Will the Resale Market Explode?

How Tariffs Could Change What We Buy

The secondhand clothing market has (not so) quietly become a retail powerhouse, growing at a rate that would make traditional retail execs envious. Currently valued at approximately $43 billion in the United States alone, the resale segment was already projected to more than double by 2027, and that was before new economic pressures entered the equation. According to ThredUp's 2024 annual report, the U.S. secondhand market is expected to reach $73 billion by 2028 (!!), growing at 11% annually on average. While platforms like ThredUp, Poshmark, eBay and The RealReal have been steadily claiming market share for years, we're approaching an inflection point that could dramatically accelerate this trajectory.

As import costs rise and consumer prices follow, shoppers are being forced to reconsider their relationship with clothing. The era of Fast Fashion is giving way to a more calculated approach to wardrobe building. This shift isn't just changing where consumers shop; it's transforming what they value in their purchases and how brands must respond beyond the trends.

The coming years will witness not just the continued rise of resale platforms but the renaissance of interconnected economies around repair, repurposing, and circular consumption. For brands and retailers, this isn't merely a competitive threat—it's potentially the most significant opportunity to reimagine their business models since the advent of e-commerce and DTC.

The Perfect Storm for Resale Growth

The secondhand market was already on a growth trajectory that outpaced traditional retail before economic headwinds intensified. This expansion has been driven primarily by millennial and Gen Z consumers, who approach shopping with fundamentally different values than previous generations. Not just according to research but anecdotally over social media, younger shoppers value sustainability and the circular fashion economy as it aligns with their values of reducing waste and carbon footprint. According to Capital One’s research, the majority of resale customers are millennials, with Gen Z representing the fastest-growing demographic segment. Notably, upper-middle-income consumers ($75-150K annually) are surprisingly active in luxury resale, demonstrating that second hand consumption transcends economic necessity.

What makes the current moment particularly strong for resale growth is the convergence of multiple factors. Rising import costs are forcing brands to increase retail prices, widening the value gap between new and secondhand items. When a new premium denim product priced at $150 jumps to $180-200 due to tariff impacts, the psychological barrier to purchase strengthens considerably. Meanwhile, the same jeans on a resale platform might remain at $70-90, making the value proposition increasingly compelling.

The biggest lesson I took from my MBA studies is that perceived value, not price, drives purchasing decisions. We see this online all the time, with consumers constantly describing their discretionary purchases as “needs.” And as “first-hand” (aka new products from brands) retail prices climb, consumers become more deliberate in their choices, seeking items with longer potential lifespans and stronger resale potential. This mindset shift benefits the secondhand market in two critical ways: 

1. It increases supply as consumers become more likely to sell items they no longer use

2. It grows demand as shoppers look for alternatives to higher retail prices.

The demographic footprint of resale is also expanding beyond its early adopters. While urban millennials initially drove the market, we're seeing growth among suburban families, Gen X professionals, and even baby boomers discovering platform-based resale for the first time (hello Facebook marketplace). This broadening appeal suggests the secondhand market is transitioning from a niche solution to a mainstream alternative, and clearly one that tariff pressures will only accelerate as time goes on.

Historical precedent supports this trajectory. During previous economic pressure points, including the 2008 recession and the 2018-2019 tariff implementations, secondhand clothing sales saw notable upticks as consumers sought value alternatives. The difference today is the existence of sophisticated platforms like the RealReal, Vinted and Vestiaire Collective that have normalized the resale experience plus the rise of “vintage” as a badge of honor all point to removing much of the friction that once limited the market's potential.

The Platform Evolution

The digital platforms facilitating resale are positioning themselves for explosive growth through strategic investments in technology, logistics, and user experience. ThredUp's infrastructure now processes over 17 million items annually. These platforms aren't merely scaling existing operations—they're fundamentally reinventing how secondhand goods move through the market.

Authentication technology represents one of the most significant evolutionary areas. What began as manual expert verification for luxury items that the RealReal is known for, authentication is transitioning to AI-assisted systems capable of identifying subtle markers of authenticity across brand categories. These innovations are particularly crucial as resale expands beyond easily recognizable luxury products into mid-market segments where counterfeit detection becomes more challenging but equally important for consumer confidence.

The logistics infrastructure supporting these platforms has also matured considerably. Processing centers now employ advanced sorting technologies, condition grading algorithms, and dynamic pricing models that maximize efficiency while ensuring appropriate valuation. This sophistication allows platforms to handle unprecedented volume while maintaining quality standards—a necessity for capturing the influx of inventory that economic pressures will generate.

