Two sweaters next to a small chalkboard sign that says "resale"
Photo: Canva

Fashion companies are increasingly setting up resale spaces. The Business of Fashion (BoF) reports that “resale as an industry is growing — and at 5x the rate of overall commerce. The market for pre-owned goods was $100 billion globally in 2022, and resale is expected to reach $250 billion globally by 2027, making up 23 percent of retail sales, according to the Ellen MacArthur Foundation.”

Used goods, vintage stores, and even luxury resale boutiques have discreetly remained successful in various forms, albeit in a fringe market, but times have changed due to the pressing need for sustainability and the influence of social media fashionistas/os.

“In the last 30 years, resale platforms have gained traction in the West, pioneered by eBay and Fashionphile in the 90s, and followed by the likes of ThredUp, The RealReal, Depop and Poshmark in the 2010s,” BoF claims. “Meanwhile, French resale platform Vestiaire Collective, which launched in 2009, raised €59 million in 2020 to expand into Korea and Japan.”

This shift partially signals a behavioral aspect that many consumers exhibit, that is wanting to get something they were not able to get previously due to factors like rarity and exclusivity. Additionally, brands that are popular and seen as being in-fashion might demand a higher price tag, but resale spaces can provide a lower cost of entry — a win for both consumers and brands.

This is evident in how, according to a BoF Insights report, the two most common reasons German and UK consumers tend to buy secondhand fashion are “if an item is sold out at a brand or retailer, and checking to see if it is available on resale; and to see if a branded item is available for a lower price.”

Another catalyst for the rise of resale is the company Trove, which launched in 2016. Trove offers “scalable, branded recommerce solutions, providing the trade-in and operations technology needed to generate a reliable supply to sell at scale on a brand’s own dedicated site, integrated into their existing channels.”

Currently, Trove has helped the following brands launch resale platforms at scale:

  • Lululemon
  • Levi’s
  • Patagonia
  • Eileen Fisher
  • Nordstrom
  • Canada Goose
  • Carhartt

As noted in our previous recycling bin scheme discussion, sustainability efforts need to be monitored, especially since fast fashion brands like Shein have been called out for greenwashing. 

In regards to sustainability, Trove believes that “resale is not inherently sustainable. Rather, it is highly dependent on how the business model is set up to shift revenues away from new production.” Furthermore, “resale only offers environmental benefits if the intent is to reduce the manufacturing of new products.”

This good intention of sustainability with the promise of profit has its fair share of challenges.

At the forefront, there’s always the risk of counterfeit products being resold, either purposefully or accidentally. Modern Retail explains how some companies have been using machine learning to detect counterfeit items, with a method to “train their authentication algorithms to recognize patterns and features that distinguish genuine products from fake ones. This involves analyzing products for things like logo placement and trademarks, and then flagging those inconsistencies.”

Along with building a database to track the selling record of consignors, these machine learning processes are meant to support human decision-making and speed up the process for workers. Modern Retail also cites how Amazon and eBay have had to either block or remove millions of items that were deemed counterfeit. 

Particularly, luxury brands “need to authenticate products and ensure quality control. Luxury brands run a greater risk with fake products — and with less regulation in authenticating in peer-to-peer marketplaces, this option can create more opportunity to damage a brand’s reputation.” 

In spite of this challenge, resale treads on, but brands have their work cut out for them if they want this new segment to succeed exponentially.

BoF and Trove estimate that 50% of brands are promoting their resale efforts through blogs, how-to guides, and similar content, but only 34% display resale-related content on their homepages. Fewer still integrate their pre-owned merchandise into a cohesive shopping experience with their new products, let alone allowing shoppers to combine new and pre-owned items in the same cart.

“A best-in-class example is Coach’s online storefront, which provides universal search across new and pre-owned products, and consistent item content, payment options, policies across new and pre-owned items,” Trove adds.

Finally, employers will need to educate all of their employees about resale items and best practices to form a streamlined experience for consumers.

BrainTrust

“Many fast fashion brands are adding resale but not changing the practices that are detrimental to the environment.”

