Resale apparel sales has been the fastest growing segment in the Canadian apparel market for the past three years, says a new report by Trendex.
In 2023, the sale of resale apparel in Canada according to Trendex, increased 13 per cent to C$4.2 billion. The same year the sale of resale apparel in the U.S. according to Thread Up increased 11 per cent to C$71.6 billion, it said.
“A report published this year by Canada’s Value Village documented the importance of both second-hand shopping and the importance of the apparel category for Canadian second-hand retailers.”
Trendex cited the following data on second-hand shopping in general:
- 90 per cent of consumers have either shopped or donated a used item in the past year
- 25 per cent of consumers who have shopped in a second-hand marketplace, shopped for second-hand items monthly
- 84 per cent of consumers say that cost savings is the biggest motivator for second-hand shopping Apparel as a resale category:
- Apparel is the number one item purchased in second-hand stores, followed by books and furniture
- More than 30 per cent of second-hand shoppers report that second-hand apparel makes up nearly 40 per cent of their second-hand purchasing
- 60 per cent of Gen Z consumers say that second-hand apparel makes up a quarter of their wardrobe.
Trendex said a number of factors are driving the above average growth rate for the resale apparel market:
- Economic conditions: Canadian consumers adversely affected by inflation and high interest rates have turned to retailers who offer demonstrable value. Consumers have also identified reselling their apparel as a means to generate revenue.
- Availability: The number of apparel retailers have continued to expand in terms of both their number and accessibility
- Lack of negative stigma: Historically second-hand apparel carried a stigma, but especially in the case of Gen Z consumers, buying used clothing is now seen as “cool”
- Consumers have become concerned about the ecological sustainability of a model in which garments are often worn for less than a half dozen times then discarded. Companies including Nike and lululemon have set up their own apparel resale sites.
- The advent of the internet has facilitated buyers and selling interacting in unprecedented ways. E-commerce based fashion resellers, including ThreadUp Canada and Calgary’s Upside facilitate the resale of apparel on both a national and international level (However resale apparel sales on the internet is one eighth the sales in brick-and- mortar stores)
“From a retailing standpoint, the resale apparel market is fragmented into eight channels of distribution. The most important of the channels include resale brick-and-mortar chains, consignment shops and local thrift/second-hand shops. Value Village with its new boutique stores, indicates that within the largest channel a new sub-upscale segment is developing that could compete with consignment shops. The fastest growing resale apparel channels in 2023 were the branded resale and online apparel resale channels,” said Trendex.
“The two largest apparel resellers in Canada during 2023 were Savers Value Village and the Salvation Army with 159 and 94 stores respectively. Trendex estimates that Value Village’s 2023 apparel sales increased 4.9 per cent to C$430 million,” said the report.
A forecast of the Canadian resale apparel market is dependent on a number of factors, added Trendex:
- The overall performance of the Canadian economy
- The increase in the number of doors and online sites selling resale apparel
- Increased consumer awareness of sustainability. It should be noted that the 2023 market entry and subsequent growth of Shein and Temu, both fast-fashion e-commerce retailers, could conceivably set back efforts to increase sustainability as their apparel is often characterized as disposable
- The supply of better resale apparel
- The number of apparel brands/retailers operating their own resale program . . . ThreadUp is forecasting that the U.S. resale apparel market will increase by 16 per cent in 2024 and by 87 per cent in 2028. Trendex is forecasting that the Canadian resale apparel market will increase by 15 per cent in 2024 and by 69 per cent in 2028.
Trendex said its estimate of growth for the Canadian resale apparel market will be less than that for the U.S. because: the Canadian online resale apparel market is not as developed; the relative importance of Shein and Temu which should limit resale apparel purchases; a lack of resale apparel donations as noted by Canada’s Value Village and the Salvation Army earlier this year.
“It needs to be noted that Winners will undoubtedly be negatively affected as it will increasingly have to share the consumer interested in a “treasure hunt” with the resale apparel sector. The sector will also affect the overall growth rate for all retail apparel sales, at least for now, to an unknown degree,” added Trendex.
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