The secondhand, resale and pre-loved market is booming. Recent research from eBay Ads UK found, from a survey of 1,000 consumers, that consumers are increasingly turning to shopping for second-hand goods as the cost of living crisis deepens and ‘climate consciousness’ increases. 25% of UK consumers bought secondhand fashion in 2021. A quarter of those surveyed said that they try to upcycle or repair their current belongings before buying anything new, and 20% reported that they frequently buy second-hand, upcycled or refurbished items.
Left - Kidswear Collective at Selfridges
In January 2022 searches for ‘upcycled’ rose 40% on eBay UK compared to the month before, and searches for ‘second hand’ and ‘repair kit’ rose 24% and 21% respectively.
Searches for ‘pre-owned’ rose 19% in January 2021 compared to January 2020 and increased a further 38% in January 2022.
On the other side of the Atlantic, Thredup, the American secondhand online store, expects the secondhand market to grow 127% by 2026. It predicts the market to be worth $84 billion by 2030, while fast fashion is predicted to be worth about $40 billion dollar in comparison.
While the UK has always embraced vintage, charity and secondhand stores, it seems like America is finally losing its love of the new and brands are piling into the market.
Brands with their own resale shops increased 275%, from 8 in 2020 to 30 in 2021 with names such as Hugo Boss, Lululemon, Coach and Oscar de la Renta are all moving into resale, not only as a growing market, but also to improve their sustainability and green credentials.
The Thredup report also revealed that 52% of retail executives say offering resale is becoming ‘a must’ for retailers, while 88% of retail executives who currently offer the service say it is helping increase revenue. The resale market is growing at a rapid rate and brands will want to fulfil the demand and give a good, rounded offer to the consumer.
But, desirable resale is a finite resource and just as brands make for outlet, will we start to see brands tempted to fill those resale gaps with new product?
The margins, particularly on designer products, are so big that selling at resale would still give a decent level of return. What is the difference between brand new with tags (BNWT) resale and older outlet product? Nothing.
To give you an idea of scale, one of the market leaders in designer resale, Vestiaire Collective, currently has over 3 million items and 10,000 brands available with over 20,000 new fashion items listed every day. Orders grew 90% globally, over the past year, highlighted by a 100% increase in the US, now its largest market.
This kind of inventory level is unsustainable, especially if more outlets and brands are competing for it.
Rónán Ó Dálaigh, co-founder of Thriftify, which develops technology to help charities sell online, says, “Whenever I see a brand announce resale, I want to know what else are they doing. Are they going to sell less new fashion? If not, it’s a pure marketing exercise.” he says.
Thriftify allows charities in the UK and Ireland to seamlessly upload their product online, giving me them a larger audience and potentially raising more money in the process.
“If we can get them all online we create a genuine alternative.” he says. “In 3-5 years, we will be able to shop the same volume of fashion sizes, colour prices in used as you can new.”
Ó Dálaigh thinks consumers will see through brands making for resale. “I wouldn’t be surprised what the industry does.” he says. “They hold onto for a year and they’re already doing that, but we need to talk about production. We need less new fashion.” he says.
Lampoo is Milan’s leading luxury re-sale fashion platform, with a focus on retail bricks and mortar stores alongside its digital presence and about to open its first ever store in London later this June. Enrico Trombini, founder & CEO, says, “When we think about the second-hand portion of our wardrobes, for most people it’s probably still quite low.” he says. “However there are now a lot of resale businesses in the market, and I do think that like any other sector, it will reach a point where just a few key players will survive and all the others will be bought out or will unfortunately shut down.
“Sourcing is the main challenge for us and companies like us.” he says. “A company that wants to become a market leader needs to grow its inventory at a fast pace but if they want to remain well-positioned amongst other players, they also need to retain quality, ensuring they are constantly sourcing the most coveted and sought-after items.
“Some competitors have decided to enter the race by lowering their commission, or by buying the most desirable items upfront at a high cost, but many of these businesses do not have a unique proposition, so their strategies can be more immediate and less forward-thinking.”