Melissa Minkow

Director, Retail Strategy, CI&T


“It makes sense for higher-end retailers to enter the resale market so they can continue to control and enhance the user’s experience with the brand.”

Katie Riddle

Global Retail Strategist, Verizon


“While it’s becoming more acceptable and mainstream to not only seek out secondhand, but also to gift it, there are certain populations that will never embrace resale.”

Jenn McMillen

Chief Accelerant at Incendio & Forbes Contributing Writer

Discussion Questions

DISCUSSION QUESTIONS: Should all major established brands have resale items fully integrated with brand-new items in their online and physical stores? What do you think about major established brands offering dedicated stores with resale products only?

Poll

Would you buy a resale item over the same item brand-new?

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17 responses to “Brands Are Launching Resale Marketplaces and Blurring Lines”

  1. Neil Saunders Avatar
    Neil Saunders

    The customers of most brands are shopping in resale as well as shopping for full priced items. So, it makes sense for brands to enter the resale space, as many have. Given resale is a complex operation that does not simply bolt-on to core retail some separation between retail and secondhand is necessary, especially as behind the scenes the resale operation is sometimes run by providers like thredUP (through its Resale as a Service platform) or Trove. That said, making things as seamless as possible for consumers on the front end is valuable – provided products are clearly demarcated between new and used. However, allowing shoppers to shop exclusively in new or used sections is also important as some customers come with a very firm view of which pool they wish to fish in. 

  2. Rick Watson Avatar
    Rick Watson

    Apparel is incredibly wasteful, high-end brands hold their value for longer than most people think, and consumers are very price sensitive.

    Many consumers will buy a few full price statement pieces, but use off-price to fill in the gaps whether it is directly from the brand, from places like TheRealReal, eBay, ThredUp, or other places.

    The trend isn’t going anywhere for a while and will continue to grow because it fits the needs of all sides.

  3. Gary Sankary Avatar
    Gary Sankary

    I would challenge the statement that resale retailers have been “discretely” successful. In fact, this has been a hot trend for a while. Adding resale items to an assortment makes a statement about sustainability and value that a segment of customers is going to identify with and support. The key to success in this space is to ensure that customers can easily identify resale from new. It’s also imperative that the brands have quality control processes in place so customers can be confident with their purchases.

  4. Allison McCabe Avatar
    Allison McCabe

    As always, providing the customer with the best experience is critical. The more they understand about the practice and mission of each brand in offering resale, the more accepting they will be of the concept.

    • Understanding the refurbishing that may or may not be provided, as well as the pricing methodology will go a long way in overcoming hesitations regarding the value of the resale merchandise.
    • The statement Trove believes that “resale is not inherently sustainable. Rather, it is highly dependent on how the business model is set up to shift revenues away from new production.” is a lynchpin to a true sustainability practice so the ability to factor resale inventory into revenue projections will become more important if this is truly to succeed as that will truly reduce new production.

    Looking forward to recognizing the multiple benefits of these business models for both the consumer and the environment!

  5. Gene Detroyer Avatar
    Gene Detroyer

    The numbers suggest that if it is up to the consumers, all major brands will offer resale items.

    The challenge for anyone dealing with resale is on the operational side. The traditional supply chain for brands is relatively straightforward. Resale adds multiple steps in identifying worthy products, processing them, and determining how to sell them.

    Will resale items become so popular that demand will outstrip supply? Then what?

  6. Melissa Minkow Avatar
    Melissa Minkow

    This is a super important topic. Many fast fashion brands are adding resale but not changing the practices that are detrimental to the environment. If those practices aren’t changing, and resale is being sold just to achieve control over that part of the market (vs being sold in place of new items), this is just adding to the sustainability problem rather than taking away.

    1. Gene Detroyer Avatar
      Gene Detroyer

      I believe you expressed a real issue. How does management react when resale starts taking volume from first-use items?

      1. Scott Norris Avatar
        Scott Norris

        At least the manufacturer/brand would be learning firsthand where the volume is shifting, and making some margin, rather than not knowing – because that resale will be happening somewhere and why not with them? Are there aspects of specific vintage models / patterns that the consumers demonstrate they are willing to seek out and pay a premium for? Then those elements need to be re-introduced to first-run production.