Platform business models are diversifying as well. Beyond the peer-to-peer marketplace model pioneered by eBay and refined by Poshmark, we're seeing managed marketplaces like ThredUp handle the entire selling process on behalf of consumers. Specialized platforms focusing on particular product categories, like StockX for sneakers or Goat for limited-edition apparel, have developed authentication processes tailored to their unique markets. This specialization creates a more refined user experience while addressing category-specific challenges.

The competitive landscape continues to evolve through both consolidation and new entrants. Etsy's acquisition of Depop for $1.6 billion signaled the mainstream investment community's confidence in resale growth, while venture capital continues to flow into specialized platforms targeting underserved market segments. This dynamic environment ensures continued innovation while providing multiple paths for consumer participation.

As tariff pressures increase first-hand retail prices, these platforms stand ready to absorb increased demand with scalable systems built specifically for this moment. The question isn't whether they can handle growth—it's how quickly they can expand their infrastructure to meet the coming surge in both supply and demand.

Retailer Integration

Traditional retailers and brands are increasingly recognizing that resale represents not just competition but opportunity. Rather than fighting against the secondhand market, forward-thinking companies are developing strategies to participate in and profit from this growing segment. This integration takes several forms, each representing different levels of commitment and control.

Brand-owned resale programs exemplify the most direct approach. Patagonia's Worn Wear program, one of the pioneers in this space, offers store credit for returned items that are then refurbished and resold through dedicated channels. This model allows Patagonia to maintain brand control while capturing additional revenue from each item. Levi's SecondHand similarly buys back the brand's jeans and resells them on a dedicated platform, effectively extending the brand relationship through multiple ownership cycles.

For retailers lacking the infrastructure to manage resale independently, strategic partnerships offer an alternative. Macy's partnership with ThredUp in 2019 placed secondhand sections in select department stores, bringing new foot traffic while offering consumers a curated resale experience. These arrangements allow traditional retailers to participate in the resale economy without building systems from scratch—an increasingly attractive proposition as economic pressures intensify competition for consumer dollars.

Luxury brands have developed more nuanced approaches to authorized resale. Gucci's partnership with The RealReal involves authentication cooperation that benefits both parties: Gucci gains influence over how its products appear in secondary markets, while The RealReal receives authentication support that enhances consumer confidence. These collaborations represent a significant shift from the historically adversarial relationship between luxury brands and resale platforms.

New business models are emerging at the intersection of traditional retail and resale. Rent-to-resell programs like Nuuly allow consumers to temporarily access products before either purchasing or releasing them back to the platform. Subscription models incorporating both new and secondhand items create recurring revenue while addressing different consumer preferences. These hybrid approaches demonstrate the blurring boundaries between first and secondhand markets.

As retail prices climb due to economic pressures, these integration strategies will become increasingly attractive to brands seeking to maintain market share and customer relationships. The distinction between "new" and "used" retail will continue to blur, creating a more fluid marketplace where items move through multiple ownership cycles within brand-controlled ecosystems.

Material Engineering Across the Three Tiers

As the resale economy expands, it’s beginning to reshape not only how garments are sold and I believe we will start to see a shift on how products are made. Based on my experience in textile development, I believe brands will increasingly need to engineer products with resale, repair, or recycling in mind. This shift invites a new materials strategy: designing garments to fit into one of three emerging tiers—Resale-Ready, Repair-Ready, and Recycling-Ready.

1. Resale-Ready Materials

   At the top tier, materials are engineered to retain performance and value across multiple ownership cycles. This begins with structurally robust natural fibers, maybe with high-spun yarns that resist pilling and preserve fabric surface over time. Fabric constructions focus on longevity—multi-ply yarns, dense weaves, and abrasion-resistant structures are prioritized for their ability to withstand extended use.

   Durability testing becomes essential in this tier. Standardized methods like abrasion, tear, and colorfastness testing validate performance claims. Finishes and dyes are selected for their ability to maintain appearance through repeated laundering. Every choice is made with long-term usability in mind—supporting secondhand resale as a viable part of the garment’s lifecycle.

2. Repair-Ready Materials
   The repair-ready tier emphasizes practical durability with products designed for everyday wear but also for easy maintenance, repair, and alteration. Yarn blends are selected to balance resilience with flexibility, and fabric weights are chosen to support both comfort and reinforcement.
   Materials in this category often feature strategic reinforcements at high-stress zones such as fiber blends or denser weaves at pockets, knees, or seams. Color palettes are selected to accommodate subtle repairs, minimizing contrast when garments are patched or re-stitched. Mechanical finishes are limited to preserve fiber integrity, ensuring that garments can be altered or mended without compromising performance.

