The Future is Resale

Today we’re looking at the industry known as resale & consignment. With a younger generation driving demand, private companies are proving that one person’s trash is another person’s treasure.

Where the market has been

Several companies come to mind for consignment, primarily in the luxury fashion market. The RealReal was founded in 2011 by e-commerce expert, Julie Wainwright, who led the company through 8 funding rounds before going public in 2019. Rebag offers consignment for luxury handbags and has developed a technology that identifies items by image and creates instant price quotes for resellers. Buffalo Exchange is a popular and longstanding reseller, with 29 stores across the U.S., and a customer base that enjoys the affordability and original selection.

                                                                                       Image by ThredUp

Where the market is going

Treet and Trove are two companies trying to cut out the middleman by giving brands the chance to own their own resale operations. Say you have a Patagonia jacket that no longer fits. Trove helps Patagonia reach out to its customers to let them know they can sell the jacket back to the company, who will authenticate and refurbish before recirculating to consumers. These two companies offer brands an opportunity to enter the resale market and promote a more sustainable brand of loyal customers.

Second-hand generation

High school used to be the site of brand-name envy among kids just wanting to fit in. But a shift toward secondhand, particularly among Gen Z, has taken root. Etsy recently acquired Depop, the Gen Z app for reselling, paying $1.9BN cash earlier this month. Etsy cited a desire to own a piece of Depop's younger, digitally native consumer base, with 90% of users under 26.

Trashion is the future

Fashion is now the second greatest polluter in the world with the number of garments increasing as quality diminishes. The resale industry is a $28BN industry today that is expected to eclipse fast fashion by 2029. For more examples of successful companies in the industry, just look to Poshmark which went public in late-2020, and Thredup, currently valued at $650MM.