  7. Katie Riddle Avatar
    Katie Riddle

    It makes sense for higher-end retailers to enter the resale market so they can continue to control and enhance the user’s experience with the brand. And especially as the economy continues to be unsure, people are looking for deals.

  8. Jenn McMillen Avatar
    Jenn McMillen

    Resale appeals to a certain audience. While it’s becoming more acceptable and mainstream to not only seek out secondhand, but also to gift it, there are certain populations that will never embrace resale. That said, I’m in the former, and I applaud all efforts to reuse/recycle/repurpose.

  9. Jeff Sward Avatar
    Jeff Sward

    It seems like brands would be highly incentivized to offer resale within their own vertical. If the long term benefit is resale instead of newly manufactured products, then a brand certainly doesn’t want to see those sales migrate to another vertical. And if properly executed, the brands’ commitment to sustainability is legitimized. The status quo of the apparel business is unsustainable, just to double down on that word. And just like a lot of oil companies are in no hurry to see the demise of the internal combustion engine, there are large segments of the supply chain in no hurry to take their foot off the gas (pun intended) in manufacturing new product. There’s a lot of work to be done on changing customer thinking and behavior before we run out of landfill space.

  10. Lee Peterson Avatar
    Lee Peterson

    it’s definitely a step in the right direction, for the environment and business. Resale is hot, and no wonder; as it re-creates the lost art of a treasure hunt at retail. Some fast fashion companies may be doing a little greenwashing, but so be it, at least they’re headed in the right direction.

  11. Craig Sundstrom Avatar
    Craig Sundstrom

    Well, I’ve warned them! Seriously, tho, I’m just not a big fan of this; it strikes me as something companies are doing out of desperation, rather than an organic growth of their business models.”Sustainability” strikes me as a rationalization, since this really isn’t about whether items will be reused – that’s always happened, and this really does nothing to change that – but who will sell them. Meanwhile the problems of consistent sourcing and quality control should be obvious. And let’s not forget the numerous charities who will see this as dollars out of their pockets…logically so.

  12. Lisa Taylor Avatar
    Lisa Taylor

    As the choices in this space continue to grow, we can expect the addition of alternative models to condition customers to expect such alternatives, or or even think more carefully about the source of goods. As inflation drives higher costs, there is appeal in seeking out less expensive options such as buying second-hand, reselling to afford new and repairing damaged goods vs replacing. Retailers need to keep this in mind when considering strategy, operations and business capabilities. To remain competitive, retailers will also need to carefully consider the messaging and perception of ESG and ESG-adjacent initiatives and whether they have the capabilities to adapt and scale as their customers demand more choice.

  13. Rachelle King Avatar
    Rachelle King

    Resale and sustainability face the same headwinds: good intentions with bad quality controls. If most brands are honest, the resale market is just as hard as the retail market and may not be for everyone right now.

    If brands can swing it, then it makes sense for full integration of new and resale items on e-commerce sites (less the fear of ‘trading down’ customers can be equally balanced with building loyalty and retention).

    For brands not ready to delve into resale, there are still basic steps they can take to try to ensure responsible resale or recycling of products with respected parners.

  14. Roland Gossage Avatar
    Roland Gossage

    Resale markets offer a great opportunity for brands to expand their offerings to meet consumers where and how they’re trying to shop. In this case, customers who are looking to be more eco-friendly with their purchase decisions or who are looking to save on costs and are willing to buy second-hand for a discount, benefit a lot from resale.

    This is a natural expansion for those with a loyal customer base interested in resale shopping experiences, though they do need to consider the potential impact on brand image, operational logistics and profit margins/revenue returns. Brands that are looking to be exclusive for instance may want to hold some items back from resale.

  15. Anil Patel Avatar
    Anil Patel

    The resale market is definitely gaining traction and has potential growth opportunities in the future. However, the reason for big brands to enter this market is clearly to keep customers engaged and motivate them to purchase new products in exchange for the old.

