Secondhand Fashion Is Growing Rapidly, Set to Hit $64 Billion by 2025

It's a tough time to be in the fashion industry, with widespread store closures and staffing shortages and nervous customers whose disposable incomes have shrunk in recent months. The only segment of the industry that has really been flourishing throughout these strange times is secondhand, as revealed in the annual resale report published by thredUP and GlobalData, a third-party retail analytics firm.

thredUP is an online platform that allows people to buy and sell used clothing. It's a clever model that has managed to make thrift shopping as easy and convenient as shopping for new clothes online; and being established before the pandemic struck has allowed thredUP to grow impressively at a time when similar businesses are stagnating (or worse). 

The annual report for 2020 shows that "resale is set to soar." Between 2019 and 2021, online secondhand shopping is expected to grow by 69%, while the broader retail sector (including offline secondhand) will shrink by 15%. The entire resale sector is expected to grow to five times its current size over the next five years, hitting $64 billion in worth, and will be twice the size of the fast fashion sector by 2029.

What's driving this explosive growth? 

There are a number of factors. One is that shoppers are looking for better value, and they realize that buying used clothes is the easiest way to achieve that. The stigma associated with used clothing is not as strong as it once was (90% of Gen Z shoppers say there's no stigma at all), and almost half of shoppers surveyed say they plan to spend more on secondhand items in the next twelve months.

Another factor is the pandemic, and the fact that so many people have been cooped up at home. Avid shoppers had to find an outlet online, which is why platforms like thredUP did so well. It also received a huge amount of inventory, purged from people's closets during a "quarantine clean-out frenzy."

Finally, people are more concerned about sustainability than ever before. Young shoppers in particular are more aware of the damage caused by the fashion industry, its notoriously poor working conditions, its enormous water footprint, and the toxic chemicals used to create colors and finishes, and they are keen to make fashion-related decisions to mitigate that harm. In fact, the report found that "choosing unsustainable options now elicits feelings of guilt or shame, while being green gives a euphoric mood boost."

It's more than just a euphoric mood boost; it actually does make a difference. If everyone wore a thrifted outfit to a wedding next year, it would save 1.65 pound of CO2e, which is equivalent to taking 56 million cars off the road for one day. Reselling a dress instead of tossing it reduces its CO2e impact by 79%. By choosing secondhand, you can shrink your own carbon footprint by 527 pounds in a year.

There is potential for this to turn into a positive feedback loop of sorts, where savvy shoppers start buying higher quality items so that they'll retain value and can be resold when the time comes. This in turn has the potential to reduce demand for cheap and shoddily constructed "fast fashion."

Everyone is jumping on the resale bandwagon these days. Major retailers are partnering with thredUP through its new "Resale as a Service" platform to broaden their earnings and spruce up their sustainability credentials. They're offering Clean Out Kits to customers to send in used clothing and earn credits toward thredUP products. As described by Business of Fashion, 

"If I’m a fashion brand right now and see that the resale industry is growing at a rate that’s 21 times faster than the overall fashion industry, I’d be thinking to myself, 'How do I get a piece of this?'"

While online secondhand shopping may not be for everyone, it's exciting to see how well it's doing at a time when so much else is struggling. It offers a straightforward solution to the problems of clothing overconsumption and environmental degradation, while still enabling people to dress well and for less money than they'd spend otherwise. What's not to love about that?

Read the full 2020 Resale Report here.