THE FUTURE OF FASHION RESALE: $2.1 TRILLION OF RESALEABLE FASHION INVENTORY LIES UNTAPPED IN CLOSETS WORLDWIDE
London, Monday 19 July 2021 - for immediate release
- The Future of Fashion Resale reveals that just 5-7% of resaleable fashion is currently being bought and sold on resale platforms, resulting in over $2.1 trillion of untapped fashion inventory in closets around the world
- The global secondhand fashion market is currently worth $130 billion, driven by resale platforms becoming more sophisticated and stigma around buying secondhand diminishing
- A survey of consumers in US, UK, France, Italy and China reveals that 50-60% have purchased secondhand fashion before and only 15% stated they are not open to purchasing or selling secondhand fashion
Today, a new report from The Business of Fashion (BoF) reveals that only 5-7% of resaleable fashion is currently being bought and sold on resale platforms, resulting in an estimated $2.1 trillion of fashion sitting untapped in closets around the world. The Future of Fashion Resale, published by the BoF Insights Lab, a new data and analysis unit at The Business of Fashion providing business leaders with proprietary and data-driven research to navigate the fast-changing global fashion industry, estimates the global secondhand fashion market is currently worth $130 billion. In the United States, the secondhand fashion market will continue to grow by 16% annually, reaching $57 billion in value by 2025.
Secondhand fashion has existed for decades, primarily in thrift and vintage stores, but the advent of online resale platforms has led to a step change in how used items can be bought and sold. Since 2019, there have been at least 13 new resale entrants, 6 new resale-as-a-service launches and 14 major brand partnerships. More brands and retailers are exploring their own resale strategies to attract new customers and become more sustainable. But with just a small proportion of resaleable fashion being tapped into by consumers, brands and retailers will increasingly seek to actively manage resale as a key retail channel.
KEY GROWTH DRIVERS
The fashion resale market shows significant potential for growth. Only 50-60% of consumers in the US, UK, France, and Germany have purchased secondhand fashion before, while an even smaller portion has tried reselling (30-55%) and only 15% stated they are not open to purchasing or selling secondhand fashion.
The report identifies five key drivers underpinning growth of the fashion resale market:
- Platform sophistication. Online resale platforms offer greater choice to consumers than physical stores, and over the past few years these online brands have invested in creating a more seamless customer experience.
- Favourable demographics. Younger demographics are more likely to buy pre-owned fashion than older consumers. For example, 65% of consumers in key markets aged between 18 to 24 have purchased pre-owned fashion compared to 56% of respondents aged between 50 to 59. Generation Z are particularly open to resale, and as this demographic matures the appetite for resale will be positively impacted.
- Reduced stigma. Improved customer experience on secondhand shopping channels has helped reduce the stigma around buying pre-owned fashion.
- Limited editions. Launching limited editions and exclusive ‘drops’ have become a staple marketing tactic for fashion brands and retailers, with scarce items driving significant activity on resale platforms.
- Sustainability. Sales of secondhand items are a key driver of the circular economy and enable a longer lifetime for items, tapping into increased consumer appetite for sustainable retail choices.
LUXURY RESALE
Luxury is an important part of the resale sector, representing just under a quarter (24%) of the overall secondhand market on a value basis.
While coronavirus had a negative impact on the primary market for luxury fashion, contracting by 22% in 2020, the pandemic accelerated the growth of secondhand luxury, growing by 14% year on year. BoF Insights predicts the global secondhand luxury fashion market will grow by 12% through 2025, reaching $56 billion in size.
CHINA
Resale is relatively underdeveloped in China compared to other markets, in part due to the importance of purchasing new items to signal wealth, especially when linked to holidays like Chinese New Year.
A number of local resale platforms have emerged which tend to skew toward luxury and streetwear. Particularly over the last five years, as consumer attitudes have warmed, international platforms like Stadium Goods, Vestiaire Collective, GOAT, and StockX have entered.
Imran Amed, Founder and CEO of The Business of Fashion, said: “Resale is now an unstoppable force in the fashion industry. Industry participants need to evaluate a complex set of dynamics and decide how they should engage in this fast-developing space. The Future of Fashion Resale offers an in-depth understanding of the state of the fashion resale market, where the key opportunities and challenges lie for brands looking to enter the space, and how the market landscape will evolve.”
Diana Lee, Director of Research and Analysis, The Business of Fashion, added: “New fashion resale platforms have become major players in the global fashion market, with a growing number of high profile partnerships and public listings. By engaging in resale, fashion brands and retailers have the opportunity to accrue economic benefits and deepen relationships with both new and existing customers, while influencing a product’s positioning and residual value through its lifetime.”
Findings in this report are based on primary research supported by consumer surveys run in multiple geographies, proprietary quantitative analysis of industry dynamics, and interviews with the founders, CEOs, and executive teams of leading resale platforms, resale-as-a-service companies, brands, and retailers. Platforms covered in the report include thredUP, Tradesy, Vestiaire Collective, Depop, Poshmark, The RealReal and many other emerging and established platforms and resale-as-a-service companies.
The Future of Fashion Resale is the first in-depth analysis to be published by the BoF Insights Lab, a new data and analysis unit at offering from The Business of Fashion that arms business leaders with proprietary and data-driven research to navigate the fast-changing global fashion industry.
See the report here.
ENDS
NOTES TO EDITORS
Citations
Any citations from the report should reference ‘The Business of Fashion: The Future of Fashion Resale.’
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Max Tobias, Camron PR for The Business of Fashion
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