    From a retail standpoint, it is not logical to have used products displayed alongside brand-new items. The retail industry clearly demonstrates that major brands intentionally manufacture lower-quality products and distribute them through factory outlets. On a similar line, retailers can resell products through factory outlets where they can find a significant customer base who seek to buy branded items at low prices.

    In my opinion, the scope for major established brands in the resale market will be much more fruitful from an off-price angle, rather than a mainstream approach.

17 Comments
oldest
newest
Neil Saunders
Neil Saunders
8 days ago

The customers of most brands are shopping in resale as well as shopping for full priced items. So, it makes sense for brands to enter the resale space, as many have. Given resale is a complex operation that does not simply bolt-on to core retail some separation between retail and secondhand is necessary, especially as behind the scenes the resale operation is sometimes run by providers like thredUP (through its Resale as a Service platform) or Trove. That said, making things as seamless as possible for consumers on the front end is valuable – provided products are clearly demarcated between new and used. However, allowing shoppers to shop exclusively in new or used sections is also important as some customers come with a very firm view of which pool they wish to fish in. 

Rick Watson
Rick Watson
8 days ago

Apparel is incredibly wasteful, high-end brands hold their value for longer than most people think, and consumers are very price sensitive.

Many consumers will buy a few full price statement pieces, but use off-price to fill in the gaps whether it is directly from the brand, from places like TheRealReal, eBay, ThredUp, or other places.

The trend isn’t going anywhere for a while and will continue to grow because it fits the needs of all sides.

Gary Sankary
Gary Sankary
8 days ago

I would challenge the statement that resale retailers have been “discretely” successful. In fact, this has been a hot trend for a while. Adding resale items to an assortment makes a statement about sustainability and value that a segment of customers is going to identify with and support. The key to success in this space is to ensure that customers can easily identify resale from new. It’s also imperative that the brands have quality control processes in place so customers can be confident with their purchases.

Allison McCabe
Allison McCabe
8 days ago

As always, providing the customer with the best experience is critical. The more they understand about the practice and mission of each brand in offering resale, the more accepting they will be of the concept.

  • Understanding the refurbishing that may or may not be provided, as well as the pricing methodology will go a long way in overcoming hesitations regarding the value of the resale merchandise.
  • The statement Trove believes that “resale is not inherently sustainable. Rather, it is highly dependent on how the business model is set up to shift revenues away from new production.” is a lynchpin to a true sustainability practice so the ability to factor resale inventory into revenue projections will become more important if this is truly to succeed as that will truly reduce new production.

Looking forward to recognizing the multiple benefits of these business models for both the consumer and the environment!

Gene Detroyer
Gene Detroyer
8 days ago

The numbers suggest that if it is up to the consumers, all major brands will offer resale items.

The challenge for anyone dealing with resale is on the operational side. The traditional supply chain for brands is relatively straightforward. Resale adds multiple steps in identifying worthy products, processing them, and determining how to sell them.

Will resale items become so popular that demand will outstrip supply? Then what?

Melissa Minkow
Melissa Minkow
8 days ago

This is a super important topic. Many fast fashion brands are adding resale but not changing the practices that are detrimental to the environment. If those practices aren’t changing, and resale is being sold just to achieve control over that part of the market (vs being sold in place of new items), this is just adding to the sustainability problem rather than taking away.

Gene Detroyer
Gene Detroyer
  Melissa Minkow
8 days ago

I believe you expressed a real issue. How does management react when resale starts taking volume from first-use items?

Scott Norris
Scott Norris
  Gene Detroyer
8 days ago

At least the manufacturer/brand would be learning firsthand where the volume is shifting, and making some margin, rather than not knowing – because that resale will be happening somewhere and why not with them? Are there aspects of specific vintage models / patterns that the consumers demonstrate they are willing to seek out and pay a premium for? Then those elements need to be re-introduced to first-run production.

Katie Riddle
Katie Riddle
8 days ago

It makes sense for higher-end retailers to enter the resale market so they can continue to control and enhance the user’s experience with the brand. And especially as the economy continues to be unsure, people are looking for deals.

