Tag Archives: resale

How to make a circular fashion business | Instant News

Until 2013, Charlotte Staerck worked in the pharmaceutical field for NHS and her husband Ben, run a furniture restoration business. When customers started coming to Ben’s business with their dilapidated or broken designer bags, Charlotte had the idea for us the same skills to make. Handbag Clinic, is now the leading luxury handbag restoration service.

The clinic has now fully adopted a sustainable mode business model; buy, restore, and sell luxury handbags. It has global customers, three brick and mortar stores and has seen 500% growth in online sales during the lockdown.

Here, Charlotte Staerck, its CEO, shares her advice on creating a fashion business in a circular economy and why restoration is the future of luxury.

Sustainability must be at the core of the business

“If you are determined to have sustainable business then you need to make sure that every part is as compact as possible. We are always looking for as many solutions as we can. You have to think about how you are going to take out the trash? What products do you use? Whether you make sure that you reduce that waste all the time, you really have to think things through from that sustainable perspective to keep the core values ​​alive in the business. “

Celebrate expertise

“One of the best things about our business is how much it values ​​expertise. A lot goes into bag restoration and it’s an impressive craftsmanship. One of our main values ​​is preserving the past, while attentively rediscovering the future and this is very much about preserving these techniques, keeping this craft alive. If you choose a business like this, you can engage young, passionate people who will get ahead and most importantly – remember our business the current political climate– Create unique skills that are highly UK based. We have people send us goods from all over the world. We are always developing and supporting these techniques for handling specialist bags. We’ve created new products and new dyes and dyes to do it. I think it’s a really amazing thing to see. “

The circular fashion economy is the future…

“I have always subconsciously used this circular fashion ethos since I was very young. When I was 16, I would save up to buy a handbag, then I would sell that handbag and buy what I thought was the next big handbag. I just did that on Ebay! But now I see that this way of thinking is the future of luxury fashion.

We want to extend the life cycle luxury bag overall. We don’t want you wrecking your handbag and dropping in and see us, we always say let’s try and avoid you even getting to that point in the first place. It’s about protecting the investment this expensive handbag has to offer, from the moment you buy it. We don’t only offer a resale platform, we also offer a resale platform that also increases the value of your bag. More and more people think this way, it’s not about hoarding new things but about appreciating old things and keeping them longer, or trading them for something else. This is a good financial investment. You can play the handbag market like the stock market and it’s sustainable at the same time! “

… But used fashion needs the right kind of marketing.

“Back then when I was going to buy and sell used bags, it wasn’t all that glamorous. I think that’s all changing now, with things like the collective Vestiare and the Handbag Clinic. There was a real reaction to fast mode, so now, good quality, pre-loved high fashion starting to look a lot fancier. We try and make pre-loved shopping feel that way, and of course we do with our brick and mortar shop too. We will have very wealthy people happily shopping there when they can buy new ones! Ethical and guilt-free clothing is definitely looking more glamorous now. ”

Make luxury easily accessible

“One of the great things about what we do is that we often offer luxury handbags at lower prices, making them accessible to new income earners. This is a key factor of the circular fashion ethos- rental and resale market– it really democratizes fashion and makes it a very attractive business model. “


Always do your research

“When it comes to luxury materials, it is extremely important that you do your research properly. You really have to not jump on both feet, but spend a lot of time doing your research and making sure you know what you’re getting into to get started. We have horror stories about people who go to companies unprepared. One girl brought £ 40,000 worth of Birkin to someone who was just starting out in the industry, and they really ruined it. You have to really know your stuff. ”

Do one thing, do well.

“For us, because we specialize in handbag restoration, we thought it wise not to expand it. This is great advice for anyone looking to do something similar. The skills required for this type of job are very specific and customers need to be convinced that you are an expert in your field. ”

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How the next generation of fashion resale took shape | Instant News

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For the last six months, the platform used online Thredup, Poshmark and StockX has filed for megawatt IPOs, reaching valuations of $ 1.3 billion, $ 3.8 billion and $ 7.5 billion, respectively. The growing wave of startups looking to step in, are using white label technology, digital passports, and a combination of lease and resale to differentiate themselves.

The tough task is deciphering which offering to stick with. The online resale market is highly fragmented and dynamic, with new players coming in looking for growth based on shifting consumer trends, and established players raising additional funds through external investment or IPO, notes Sarah Willersdorf, head of global luxury at the Boston Consulting Group. Winners and losers will emerge in the next three to five years during which period the used goods sector, currently valued at $ 30-40 billion worldwide, is expected to grow 15-20 percent.