Trombini thinks luxury brands have to embrace resale because they know they are missing a huge market opportunity if they don’t, and because their own customers will increasingly adopt sustainable ways to consume fashion like resale, rental or restoration. “The difficult thing for luxury brands is how to be an integral part of this market evolution without undermining their own brand equity.” he says.
"There will always be a difference between a brand new piece of clothing bought in a boutique and one in identical condition with tags attached that was bought from someone else's wardrobe. Whilst the items may be indistinguishable, the perception can understandably differ, especially in luxury where consumers are buying into a certain level of aspiration.” he says. “Despite that, savvy resale shoppers know that new with tag products are usually the best deal around, since despite being brand new, they are much more affordable.” says Trombini.
Founded in 2016 by Lewis Hull, Marrkt is a menswear online managed marketplace selling pre-owned items on behalf of individuals and brands. Originally a platform for deadstock menswear, the site switched its main focus to pre-owned in 2018 as a response to the growing narrative around sustainability and creating a circular economy. Marrkt currently has 12,000 items in stock from over 1,000 individual sellers from the UK and increasingly the USA, Europe and Australasia. Turnover has nearly doubled every year as the resale market continues to grow. Sales figures went from £300,000 in 2019, to £636,167 in 2020, to £1,109,505 in 2021.
On more brands entering the resale market, Hull says, “I guess it’s a good thing that more commercial brands are becoming more conscious, and finding their owns ways to operate in a more responsible way.”
“We only sell ‘new with tags’ if it’s deadstock from a brand.” he says.
“Rather than making for ‘resale’, I think more and more brands are re-considering their impact and adopting more circular initiatives likes offering ‘buy back schemes on used garments’ or selling ‘production samples’ at a discounted price. We’re all for re-using what’s already out there.” he says.
“Each platform out there serves a specific purpose, and it’s about finding a niche. Our demographic is different to Depop or Grailed for instance, as we cater for timeless quality brands, rather than hyped brands.” says Hull.
Shoshana Kazab is CEO and co-founder of Kidswear Collective, an online store selling pre-loved and past season designer fashion for children from birth to 14 years, where items are sold at up to 80% off their original retail price. It also has a concession in Selfridges.
She says, “Now is a very exciting time to be in the resale market. It’s so encouraging to see retailers and brands embrace this space and see it as an opportunity rather than a threat.
“There are definitely a lot more platforms around compared to when we launched but we are still at an early stage of adoption. Resale is the fastest growing segment in fashion yet, by most estimates, it still only represents less than 5% of the entire market so there’s plenty of scope for growth.” she says.
“Inventory is key to any resale business. I have worked in the kids industry for over 15 years and during this time have built trusted relationships with a lot of the key players ranging from influencers to stylists, which is where a lot of our stock comes from.”
The business operates on selling commissions and consignment selling.
“The more fashion businesses that embrace the resale movement the better.” says Kazab. “It’s not about buying less, but simply about buying better. Hugo Boss garments are very well made - it is actually one of our best-selling brands - which means that having a pre-owned offering will most likely be very successful for them.” she says.
“We want to encourage people to re-wear the same item as many times as possible. However, as many parents know, babies and children can often grow out of their clothes before they have had a chance to wear them. This means that many pieces come to us still with their tags on, and this is simply because the children haven’t had a chance to wear them. We give customers the option to buy ‘Past season’ as well as ‘Pre-loved’ for this reason.”
Kazab hopes brands don’t start to make for resale. “It will be far better for brands to partner with businesses like ours or Reflaunt in the adult fashion space. As professionals in this area, we can source and process stock on behalf of brands.” she says.
There is no doubt the resale market is growing, but this will only increase the pressure on quality inventory. In order to grow, these businesses will need increases in hyped product.
New with tags, pre-loved, pre-owned and secondhand are all terms used in the resale market. It could be argued that TK Maxx is a resaler when you consider unworn, new with tags, especially for it’s older, designer Gold Label product. ‘Resale’ has simply rebranded a lot of product that already existed.
If this area proves successful for brands, it will be very tempting to move product destined for outlet or even make popular product for resale. For many brands, such as Ralph Lauren, outlet makes up a huge proportion of their business and they could view resale as simply an extension of that. ‘Made for resale’ could be the next opportunity for big brands, but they certainly won’t be talking about it.
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