The Growing Popularity of Resale Merchandise
Retail Tech Insights | Wednesday, September 28, 2022
The resale market now accounts for over 10 percent of apparel sales among young people.
FREMONT, CA: Youth apparel sales have risen to over 10 percent through resale merchandise. Sales will increase by double digits over the next five years, making it a desirable growth industry.
Existing resale platforms such as ThredUp, Tradesy, Depop, and RealReal have raised billions of dollars, and new startups are entering the market. Vestaire Collective is concluding a fundraising round for around $210 million, and Grailed, attempting to raise $60 million, are both welcomed. In addition, there are new agreements, like those between Adidas and ThredUp and Net-a-Porter and Reflaunt. This demonstrates the significance of secondhand merchants and direct sellers. Even Gucci has created a storefront on RealReal.
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According to credible estimates, the global secondhand fashion sector is about $130 billion. As the business has evolved and attracted young fashion consumers (Gen-Z) who enjoy some of the brands and want to purchase some of them, legacy retailers are taking it more seriously. These shops cannot disregard this trend since they must continue to attract young consumers in the future.
Here are several causes for the acceleration of growth.
Well-Managed and Marketed: Secondhand merchandise platforms are now more organized and enticing to shop on.
Brand Appeal: The principles and brands attract young individuals who would never have considered purchasing designer labels.
Buy Now Urgency: Because designer outfits are in limited supply, a newly discovered diamond is a "must buy now" item.
Stigma Gone: The stigma associated with secondhand fashion has reduced as friends brag about their finds.
Retailer Verification: Major retailers like Macy'sM, Kohl'sKSS, JCPenneyJCP, and GapGPS sell used clothing. This gives the product an authentic patina.
Widespread Acceptance: There is widespread acceptance of resale shopping; it is gaining steam in areas such as the United States, Canada, the United Kingdom, France, and Germany. All of these markets are experiencing robust sales.
The resale of previously owned durable products is not new; it has been robust for quite some time. The pandemic has now increased demand even further. In recent months, used car sales have been exceptionally robust. Used car prices have increased by 45 percent due to the shortage of computer chips, which has decreased the production and availability of new car stocks. Some dealers claim they do not sell used vehicles. According to dealers, everything is selling, from luxury vehicles to inexpensive automobiles that parents may purchase for their teenagers.
Luxury fashion labels are aggressively entering the secondary market. It is intriguing to note that Gucci will manage its brand at RealReal, thereby controlling the pricing of pre-owned merchandise. For instance, one might anticipate additional sports shoe offers from other major manufacturers in the wake of Adidas's partnership with ThredUp.
Today, luxury goods are in high demand but often too expensive to afford in the post-pandemic era. Having secondhand merchandise under control will enhance the retail selling floor.
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