3. Recycling-Ready Materials
   At the base tier, materials are designed to move cleanly into circular systems. Mono-material fabrics reduce friction in recycling streams, and biodegradable stretch alternatives prevent contamination. Simplified fiber blends, minimal chemical inputs, and recyclable-friendly dye systems all contribute to more seamless end-of-life processing.
   Finishes are chosen with future breakdown in mind—free of PFAS, PFCs, and other persistent chemicals. Solution-dyeing and low-impact color techniques enhance recyclability by minimizing chemical residue. In this tier, material choices are guided not just by price or aesthetics, but by how efficiently a product can be reclaimed, remade, or responsibly decomposed.

How Consumer Preferences Will Shape Production

Consumer awareness around product longevity is rapidly evolving beyond simplistic quality assessments. Today's shoppers are developing increasingly sophisticated understanding of the features that determine resale value, repairability, and long-term performance thanks to social media. These shifting preferences aren't just influencing purchasing decisions—they're reshaping production priorities across the industry.

Features that consumers now value reflect this longer-term perspective. Natural fiber content, particularly in categories where performance matters, commands growing premium. Visible quality markers like French seams, bound edges, and reinforced stress points signal durability worth paying for. Construction details that facilitate repairs or alterations, such as generous seam allowances and accessible component design, can increasingly influence purchase decisions.

Brands are responding to these preference shifts by highlighting longevity features in their marketing. Product descriptions now emphasize material specifications that previously remained hidden in technical documents, like A&F listing the GSM weight of their mens’ tee jersey fabrics. Durability testing results, once used primarily for internal quality control, now appear in consumer-facing content. Guarantees and warranty programs that were once afterthoughts have become central selling propositions.

The "Built for Resale" product design approach represents the most comprehensive response to these changing preferences. This philosophy integrates resale considerations from initial concept through material selection, construction, and even packaging. Designs emphasize timeless elements over trend-dependent details, while engineering focuses on maintaining structural and aesthetic integrity through multiple ownership cycles. These products command premium pricing justified by extended usable lifespan and stronger resale value retention.

These evolving preferences create cascading effects through production decisions. Pattern makers allocate additional material to create more generous seam allowances that facilitate alterations. Component selection prioritizes replaceability over marginal cost savings. Color development considers long-term performance alongside seasonal trend alignment. These subtle shifts represent fundamental changes in production philosophy, from designing for initial sale to engineering for extended product lifespan.

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The confluence of economic pressures and evolving consumer values is creating unprecedented momentum for the resale economy and its adjacent markets in repair and repurposing. What began as niche consumer behavior has developed into a sophisticated ecosystem poised for explosive growth as tariff-driven price increases reshape retail dynamics.

For consumers, this transformation offers both challenges and opportunities. Higher initial purchase costs for new items will strain budgets, but the expanding secondhand market provides compelling alternatives. Those who develop material literacy and quality assessment skills will navigate this changing landscape most successfully, making informed decisions about when to buy new, when to repair, and how to maximize the value of their wardrobe investments.

For brands and retailers, the strategic imperative is clear: develop business models that capture value across multiple ownership cycles rather than focusing exclusively on initial sales. Those that embrace resale integration, repair services, and longevity-focused design will find growth opportunities even as traditional retail models face increasing pressure. Companies that resist this shift, continuing to produce disposable products in a non-disposable price environment, risk obsolescence.

As we look toward the future of apparel consumption, one thing becomes increasingly clear: the linear "buy, use, discard" model that dominated recent decades is giving way to something more circular, more deliberate, and ultimately more sustainable, and I don’t mean environmentally but long-lasting. The question isn't whether the resale market will grow, but how quickly traditional retail will adapt to this new reality.

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🧵 Join the Conversation
Are you shifting your own buying habits toward resale or repair? If you work in fashion, have you seen these platforms reshape the landscape for your team or brand? Comment below!

🔜 Up Next
Next week, I’ll be breaking down how brands are actually shifting their sourcing strategies in real time and how fabric is at the center of those changes.

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Note from past Carmen —I hope to break down this post to dedicated letters in the future, especially since I cut a big section about how I have big hopes for the repair economy and the come back of skilled workers within this realm. Truly so much to talk about in this space! We will for sure revisit this in the future :)