Now that consumers are back on the move, both resellers and department stores are trying to revive sales as consumer spending continues to decline. Department stores are struggling to grab shoppers’ tighter cash as their wholesale model shows its weaknesses. Resale, meanwhile, is growing rapidly but has its own problems: profitability remains elusive given high operating costs – including the limitations of online growth and the logistical difficulties associated with expanding into brick-and-mortar stores. In this tighter context, a tie-up perhaps makes more sense than before.

“The vision has always been that the paths between second-hand and second-hand would cross,” says Charles Gorra, founder and CEO of Rebag. “It’s quite logical – it’s already happening in many other sectors.” (He points to cars, electronics and watches.) Gorra would have liked to have done this earlier, but it took time to reach the level needed to operate in a department store, he says.

Now is the right time. “We have resumed discussions in a post-Covid world,” says Gorra. “Now that companies and department stores are receiving customer inquiries, the market is ready.”

For department stores looking for ways to boost growth, it’s a way to increase footfall and sales. As a fast-growing area of ​​the market, this is attractive to retailers, says Neil Saunders, managing director and retail analyst at Globaldata. And for the resellers, it’s a way to reach more consumers and penetrate (further) into physical retail, with Rebag having more than doubled its footprint. (It has four existing stores; the five Bloomingdale’s concessions make nine.)

“It creates the growth engine that we can use,” says Gorra. “This is just the beginning – a springboard for future openings in the coming months or years.” Bloomingdale’s itself says that at this point it has only committed to the announced locations.

What consumers want

Young consumers’ interest in reselling is well documented. The global secondhand market is expected to grow three times faster than the entire global clothing market by 2027, according to secondhand online platform Thredup, driven by Generation Z consumers.

“This increases the pressure to switch because these generations will ultimately become core customers,” says Gorra.

Jennifer Jones, SVP and General Merchandise Manager for Women’s Accessories at Bloomingdale’s, understands this – hence the partnership. “When we heard and understood that our customers were interested in and looking for pre-owned products, it became an opportunity we wanted to capitalize on,” she says. Danielle Gagola, Innovation Lead at John Lewis, agrees, noting the clear interest in pre-owned items following the store’s foray into fashion rental in 2022.