftover product. They also have suppliers from Italy and Spain certified by their local leather associations.

The enterprise has financed its activities itself and not received any grant funding. They have won in 2020 responsible business index gold level award (www.csr.ee) and received €1000 as a special award from Social Enterprise Network (www.sev.ee). All the profits are reinvested in the enterprise.

The structure of the social enterprise’s costs and profits is depicted in Fig. 1.

Outputs and Outcomes Activities

All bags are made in Tallinn, Estonia in Stella Soomlais’ In 2004 Stella began to tailor unique bags for studio by their own crafters. Each of her bags has a customers with specific requests. Over the years the story to tell. Every bag has information about its origin: company has grown into a brand that produces a the date the bag was finished, crafter’s name and a collection of weekend bags, backpacks, handbags, serial number. wallets and other small accessories with a circular The design concept is visualised in the following video: design system. https://vimeo.com/182364319 Since 2015 Stella Soomlais runs as a brand whose aim is to prove that managing a leather studio in a sustainable way is possible. She started her own enterprise in 2011 after she had received a business startup grant from Estonian Unemployment Fund. In 2010 she wrote her graduation thesis about circular economy model as part of the service design topic. Then she understood that by tailor-making her products she also takes the responsibility for recycling them. She can build new products if people bring back the old ones. She conducted market research as part ‘Each of our bags has a story to tell. A story on how it is made, what materials have been used for it, who has made it and how the price of the bag is built up. of her thesis to find out what people need and what are they ready to buy. During the next three years she fulfilled the orders and collected product information. By 2015 she realised the importance of following the When purchasing a bag, we want you to make a circular economy concept so that she could create conscious choice. Therefore, we are giving our the products which could be repaired, renewed and customers as much information as possible about recycled for new items. the products. For us it’s not just about creating transparency, it’s about building a lifelong Today Stella Soomlais’ studio www.stellasoomlais.com companionship where honesty and transparency makes leather bags and accessories for women and are ingrained. men. In addition to cool and long-lasting design the company has put circular economy principles in good We take pride in the bags we make and have a great respect for the materials we use. Therefore, we Stella Soomlais, founder practice to be a pioneer in making the leather use more sustainable and responsible. High quality make sure we make use of the most of it. Our materials are used in a way that the details of the designs are crafted to minimise the cutting product can be simply repaired or replaced and the leftovers.’ material reused for a new item. All products are handcrafted and made by Stella and her artisans in Estonia. As a social enterprise all the profits are reinvested in the enterprise.

The enterprise has 10 employees and some people are working as volunteers (instead as volunteers has to be on contract base). For example, some people help in the shop during weekends. They also cooperate with a family company in Tartu to be able to increase capacity and reach export markets. That enterprise produces some small items.

In addition to selling the ready-made products the brand also offers a rental service of bags and has a little second-hand corner of their own products in the studio shop.

In 2010 Stella Soomlais had the idea of renting bags according to the pay-by-use system but at that time in Estonia this concept was far too new and therefore was not progressed. The bag rental service grew out of that idea and today people can rent bags for a weekend and might decide later if they want to buy them.

Besides their own portfolio, the enterprise also carries out workshops for groups and offers a design service for other companies and blogs about their activities and circular economy. They organise exhibitions and discussion nights where people can see themselves how the bags have been produced.

The enterprise would like to promote customer responsibility, so they educate them in workshops explaining why they use certain leather. Tanning in general has a large footprint, but good design and offering 2–3 rounds for the product could extend its lifetime. Currently the enterprise is in search of more sustainable tanning providers. The enterprise also offers the first maintenance free of charge for the customers. They also sell second-hand bags which have been brought back by clients.

Based on 2019 data, the traditional sales formed 37%, e-shop and e-mail sales 23%, business clients 17%, workshops 10%, distributors 13%.

The sales have changed in recent years as peoples’ consumption behaviour has changed. They sell to German and Finnish markets via the online shop. Previously, foreign customers used to visit the shops; today, the selling has mostly moved online.