Jenn McMillen
Jenn McMillen
8 days ago

Resale appeals to a certain audience. While it’s becoming more acceptable and mainstream to not only seek out secondhand, but also to gift it, there are certain populations that will never embrace resale. That said, I’m in the former, and I applaud all efforts to reuse/recycle/repurpose.

Jeff Sward
Jeff Sward
8 days ago

It seems like brands would be highly incentivized to offer resale within their own vertical. If the long term benefit is resale instead of newly manufactured products, then a brand certainly doesn’t want to see those sales migrate to another vertical. And if properly executed, the brands’ commitment to sustainability is legitimized. The status quo of the apparel business is unsustainable, just to double down on that word. And just like a lot of oil companies are in no hurry to see the demise of the internal combustion engine, there are large segments of the supply chain in no hurry to take their foot off the gas (pun intended) in manufacturing new product. There’s a lot of work to be done on changing customer thinking and behavior before we run out of landfill space.

Lee Peterson
Lee Peterson
8 days ago

it’s definitely a step in the right direction, for the environment and business. Resale is hot, and no wonder; as it re-creates the lost art of a treasure hunt at retail. Some fast fashion companies may be doing a little greenwashing, but so be it, at least they’re headed in the right direction.

Craig Sundstrom
Craig Sundstrom
8 days ago

Well, I’ve warned them! Seriously, tho, I’m just not a big fan of this; it strikes me as something companies are doing out of desperation, rather than an organic growth of their business models.”Sustainability” strikes me as a rationalization, since this really isn’t about whether items will be reused – that’s always happened, and this really does nothing to change that – but who will sell them. Meanwhile the problems of consistent sourcing and quality control should be obvious. And let’s not forget the numerous charities who will see this as dollars out of their pockets…logically so.

Lisa Taylor
Lisa Taylor
8 days ago

As the choices in this space continue to grow, we can expect the addition of alternative models to condition customers to expect such alternatives, or or even think more carefully about the source of goods. As inflation drives higher costs, there is appeal in seeking out less expensive options such as buying second-hand, reselling to afford new and repairing damaged goods vs replacing. Retailers need to keep this in mind when considering strategy, operations and business capabilities. To remain competitive, retailers will also need to carefully consider the messaging and perception of ESG and ESG-adjacent initiatives and whether they have the capabilities to adapt and scale as their customers demand more choice.

Rachelle King
Rachelle King
8 days ago

Resale and sustainability face the same headwinds: good intentions with bad quality controls. If most brands are honest, the resale market is just as hard as the retail market and may not be for everyone right now.

If brands can swing it, then it makes sense for full integration of new and resale items on e-commerce sites (less the fear of ‘trading down’ customers can be equally balanced with building loyalty and retention).

For brands not ready to delve into resale, there are still basic steps they can take to try to ensure responsible resale or recycling of products with respected parners.

Roland Gossage
Roland Gossage
2 days ago

Resale markets offer a great opportunity for brands to expand their offerings to meet consumers where and how they’re trying to shop. In this case, customers who are looking to be more eco-friendly with their purchase decisions or who are looking to save on costs and are willing to buy second-hand for a discount, benefit a lot from resale.

This is a natural expansion for those with a loyal customer base interested in resale shopping experiences, though they do need to consider the potential impact on brand image, operational logistics and profit margins/revenue returns. Brands that are looking to be exclusive for instance may want to hold some items back from resale.

Anil Patel
Anil Patel
1 day ago

The resale market is definitely gaining traction and has potential growth opportunities in the future. However, the reason for big brands to enter this market is clearly to keep customers engaged and motivate them to purchase new products in exchange for the old.

From a retail standpoint, it is not logical to have used products displayed alongside brand-new items. The retail industry clearly demonstrates that major brands intentionally manufacture lower-quality products and distribute them through factory outlets. On a similar line, retailers can resell products through factory outlets where they can find a significant customer base who seek to buy branded items at low prices.

In my opinion, the scope for major established brands in the resale market will be much more fruitful from an off-price angle, rather than a mainstream approach.