The textile industry is considered one of the most challenging industries when it comes to environmental pollution just after the oil industry. It has a huge impact on water pollution and resource consumption in terms of fiber production. Recently sustainability in cotton fiber production is questioned due to the huge uses of land, water, a large number of pesticides, and a significant amount of energy during cultivation. When it comes to cellulosic pulp production, currently fibrous plant material is used which is mainly wood. So, recycling of cellulosic textiles is considered the only option to reduce this impact. The recycling company Renewcell is launching a large-scale plant for cellulosic fiber recycling which is located in Sweden and will use the post-industrial textile waste as one of its feedstocks. The purpose of this research is to analyze the barriers and drivers for collecting this post-industrial textile waste from the garment manufacturing countries to Sweden and analyze the available collaborative business model alternatives. This study was performed by a qualitative study where primary data was collected through semi-structured interviews and analyzed by thematic analysis. The data was collected among four stakeholders within this value chain which are the fashion brands, recyclers, garment manufacturers, and waste handlers. The finding shows that this sector is very informal and is yet to be formalized. The external informal influence was identified throughout the value chain as a non-value-added activity.  And the involvement of fashion brands was identified as one of the drivers. Several collaborative business models are discussed considering their applicability in different contextual situations. This analysis was discussed based on the seven themes which were generated during the thematic analysis and later discussed with the current empirical study and theoretical background. Collaboration between the recycler, traders, brands, and the textile manufacturers were discussed in different dimensions such as direct collaboration and logistic partnership approach. Then the research limitation was discussed in both methodological and research contexts followed by future research recommendations.