In terms of the suppliers Stella Soomlais has chosen people who would follow her own principles and value local products, pay an equitable salary and would do things not for money but because it is better that way.

Impact

The enterprise tries to reduce the leftover materials to the largest possible extent – they aim at completely waste free production. The traditional subcontracted production processes have ca 20–25% leftover material compared with their 2–4%.

Currently they are in the process of development of new materials from the leftover materials.

They also sell their own and other Estonian producers’ textile bags made of leftover materials for the storage of the bags.

A handmade leather bag is an investment. When buying a bag one should know why it costs what it costs. To illustrate this, they provide full information on this – from direct production to overhead and markup. This is meant to help people make more conscious choices.

The company analyses its impact in terms of usage and waste of materials. They correspond to the responsible business index criteria of the Estonian Responsible Business Forum (CSR.ee). In order to analyse their activity, they compare the previous year’s achievements and set the goals for the next year.

They analyse the risk management plans regularly but work safety has not been yet dealt with thoroughly.

They also take good care of their own employees and offer them self-development training, inspiration days, and physiotherapy services. These services are provided during working hours by the enterprise and are also part of the impact measurement indicators.

The measurement indicators include production development indicators, whether the reuse services function well, indicators related to the rental service, testing new materials, and turnover. The impact is mostly measured in terms of the contribution to the circular economy.

MATERIAL 17% STUDIO 4%

ADMIN 5% PROFIT 23%

CRAFTMANSHIP 13% MARKETING 8%

Fig. 1 The structure of Stella Soomlais’ costs and profits.

2020 Circular Fashion System Commitment

At Copenhagen Fashion Summit 2017, Global Fashion Agenda called on fashion brands and retailers to sign a 2020 Circular Fashion System Commitment to accelerate the transition to a circular fashion system.

Circular economy is an environmentally considerate way of conducting business. In all stages of production the environmental consequences and sparing aspects of the resources are considered. Possibilities and solutions for reusing or recycling the product at the end of its life cycle are thought of already when designing the product. One of the essential aspects of circular economy is that the manufacturer thinks ahead about how the customer can utilise the product later without sending it directly to landfill. Companies have different ways to do this and in fashion the most common model is to return the product to the producer who then reuses or recycles it.

Stella Soomlais said: “We joined in with the following targets:

Action Point 1

Implementing design strategies for cyclability. By 2020, circular design principles will be applied to 100% of our leather bags in order to remanufacture them after their first life. Action Point 2

Increasing the volume of used garments collected. By 2020, we will implement a garment collection scheme for used leather bags in our retail stores and online.”

TAXES 30%

1. Design for purpose 2. Design for longevity

3. Design for resource efficiency 4. Design for biodegradability 5. Design for recyclability

6. Source/produce more locally 7. Source/produce more without toxicity

8. Source/produce more efficiency 9. Source/produce with renewables

10. Source/produce with good ethics 11. Provide service to support long life

12. Reuse, recycle and compost all remains 13. Collaborate well and wisely

14. Use, wash and repair with care 15. Consider rent, loan, swap, second-hand or redesign 16. Buy quality as opposed to quantity

Here the company explains how customers can return the bag they have made and customers have lovingly used until the end of its glorious life.

‘Already several years we design our bags following the principles of circular economy. In our case, it means that all bags are designed in the way that makes them easy to clean and care for, repair and the leather of the bag can be reused to its fullest potential.

Leather that has been well taken care for, we can reuse for our Round 2 products and the material that has seen some rougher days, will be repurposed via reprocessing. We can also reprocess our smaller products that don’t fill their purpose for you any longer.

Although vegetable tanned leather is biodegradable, the process takes quite a long time and thus it is most reasonable to get the most out of the leather that has already been produced.

In order to make it convenient for you to return the used products (after long and loving use, of course), we offer 10% discount for new products. If you have taken good care of your bag, the discount can climb up to 30%.’

Stella Soomlais, founder