Secondhand stores are poised to benefit if US tariffs drive

TRADE WARS

People work amid boxes of returned or overstocked clothing, shoes, boots, coats, packs and other items in a warehouse where the goods are cleaned or repaired before they are marketed on resale platforms in Englewood, Colo., on Thursday. DAVID ZALUBOWSKI — THE ASSOCIATED PRESS

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By Anne D’innocenzio

The Associated Press

NEW YORK >> Stores selling secondhand clothes, shoes and accessories are poised to benefit from President Donald Trump’strade war even as businesses the world over race to avert potential damage, according to industry experts.

American styles carry international influence, but nearly all clothing sold domestically is made elsewhere. The Yale University Budget Lab last week estimated short-term consumer price increases of 65% for clothes and 87% for leather goods, noting U.S. tariffs “disproportionately affect” those goods.

Such price hikes may drive cost-conscious shoppers to online resale sites, consignment boutiques and thrift stores in search of bargains or a way to turn their wardrobes into cash. Used items cost less than their new equivalents and only would be subject to tariffs if they come from outside the country.

“I think resale is going to grow in a market that is declining,” said Kristen Classi-Zummo, an apparel industry analyst at market research firm Circana. “What I think is going to continue to win in this chaotic environment are channels that bring value.”

The outlook for pre-owned fashion nevertheless comes with unknowns, including whether the president’s tariffs will stay long enough to pinch consumers and change their behavior. It’s also unclear whether secondhand purveyors will increase their own prices, either to mirror the overall market or in response to shopper demand.

Jan Genovese, a retired fashion executive, sells her unwanted designer clothes through customer-to-customer marketplaces such as Mercari. If tariffs cause retail prices to rise, she would consider high-end secondhand sites.

“Until I see it and really have that sticker shock, I can’t say exclusively that I’ll be pushed into another direction,” Genovese, 75, said. “I think that the tariff part of it is that you definitely rethink things. And maybe I will start looking at alternative venues.”

The secondhand clothing market already was flourishing before the specter of tariffs bedeviled the U.S. fashion industry. Management consulting firm McKinsey and Co. predicted after the COVID-19 pandemic that global revenue from pre-owned fashion would grow 11 times faster than retail apparel sales by this year as shoppers looked to save money or spend it in a more environmentally conscious way.

While millennials and members of Generation Z were known as the primary buyers of used clothing, data from market research firm Sensor Tower shows the audience may be expanding.

The number of mobile app downloads for nine resale marketplaces the firm tracks — eBay, OfferUp, Poshmark, Mercari, Craigslist, Depop, ThredUp, TheRealReal and Vinted — increased by 3% between January and the end of March, the first quarterly gain in three years, Sensor Tower said. The firm estimates downloads of the apps for eBay, Depop, ThredUp and The RealReal also surged compared to a year earlier for the week of March 31, when Trump unveiled since-paused punitive tariffs on dozens of countries.

Circana’s Classi-Zummo said that while customers used to seek out collectible or unusual vintage pieces to supplement their wardrobes, she has noticed more shoppers turning to secondhand sites to replace regular fashion items.

“It’s still a cheaper option” than buying new, even though retailers offer discounts, she said.

Poshmark, a digital platform where users buy and sell pre-owned clothing, has yet to see sales pick up under the tariff schedule Trump unveiled but is prepared to capitalize on the moment, CEO Manish Chandra said.

Companies operating e-commerce marketplaces upgrade their technology to make it easier to find items. A visual search tool and other improvements to the Poshmark experience will “pay long dividends in terms of disruption that happens in the market” from the tariffs, Chandra said. Archive, a San Francisco-based technology company that builds and manages online and in-store resale programs for brands including Dr. Martens, The North Face and Lululemon, has noticed clothing labels expressing more urgency to team up, CEO Emily Gittins said.

“Tapping into all of the inventory that is already sitting in the U.S., either in people’s closets or in warehouses not being used,” offers a revenue source while brands limit or suspend orders from foreign manufacturers, she said.