The ThredUp logo on a smartphone arranged in Hastings-on-Hudson, New York, U.S., on Sunday, Nov. 7, … More
The U.S. fashion resale market contributed $50 billion to the circular economy last year. After increasing 14% in 2024, it grew five times faster than the broader retail clothing and accessories market. And its growth will continue to outpace the primary market this year, projected to increase 12% in 2025 to reach $56 billion, according to ThredUp’s authoritative Resale report.
However, that estimate may be conservative should Trump’s tariffs impact clothing and fashion accessories prices as expected. Some 59% of American consumers said they’d turn to shopping secondhand for clothing and accessories should prices in the primary market go up, according to ReturnPro. And ThredUp’s survey among 3,000+ consumers conducted by GlobalData found the exact same percentage would seek out resale.
The fashion industry’s losses could be the resale market’s gain, since the American Apparel and Footwear Association estimates that upwards of 97% of the clothing and shoes sold in the U.S. are imported and will be subject to tariff duties.
Adjusting To Price Increases
An analysis conducted by Trade Partnership Worldwide LLC for the National Retail Federation found that an $80 pair of jeans before tariffs could cost $10 to $16 more after, a pair of $90 sneakers could increase to between $106 and $116 and the price of a $119 women’s purse could rise by $15 to $26. The price increases are based upon proposed tariffs in the 10% to 20% range, with higher tariff rates for China factored into calculations.
Already, U.S. consumers are making adjustments. ThredUp reported fourth-quarter revenues ending December 31 rose 9% and The RealReal, which trades in the luxury end of resale, posted 14% growth in fourth quarter, breaking a company record.
Further, a new report from Mastercard found that secondhand fashion is taking a bite out of luxury brands’ revenues. Some 27% of online luxury spending in 2024 went toward secondhand fashion purchases, according to its tracking data, and that share is expected to rise to 29% in 2025.
Since industry analysts expect the personal luxury market to decline in 2025 after retreating 2% last year, luxury brands are starting to feel the pain from resale. For example, while Kering-owned Gucci sales dropped 25% in the first quarter, Vestiarie Collective reported Gucci was the best-selling brand on its resale platform in the same period.
Yet it’s not just luxury customers looking to the circular fashion market. “While circular-fashion shoppers have primarily focused on the luxury space, mass apparel is trending up as well,” Mastercard reports, noting that in the first quarter 2025, spending on secondhand fashion rose in the mass market as well.
“Rising tariffs can complicate global trade and increase the difficulty and expense of accessing new products, which may also accelerate the adoption of the circular economy,” it suggests.
Retailers across the resale market, including thrift stores, non-profits, like Goodwill, and online secondhand retailers, are ready to take advantage of the increasingly chaotic market created by tariffs.
Shielding Fashion Brand Revenues
The NRF/Trade Partnership World analysis calculates that the apparel industry may lose between $16 billion to $18 billion in net revenue should the proposed tariffs go into effect. The footwear market could face between $4 billion and $8 billion in lost revenue and the handbag, wallet, backpack and tote bag market, broadly defined as travel goods, could be on the hook for $2 billion to $3 billion in losses.
As fashion industry executives prepare to take a hit in the primary market, it is causing them to think twice about resale as a viable channel. Some 54% of 50 fashion executives surveyed by ThredUp said resale offers a “more stable and predictable” source for clothing as tariffs roll in.
Currently, ThredUp reports that some 150 major fashion brands participate in branded recommerce, using tools such as ThredUp’s resale-as-a-service platform. And 76% of retail executives surveyed who don’t offer resale are considering getting in on it.
Consumers applaud the opportunity to shop from both new and used fashion on the same platform. Nearly 50% of consumers are more likely to make a first time purchase if they are offered shopping credit to trade in used apparel. And the fact that a brand supports resale testifies to its confidence in the quality and value of its products.
“Resale can be a hedge against tariffs and resulting supply chain disruptions,” shared ThredUp’s chief strategy officer Alon Roten, and noted that 80% of fashion executives expect supply chain disruptions. He also added that 94% say their customers are already participating in resale. “Resale-as-a-service is one way fashion brands can bridge the gap.”
Ready, Set, Resale
ThredUp reports that a record 58% of shoppers bought secondhand in 2024, up six percentage points from 2023, with resale’s appeal even greater among next-generation shoppers, reaching 68% penetration.
Resale is increasingly perceived as a more responsible way to buy clothes. Not only does it offer a price break, some 49% of consumers report they have cut back on buying cheap, lower-quality brands, preferring to purchase new items that will hold their resale value.
“Resale is a domestic supply chain,” ThredUp’s Roten concluded. “All the clothes we sell come from the closets of American consumers. So we are an outlier in the retail industry where our supply is immune from tariffs. Resale could actually be the rare bright spot in a trade war because it is a domesticated supply chain.”
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