The trade of used items is as old as commerce itself, with some Neanderthals no doubt doing a brisk business in pre-loved spears, but when it comes to major brands selling their own used items online, chances are you have T-shirts older than the custom.
ThredUp tracks the brands with the most active resale programs on its The Recommerce 100 list, which is updated monthly, and as of November, the furthest back any on the list go is 2009, when Eileen Fisher (No. 13) launched its resale program; the next oldest brands on the list date back to 2017, when both Patagonia (No. 12) and REI (No. 29) launched their resale programs.
Brands that hopped on the resale bandwagon (brandwagon?) in 2024 account for 18 of the list’s top 100, including Modcloth (No. 7), Zara (No. 8), and New Balance (No. 27).
Befitting an emerging industry, there is not a consensus yet on what to call secondhand items, as Retail Brew highlighted this year. “Resale” now seems to have the most currency, beating other descriptive (“used,” “pre-owned,”) and fanciful (“pre-loved”) monikers.
This year, the industry challenged something no less daunting than the tax code, with retail leaders in both the US and Canada arguing that secondhand items should not be taxed. The argument: The products were taxed when first sold; doing so again is double taxation.
Here, according to three resale CEOs, are some other takeaways from 2024:
Resale grew as a channel for returns
Even if you weren’t in the retail trade, you’d notice the challenge of returns, as brands increasingly charge for previously free returns.
Jake Disraeli, co-founder and CEO of Treet, which has launched resale programs for more than 185 brands, said many of them bemoan returned inventory languishing in warehouses, which if they can’t offload to discount retailers like TJ Maxx, they may have to—gulp—pay for their removal.
“It’s been burning a hole in their pocket for a long time,” Disraeli told Retail Brew, referring to returns. “When we talk to brands, one of the first things they tell us is they have pallets of inventory in their warehouses that they don’t know what to do with.”
But by Q4 of this year, thanks to a tool on the Treet platform called Brand Direct, about 60% of its partner brands sell not just returns on their resale sites but also overstock and samples.
Among the value of doing so, according to Disraeli, is the likelihood that brands earn a higher margin on the items than they would selling them wholesale to discounters, and bolstering their resale sites, where shoppers find a better selection.
Resale became more integrated with new inventory
The launching of resale e-commerce sites typically herald a company’s entrée into resale, and brands generally have bifurcated the shopping experiences for new items and resale items—the conventional wisdom being that featuring lower-priced resale items on a brand’s main site could in a sense cannibalize it when shoppers opt for the lower-margin secondhand item over the higher-margin new one.
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But Terry Boyle, CEO of Trove—a branded resale service whose partners include Canada Goose, Carhartt, and Patagonia—told Retail Brew that 2024 “was the year where we started to see clients test or commit to put resale inventory alongside new inventory and full-price inventory.”
On Patagonia’s main site, for example, there’s an option on product pages above size and color options to click “Shop New” or “Shop Used.”
Boyle understands why brands have resisted integrating new and used inventory.
“People are always worried about cannibalization, and if they put the product next to the new product, people will choose the resale product and not buy the new product,” he said. But he added that, on the contrary, many brands are finding that shoppers are introduced to brands when they buy used items, and often eventually purchase new ones.
“A lot of our clients see such high penetration of new customers,” Boyle said. “That already suggests there’s not a lot of cannibalization here.”
Interest in brick and mortar resale surged
Brett Heffes, CEO and chair of the board of Winmark Corporation—which owns retail resale franchises including Plato’s Closet, Once Upon A Child, Play It Again Sports, and Music Go Round—said the company’s seen “franchise development activity at the highest level it’s been in over 10 years.”
That, said Heffes, means they’ve had more inquiries from would-be franchise holders, more signed agreements, and ultimately more store openings. While Heffes said that “over 90%” of those inquiries are from existing customers at the stores, he also said that buzz around online marketplaces like Poshmark and eBay is driving interest.
“There’s just so much awareness around the industry that once they understand that there’s a business opportunity here, they’re just coming at us in ways that we haven’t seen in a while,” Heffes said.