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US secondhand market may double in 5 yrs, reach $77 bn: study

26 Jun '21

3 min read

Pic: Shutterstock

The US secondhand market share is expected to grow by 9 points over the next 10 years, more than any other sector, and that market is projected to double in the next five years, reaching $77 billion, according to a comprehensive study conducted by retail analytics firm GlobalData and released by ThredUp Inc., a US-based online resale platform for women's and kids' apparel, shoes and accessories.

The US resale sector grew during the pandemic and is projected to accelerate in the recovery. Secondhand is now a $36-billion market in the country and resale, an emerging growth channel for apparel retailers, is expected to grow 11 times faster than retail clothing over the next five years. Secondhand is displacing fast fashion, new clothing purchases and harmful production as consumers switch to thrift, the study found.

The study behind the 2021 Resale Report surveyed 3,500 consumers and reveals new insights on tailwinds propelling resale in the pandemic recovery and the role of government in accelerating the adoption of circular fashion.

"We are in the early stages of a radical transformation in retail. Consumers are prioritising sustainability, retailers are starting to embrace resale, and policymakers are getting on board with the circular economy. Pollutive industries have the power to transform when technological innovation collides with the motivations of consumers, businesses and government. We've seen it with electric cars and solar energy, and we believe circular fashion is next," James Reinhart, co-founder and chief executive officer of thredUP, said in a press release.

In 2020, 33 million consumers bought secondhand apparel for the first time, and 76 per cent of those first-time buyers plan to increase their spend on secondhand in the next five years. Consumers and retailers want the government to step in to incentivize resale.

Fifty eight per cent of retail executives say they would be more likely to test apparel resale if there were financial incentives for doing so. Forty four per cent of consumers think the government should help promote sustainable fashion, while 47 per cent say they would be more inclined to purchase secondhand clothing if there was no sales tax or they received a tax credit.

Sixty two per cent of retail executives say their customers are already participating in resale, and 42 per cent of retail executives say resale will be an important part of their business in the next five years.

Forty three per cent of consumers say they are more likely to shop with a brand that lets them trade in old clothes for brand credit, and 34 per cent say they are more likely to shop with a brand that offers secondhand clothing alongside new.

Resale is expected to be more than twice bigger than fast fashion by 2030, with 2 in 5 thrifters saying they're replacing fast fashion purchases with secondhand clothing.

In the past decade, 6.65 billion items of apparel have been recirculated via the secondhand market. Consumers have saved $390 billion by buying secondhand.

Fibre2Fashion News Desk (DS)

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