Luxury brands shouldn’t sit aside, says Willersdorf. “Brands should explore options such as selling used goods themselves, developing their own resale platforms, instituting buyback programs, and partnering with existing resale platforms to leverage outside expertise,” he said. Boston Consulting Group research shows that 62 percent of consumers will buy more from fashion brands that partner with second-hand players. “The bottom line for brands is that markets that were previously owned will remain,” said Willersdorf.

Fashion CEOs prefer to participate with some control over their brand representation, said Sarah Smith, a partner at Bain Capital Ventures, which has invested in the resale of the startup Archive. “What’s most surprising to many is that reselling can drive greater customer loyalty for the brand, rather than cannibalizing sales.”

Why aren’t there more luxury brands investing in resale? Andy Ruben, CEO of white label resale platform Trove, which supports resale for sustainability-conscious brands including Patagonia and Eileen Fisher, says this boils down to perceived risk, which is rapidly diminishing. “Luxury brands are good at strategy but they don’t want to be first. Currently, they are watching and studying. In the next few years, we will see the luxury players get it right. “

The emergence of resale that is integrated with the brand

Integration is one option. “Keeping used platforms, brands and retailers hidden has driven inefficiencies on all sides,” said Stephanie Crespin, founder and CEO of Reflaunt, one of many startups. their white label resale technology. Reflaunt’s modulable features include broadcasting resale lists to up to 24 global markets to promote quick sales, offering store credit to customers instead of cash, and digitizing physical purchases for luxury brands that are slower to adopt e-commerce via in-house resales. store. drop-off scheme. It is part of La Maison des Startups LVMH and its clients include Balenciaga and Cos.


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Thredup, now public, wants to break the resale technology for fashion brands | Instant News

Thredup, now a public company, is looking to build a resale technology solution for brands alongside its customer markets.

Thredup raised $ 168 million with a market value of $ 1.3 billion in an initial public offering (IPO) on Friday. Its stock jumped from $ 14 to $ 20. With 1.24 million active buyers, 428,000 active sellers, and $ 186 million in revenue in 2020, it’s not profitable yet. But Thredup, which keeps inventory from sellers, is betting that its white label technology could help not only the brand but its own profitability.

Competition in resale has surged in the past year, with increasing industry attention to the second-hand market, due to its relevance among younger customers, substantial growth and sustainability metrics. Thredup is the second resale company to go public this year, afterwards IPO January Poshmark and RealReal in 2019. Paris-based Vestiaire Collective created a A $ 216 million deal with Tiger Global Management and luxury conglomerate Kering, which takes a 5 percent stake. The resale market is expected to reach $ 36 billion by 2024, representing a compound annual growth rate of 39 percent since 2019, making it the fastest growing sector in retail, according to a January 2020 survey from GlobalData.

But while luxury brands may want more revenue from and control their brands in the secondary market, they are less willing and unable to spend 10 years and hundreds of millions of dollars investing in the robust infrastructure and technology needed to support them, says Neil Saunders, managing director of GlobalData’s retail division. As such, they are increasingly considering partnering with technology platforms, flooded with VC cash and scale-dependent, for branded “white label” resale technology from a customer-facing perspective.

“Brands want to play on the resale, but it is difficult to allow resale on a large scale and get the unit economy to work at a lower price point,” said Ainslee Withey, managing director at Barclays Investment Bank, which is an underwriter for Thredup’s IPO. Among the technological challenges are the ability to predict the ideal resale price, the ability to automate unique and unpredictable inventory orientation, and the ability to make personalized recommendations from a multitude of unique items. Because of this, he said, “There are clear partnership opportunities with resale technology platforms. And once they reach a certain scale, they can grow exponentially. “


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Thrift stores and sustainable fashion outlets thrived during the pandemic | Instant News

Although the COVID-19 pandemic changes how such storage can operate, Goodwill locations and small shops have regained their footing in recent months. About 16% to 18% of Americans indicate they will shop at a thrift store at some point during a given year, according to an August 2020 report by the Association of Resale Professionals, the largest trading group for retailers. Economic pressures and job losses during the pandemic are increasing the demand for used goods as well.


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Used clothing: Luxury label ‘future is in buyers’ wardrobe | Business | Economic and financial news from a German perspective | DW | Instant News

“There’s always the sensation of finding something really cool, something you’ve always wanted but never been able to afford. Suddenly, it pops up on your screen,” Antonia Barthel told DW. A 27-year-old from Munich perusing high-end resale platforms every week, hunting for second-hand luxury clothing.

It was customers like him that caused fashion labels to reconsider their stance on the resale sector. Earlier this month, Kering, the luxury giant that owns brands such as Gucci, Alexander McQueen and Balenciaga, acquired a 5% stake in France’s high-end resale platform, Vestiaire Collective. Resale market previously shunned by luxury fashion houses, which were careful to give up control over the distribution, prices, and perception of their goods. Dry Investment could signify a wider pivot towards resale in the industry.

