Are Resale Stores the Way of the Future for Fashion Retailers?

Posted on May 26, 2020 by Carm McCormick

Are Resale Stores the Way of the Future for Fashion Retailers?

Posted on May 26, 2020 by Carm McCormick

Upcycled fashion is all the rage, and more than one big-named brand or fashion house is hopping on board the resale store train. Should you?

Thrifting and shopping resale stores have been relatively niche activities for some time – albeit popular ones – but as we move into 2020 and beyond, we’re seeing a huge surge in the popularity of fashion resale, where more brands are wondering, ‘Are resale stores the way of the future for fashion retailers?’

While brands like Nasty Gal got their start selling second-hand and vintage clothing, bigger brands like Nordstrom are turning to resale to increase the number of people who come into their stores and boost their sales numbers.

As a fashion retailer, do you need to be worried about this turn? Should you follow suit? And, what even is a resale store?

What is a resale store?

A resale store is a store, or a part of one, that buys and sells pre-owned clothing but is far more curated than a normal thrift store. Often, resale stores focus on high-quality, high-end pieces. These stores can be found within physical stores, as an independent online store, or as a sub-category of an already popular store.

Why have resale stores become so popular?

Beyond being drawn to products and brands based on price and quality, the growing trend of eco-friendly and sustainable fashion has captured an entire segment of consumers who are growing more aware each day of alternatives to fast fashion. 

Traditionally, fast fashion has been thought of as cost-effective but not high-quality, and as awareness around global waste production and climate change grows, fashion houses and brands who weren’t eco-conscious before are turning to resale to give an untapped group of customers exactly what they’re looking for: quality fashion items that have been ‘recycled’ at an affordable cost.

For retailers, the growing trend of buying sustainably gives them an opportunity to increase profit margins, get consumers through their doors to find clothes they won’t see anywhere else, and help consumers feel better about their purchases. 

Big brands are leading the way

Thrift shops and vintage stores that sell used clothing used to be relegated to small shops or locations tucked away from other shopping areas, like larger independent retailers, malls, and outlets. But today, the ‘upcycle’ trend has changed all of that, making it trendy and fashionable to buy clothing not just made from recycled or eco-friendly materials, but used and resold. 

Large brands like Nordstrom, RealReal, and ThredUp are leading the charge, and ThredUp has seen exponential growth in the resale space; as Neil Saunders, their Lead Market Analyst put it, “Compared to the overall apparel market, resale’s growth has been phenomenal. As the market uniquely meets consumers’ preference for variety, value, and sustainability, we expect the high growth to continue”. To be exact, they believe the second-hand market will reach $51 billion by 2023 – a 5x increase in just over a decade.

Is Resale the Answer to Every Retail Brand’s Problems?

Those kinds of figures are enough to give any retail business pause, especially when it could be possible to reduce import costs and become a more sustainable company overall, but how can you determine if a resale store or department is right for you?

1. Know what your customers want (and value)

If you’re considering adding a resale store to your existing brand, you need to analyze your target customer profiles, perform research into their buying patterns, and decide whether there is an interest in a segment of your customers and your market that would benefit from access to a resale store. 

Moving into the resale space will inevitably attract new customers, but if you’re going to be adding onto your existing brand and not starting from scratch, you need to think seriously about what your brand stands for and what your customers will feel is, or isn’t, aligned with the brand they believe you to be.

2. Consider whether you have the resources

Is there anyone on your team equipped to lead this new resale venture, or would you have to hire someone new? A resale store, like any new location, will inevitably become costly in both time, effort and financially, and hiring on an entirely new team just to test it out will feel like a risky exercise. While the trend is certainly showing exponential growth in this area, it’s best to test the waters with as many resources as you already have before investing in growing a resale store or expanding. 

3. Can you offer shoppers something unique?

What can you transfer from your brand to resale? What are you known for? Answering these types of questions will help you determine whether there’s a specific market need you can fill in the resale space that is similar to the one you already occupy. For example, The RealReal is known for luxury goods, so they don’t just sell used luxury clothing, but authenticate and restore pieces prior to sale. Are you known for a certain style, quality, or pricing strategy? Look at the current resale market and see if there is space for you to fill that same need there. If so, a resale store may be a great fit for your brand.

 4. Can you reinvent the way people shop?

Alternatively, can you offer a new way of shopping that is exclusive to your brand? If you already sell pieces that focus on quality, consider starting a loyalty program where you’ll buy back used pieces from shoppers for vouchers they can only use in-store. If you can create your own ecosystem within your store, you’ll not only create a circular process that does its part for the planet, but you’ll be able to profit from the same pieces and the same customers repeatedly.

So, should you open a resale store?

While resale isn’t the only way to catch the sustainability wave, it is one of the fastest to implement and is one that fits into existing brands easily. While bigger brands and fashion houses are testing out resale, small retailers can try it for themselves either through opening their own resale store or partnering with a sister brand to test the waters and limit risk. 

You can also easily integrate an area of your online store or physical stores to resale at low risk. Other than the time it takes to set up your online or existing retail space for resale, you can buy low and sell relatively high, as you’ve put in the hard work of finding the pieces that align with the style your customers know and love you for. For the low risk, there’s the potential for seriously high reward, so it’s well worth trying out a resale store if you have the resources available.  


Every fashion and apparel business is built on inspiring customers. But to compete in the world of fashion, you need a retail design like no other. And when it comes to resale, creating a space all its own means working with a team of experienced retail design pros who know what it takes to engage customers and get them through the door. Contact us today to explore how we can help you open a stunningly beautiful and converting retail space.