Will Fashion Resale Ever Become Mainstream?

There is half a trillion dollars of unused clothing and accessories in women’s closets, yet only 1-2 percent is ever resold. Venture capitalists see that percent growing and are looking to find the winner in the resale battles. In the first three quarters of 2015, $220 million was invested in this space, up from $40 million in 2013.

Behind this growth are shifting attitudes toward second hand shopping. Sustainable consumption habits are up and there is a social shift toward less ownership. More Americans will visit a resale store than an outlet mall this year with 13% shopping at consignment shops and 11% going to factory outlets. Almost half of shoppers under 34 think about resale values when purchasing clothing and 80% of styleconscious consumers explicitly seek lasting value.

A variety of resale businesses are competing for market share. The largest is eBay, which represents the first category of resale business – online marketplaces that take a commission of 10-20% when your item sells. Others, such as Tradesy and European competitor Vestiaire Collective, are exclusively fashion focused. The next group is consignment shops that do much of the heavy lifting including photography and order fulfillment for a higher commission of 30-50%. Businesses in this space include The RealReal, thredUP and Threadflip. The final group will buy directly from you. Paybacks are very low with sellers recovering 10-30% of the item value. thredUP offers this service only on lower priced items.

A recent entry in this space, RE/LABLD, puts a new spin on resale. It appraises all items and pays sellers in store credit for full appraisal value upfront. It also offers free services to pick up or ship your item, and a concierge service that will photo and list the item for you. They take no commission and instead charge a listing fee, which is substantially less than commissions paid elsewhere.

Will any of these businesses succeed in taking resale more mainstream? RE/LABLD founder Sina Foroohar says “Not yet. While social trends are in resale’s favor and existing solutions reduce some of the friction by making it easier to sell, people need the process to be fully seamless before it is more widely used.” Foroohar adds “You have to commoditize the product for resale to become mainstream and that is what RE/LABLD is building the foundation to do.”

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RE/LABLD is the most cutting-edge marketplace for women to buy and sell luxury clothing and accessories. Simply sign up for an account, submit your items for appraisal and instantly earn credits for full appraisal value as soon as your items are listed. Then shop for a new wardrobe without spending money by redeeming your credits or purchase credits for $1 each with 50% donated to RE/LABLD Charities. Please view our media presentation hereFor additional information visit the RE/LABLD 'How it Works' page.

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