Francois-Henri Pinault, chairman and CEO of Kering, said in a statement: “The former luxury is now a real and deeply entrenched trend.”

Preloved: Image transformation

The image of shabby, used clothes gradually faded. Preloved is the new motto of many young fashionistas.

“I never cared if it had been worn before. It felt new to me,” said Barthel.

The fact that glossy no longer has to mean new is “just a contemporary approach for fashion designers,” Max Schönemann, CEO of German luxury fashion resale platform Rebelle, told DW.

Resale is on the rise

While the fashion industry is projected to suffer the biggest financial hit in decades during the pandemic, the resale industry is booming. Through resale platforms such as Vestiaire Collective and Rebelle, consumers are selling unwanted clothing directly to other consumers online. Vestiaire Collective grew by more than 100% in the last year. 140,000 new items are now uploaded to the platform every day.

“The last few months have been the best in the history of our business,” Rebelle’s Schönemann told DW.

Resale platforms are hugely popular with millennials and Gen Z., which are more economical and focus more on sustainability than the legacy consumer segment. By ignoring the used goods industry, luxury fashion brands have missed the opportunity to attract a large market.

The current investment in Kering is aimed at “recruiting future customers,” Citigroup’s Thomas Chauvet told DW.

Chauvet points out that collaborating with resale sites is also a way to collect data on consumer shopping behavior and brand desires.

GenZ is adopting secondhand fashion more quickly than any other age group

Affordable Luxury

Affordability is a key driver of sales of used luxury goods.

“I wouldn’t buy a Chloé handbag in a store, but I recently bought a used handbag online,” says Barthel.

This 27 year old man prides himself on having a high quality bag that has become a staple in his wardrobe. The exorbitant price tag means buying a luxury handbag is a distant dream for most consumers. The resale sector has brought it within reach.

The pandemic has accelerated the trend towards affordable designer fashions: About half of millennial and Gen Z adults have seen income decline since the onset of the coronavirus crisis.

By partnering with resale players, luxury brands such as Alexander Mcqueen, Gucci and Burberry are slowly trying to build loyalty with younger customers amid the pandemic’s slump. This collaboration hints at a growing attitude in the luxury sector, which welcomes frugal consumers.

“Luxury brands want to maintain a constant dialogue with clients, both through direct channels and on alternative platforms,” ​​said Chauvet.

In an effort to reach out to resell consumers and prevent counterfeiting, Alexander McQueen is partnering with Vestiaire Collective’s new “Brand Approved” service. In a first of its kind collaboration, McQueen collects second-hand goods from in-store customers in exchange for store credits. The items are then authenticated by the fashion house, sent to the Vestiaire Collective and sold online with a special approval note.

Antonia Barthel wearing Chloe's handbag

Antonia Barthel from Munich was able to buy a high-end brand thanks to the resale platform

Sustainability is in vogue

While Antonia Barthel loves used goods, frugality is not her initial motivation to shop for used clothes. “Sustainability plays an important role for me. I usually don’t really care about brands,” he said.

The number of Millennials and Gen Z supporting sustainable products more than doubled between 2019 and 2020, according to Pricewaterhouse Cooper (PwC).

“The trend for sustainability has grown more rapidly during the pandemic,” PwC’s Erika Andreetta told DW.

Circular fashion model, which keeps products and materials used for as long as possible through reuse and recycling, is no longer just a keyword. As luxury players seek to increase their sustainability credentials, participating in the luxury resale sector will be essential.

“Luxury brands basically have no choice. They understand that sustainability will be the key for them moving forward. Resale is an important part of sustainability,” Clara Chappaz, head of business for Vestiaire Collective, told DW.

The infographic shows the growing share of the used goods market

Used goods are expected to claim the second largest market share after off-prices, while department stores are expected to lose market share

Chanel and Hermès charted another route

Despite the promises held by the resale sector, Dry’s pivot towards resale remains far from universal. Fashion houses like Hermès and Chanel are still against selling even their most iconic leather goods online, let alone partnering up with resale parties.

For these more traditional-minded homes, the resale revival continues to feel like losing control of things. Chanel is currently engaged in a lengthy court battle with resale platform The RealReal, accusing fake advertising and selling fake bags. The iconic fashion house claims that its shop is the only place eligible to sell genuine Chanel.

“The brands that may be more reluctant to accept the resale market are those that are positioned very exclusively and exercise tight control over distribution and pricing,” Chauvet said.

However, Chauvet hopes the brand won’t be able to stay in the resale sector for much longer. “I think the trend will be strong enough for everyone to embrace it and work together,” he said. Dry Investments will likely be the first of many luxury fashion races into the resale sector.


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