ABSTRACT
The transition towards a circular economy requires retail environments that encourage customers to extend clothing use and adopt more sustainable consumption practices. While previous research has examined circular business models and consumer behaviour, less is known about how retail environments enable customer value-in-use in a circular fashion. This study explored how retail environments foster customer value creation processes that extend clothing use and support circular practices. A qualitative multiple-case study was conducted with small- and medium-sized circular fashion retailers and their customers in South Africa and Belgium. Data were collected through semi-structured interviews and participant observations, and analysed using the Gioia methodology. Findings reveal the customer value creation processes enabled include: constructing meaning and authenticity through circular fashion servicescapes; building relationships across integrated servicescapes; and learning, reflection and identity construction through servicescapes. The study contributes to retail design, servicescape and circular fashion research by demonstrating how designed retail environments enable customers to cocreate value through relational, experiential and transformative processes that extend beyond purchase. These processes support circular practices while fostering eudemonic wellbeing through meaning-making, identity development, and value alignment, and community wellbeing through connection, belonging and participation.