Many consumers love buying and selling second-hand items due to cost-effectiveness, as well as ethical and environmental benefits. Additionally, as the societal stigma around second-hand clothes has been flipped and it is becoming ever more trendy to buy vintage, repurposed, and second-hand products, these numbers are continuing to grow quickly.
According to Research Gate, the speed of development and Compound Annual Growth Rate (CAGR) of the multi-billion dollar second-hand industry is much higher than that of newly manufactured items. This is consistent across all areas, from fashion and furniture, to automotives and electronics, and is predicted to continue increasing in the next few years.
Fact and stats:
Resale in the second-hand fashion market is predicted to grow at almost double the rate of fast fashion by 2029, according to a 2020 resale report by thredUp.
The CAGR of the luxury goods market, including antique furniture, watches/jewellery, artwork and fashion, grew at a rate of 12% between 2014-2019 - Globe News Wire.
The global used car market is expected to have a CAGR of 5.5% between 2020 and 2027, reaching a value of $2,150.6 billion by 2027 - Grand View Research.
Off-the-shelf second-hand furniture is predicted to have a global CAGR of 6.4% between 2018 and 2025 - Research Nester.
In the next 5 years, buyers plan to spend 52% more on second-hand items and 43% more on sustainable fashion, while at the same time spending 24% less on fast fashion and 44% less in department stores, according to a 2020 - Global Data Consumer Survey.
ESG investing is increasing: in 2012, ESG assets were at 11%, and by 2050, they are expected to increase to 50%.
Since 2017, the global sales of new smartphones has been in decline with the biggest drop of 20.2% in the second quarter of 2020 - Gartner, whereas the used smartphone market value is predicted to increase to $52.7 billion by 2022 - IDC.
With an increased awareness of the importance of adopting a more circular economy in order to address the climate crisis, recent surveys show that 82% of second-hand shoppers consider sustainability to be an important reason for buying from second-hand, sustainability-driven sites. Less energy is used, less water is used, and as measured by Schibsted in 2019, users buying and selling in their second-hand marketplace saved around 25.3 millions tonnes of CO2 that year.
Alongside growing concerns over the disastrous impact the mass production of goods is having on the environment, being stuck at home during the pandemic has caused a shift in the shopping behaviour of consumers. Many people have been using the extra time to ‘Marie-Kondo’ their houses, leading to more people selling their items online or donating to organisations for resale. The economic uncertainty during COVID-19, which is likely to continue for the foreseeable future, has also caused people to buy less, and to favour second-hand items with more competitive prices.
The Business of Fashion says, “before the pandemic hit, the resale market was on track to double. Now this growth may very well accelerate. Resale sites are coming out big winners as the pandemic plunges the economy. Analysts predict consumers will turn to sites like thredUP and Rebag to clean out their closets for extra cash.”
What to consider when selling second-hand products online
Partner with brands that sell well, and provide assistance for your consignors on what products and what brands are best to consign with. Offering additional perks can also encourage consignors to sell more items with you. Luxury consignment platform RealReal for example has partnered with the likes of Stella McCartney and Burberry, and offers consignors spending vouchers or personalised styling appointments with the respective brand once a certain amount has been made in sales.
Set a realistic price by starting with the original value of the newly manufactured item, and then reducing it in accordance with wear and tear and extent of usage, additionally checking against the price of similar second-hand products sold on other online marketplaces.
Decide on your commission rates and offer loyalty benefits to consignors, such as increasing the amount they earn in alignment with the amount they sell. Providing additional support, such as offering consignment consultations with advice on pricing, photographing, and shipping items can encourage more people to sell on your platform over other competitors.
High-quality photographs and a detailed product description are required for specifics about the material of the product, dimensions, any additional relevant features, and any defects. If the product is vintage, it is important to include the name of the designer, date of production or the date of the collection it is from, and the location of origin. With electronics or automotives, the extent of usage and relevant technical details should be included too.
With luxury and vintage brands, consider using an authentication service to assure customers the products are high quality and genuine. Ensuring consignors of a strict no-tolerance policy to counterfeit items can also provide proof of your platform’s commitment to authenticity.
Existing examples of resale platforms
A couple of the trendiest and most popular platforms for selling and buying second-hand products are Depop and thredUp. Both platforms are very active with marketing on Instagram, positioning themselves as chic and unique, and socially, ethically and environmentally responsible respectively.
There are quite a number of luxury resale platforms selling designer products, from platforms like Rebelle, Edit Second Hand and Cudon selling clothing and accessories, to platforms like Pamano, Vinterior, and Selency where on top of the usual predicted items, you can also find niche interior decor and vintage toys.
Big fashion brands have equally realised the potential of the second-hand market and now have their own schemes on their existing websites for customers to sell and buy used items. Some examples include Cos Resell, Asos Preloved, Resellfridges, Farfetch Second Life and Urban Renewal. These platforms offer the option for consignors to resell their clothes and accessories in exchange for credit on their respective websites or in-store.
Finally, favoured platforms such as Ebay, Vinted, Facebook Marketplace and Etsy allow users to sell an array of second-hand products, giving the user more control over how and what they sell. These platforms often allow the seller and buyer to interact directly without any need for a middleman.