Store closures during the COVID-19 pandemic caused the global fashion retail market to shrink 23%, according to ThredUp’s Resale Report. Meanwhile, the secondhand market grew 27% and is expected to double by 2025, reaching $77B. Faced with economic uncertainty, today’s consumers are hunting for great deals. They’re also looking to limit their environmental impact and have found secondhand shopping to be a more sustainable alternative to buying new clothes (Kearny).
Studies have also found that the most effective way to reduce the fashion industry’s CO2 emissions is to produce fewer new clothes. By avoiding overproduction, the fashion industry could cut its annual emissions almost in half. Since people are buying new less, there’s pressure on brands to reduce production in an effort to be less wasteful.
Does this mean that if fashion companies produce fewer clothes, they will also make less money? Not necessarily. Today’s fashion industry works in a pipeline business model. Brands sell an item to a consumer and then lose sight of it. Revenue is created only once. Secondhand shopping feeds worn clothes back into the market, creating a circular business model. That same item creates revenue multiple times with less strain on the environment.
With brands like Allbirds, CUTS and Lululemon diving into resale, more and more brands are finally catching on. Companies are launching their own secondhand shopping experiences to attract more price-conscious and sustainability-minded consumers, and to increase revenue by participating when items are resold. If you’re curious about the opportunity at hand – namely, how much new revenue you can really make off branded resale – you’ve come to the right place.
We’ve launched 40+ Treet secondhand marketplaces for brands in the past year, and we’ve been able to successfully gauge the revenue potential of their peer-to-peer resale markets with the help of our Resale Revenue Calculator. We’re making it available to you for free so you can calculate your:
Estimated resale GMV – expected total sales from peer-to-peer resale, month over month
Estimated resale-attributed revenue – total revenue you may expect from resale, including increases in new product conversion
Net new customers – influx of new customers that shop secondhand vs. firsthand
Environmental impact – reselling an item reduces its impact on the planet by 82%
Fill out this form to get our Resale Revenue Calculator and see what the revenue potential of your resale market is today. Also, be sure to check out this blog post for tips on launching a successful recommerce program.
Want to learn about launching a secondhand shop with Treet? Contact us at firstname.lastname@example.org.