ReCommerce: The Rise of Resale Commerce and Its Impact on the Retail Landscape

Introduction: The ReCommerce Revolution

In recent years, a new trend has been reshaping the retail landscape: reCommerce. This innovative approach to buying and selling pre-owned items has gained significant traction, especially among younger generations. But what exactly is reCommerce, and why is it making such waves in the industry?

ReCommerce, short for resale commerce, refers to the practice of selling previously owned items through online marketplaces. This concept has evolved from traditional secondhand stores to a digital phenomenon, transforming the way we think about consumption and sustainability.

Recent studies have shown that merchants in the reCommerce industry are growing at an astonishing rate - five times faster than off-price retailers and 20 times faster than the broader retail market. This surge in popularity is particularly evident among Generation Z and millennials, who have embraced reCommerce as a means to both profit from and save money on pre-owned items, especially in categories like apparel and jewelry.

The ReCommerce Market: A Rapidly Expanding Frontier

The growth of the reCommerce market is nothing short of remarkable. Let's take a closer look at some eye-opening statistics:

• Coresight forecasts a 13% annual growth of the U.S. apparel resale market, reaching a staggering $33 billion by 2021.
• Currently, 49% of the U.S. reCommerce industry comprises accessories, clothing, and shoes.
• GlobalData estimates that by 2023, the total worldwide apparel resale market will surge to $51 billion.

These figures underscore the immense potential of the reCommerce industry and explain why so many reCommerce companies are emerging to capitalize on this trend.

Understanding ReCommerce: A New Retail Paradigm

At its core, reCommerce is a business model built around the idea of product reuse. It's a unique retail concept where pre-owned items find new homes through online marketplaces. This shift from traditional brick-and-mortar secondhand stores to digital platforms has revolutionized the resale game, making it more accessible and appealing to a broader audience.

How ReCommerce Works: A Simple Yet Effective Process

The beauty of reCommerce lies in its simplicity. Almost everyone has something of value they can resell, which contributes to the popularity of this model. Here's how it typically works:

1. Sellers identify items they wish to resell.
2. They list these items on reCommerce platforms or send them directly to reCommerce companies.
3. The platforms facilitate the sale, often handling aspects like authentication and pricing.
4. Buyers purchase the items at a discounted price compared to new retail.
5. The platform takes a commission on each sale, while the seller receives the remainder.

Popular reCommerce brands like RealReal, Depop, and Poshmark have streamlined this process, making it easy for anyone to participate in the resale economy.

The ReCommerce Consumer: Who's Buying?

The resale commerce market has found particular favor among millennials and Generation Z. These demographics, comprising individuals under 40, are enthusiastically purchasing high-value second-hand products such as jewelry, shoes, handbags, and clothing. This trend aligns with their values of sustainability, affordability, and unique style.

What Can Be Sold Through ReCommerce?

While the reCommerce model can theoretically accommodate almost any item in good condition, certain categories dominate the online resale market:

• Brand name clothes
• Designer shoes and handbags
• Jewelry
• Vintage products
• Electronics
• Video games
• Home decor items
• Books

The versatility of reCommerce is one of its most attractive features, allowing sellers to monetize a wide range of unused items.

The Benefits of ReCommerce: A Win-Win-Win Scenario

ReCommerce offers a multitude of benefits for sellers, buyers, and the environment alike:

1. Sustainability

By extending the lifecycle of products, reCommerce reduces demand for new production, lowering energy usage, raw material consumption, and textile waste in landfills.

2. Cost Savings

Buyers can access high-quality, often luxury items at significantly discounted prices.

3. Conscious Consumption

ReCommerce encourages consumers to consider the resale value of their purchases, promoting more thoughtful buying habits.

4. Decluttering and Space-Saving

Sellers can clear out unwanted items, freeing up valuable space in their homes.

5. Additional Income Stream

ReCommerce provides an opportunity for individuals and businesses to generate extra income from unused items.

Integrating ReCommerce into Your Online Store

For online retailers, reCommerce presents an opportunity to optimize inventory management and increase revenue. Instead of relying solely on third-party reCommerce platforms, consider these strategies:

1. Create a dedicated reCommerce section on your website for out-of-season or returned items.
2. Offer discounts on these items to clear stock quickly while maintaining profitability.
3. Use cost-effective shipping solutions to keep expenses low and maintain competitive pricing.

By incorporating reCommerce into your existing online store, you can tap into this growing market without sacrificing your profit margins to third-party commissions.

10 Tips for ReCommerce Success

Whether you're an individual seller or an online retailer venturing into reCommerce, these tips can help you succeed:

1. Showcase merchandise with high-quality, varied images
2. Provide detailed, accurate product descriptions
3. Be transparent about item condition and history
4. Offer excellent customer service with quick response times
5. Understand and target your audience effectively
6. Maintain an active social media presence
7. Offer promotions and discounts strategically
8. Ensure prompt order fulfillment
9. Stay informed about current trends and pricing
10. Use attractive, easy-to-track shipping labels

Top 5 ReCommerce Platforms

While ReCommerce on Amazon is an option, several specialized platforms have emerged as leaders in the resale space:

1. Poshmark

A popular platform for fashion and accessories, Poshmark charges a flat rate of $2.95 for sales under $15 and a 20% fee for sales over $15.

2. RealReal

Focused on luxury items, RealReal offers authentication services and operates on a sliding commission scale based on item value.

3. ThredUp

ThredUp simplifies the selling process with its Clean Out kit system, handling the entire resale process for sellers.

4. Vestiaire Collective

Specializing in luxury consignment, Vestiaire Collective takes varying commissions based on sale price, starting at $25 for items under $70.

5. Depop

Popular among younger users, Depop allows sellers to create profiles and manage their own shipping, taking a 10% commission on sales.

Conclusion: Embracing the ReCommerce Revolution

The reCommerce industry is more than just a passing trend; it's a fundamental shift in how we approach retail and consumption. With its projected growth to $51 billion by 2023, reCommerce presents a significant opportunity for both individual sellers and established online stores.

By understanding the mechanics of reCommerce, leveraging its benefits, and implementing effective strategies, businesses can tap into this booming market. Whether you're looking to clear out inventory, offer sustainable options to your customers, or create an additional revenue stream, reCommerce offers a versatile solution.

As we move forward, the line between traditional eCommerce and reCommerce is likely to blur further. Embracing this change now can position your business at the forefront of retail innovation, meeting the evolving demands of conscious consumers while contributing to a more sustainable future.

At FreightAmigo, we're excited about the possibilities that reCommerce brings to the logistics industry. Our Digital Logistics Platform is well-equipped to support businesses venturing into the world of resale commerce, offering efficient shipping solutions that can help maintain competitive pricing in this fast-paced market. As the reCommerce revolution continues to unfold, we're committed to providing the Digital Logistics Solutions needed to thrive in this new retail landscape.