The secondhand apparel market is booming, with US consumer spending expected to reach a staggering $73 billion by 2028, according to the ThredUp 2024 Resale Report. In this burgeoning landscape, ThredUp has emerged as a popular platform for buying and selling pre-owned clothing. But is selling on ThredUp actually worth it? Let’s take a deep dive into the pros and cons, payout structure, and tips for maximizing profit to help you decide if it’s the right platform for you.
Table of Contents
- Understanding ThredUp’s Payout Structure
- Pros of Selling on ThredUp
- Cons of Selling on ThredUp
- Tips for Maximizing Profit on ThredUp
- Addressing Common Concerns
- Mercari: An Alternative for Higher Potential Profit
- FAQ
Understanding ThredUp’s Payout Structure
ThredUp operates on a consignment model, meaning they handle the entire selling process for you. You send in your items, and they take care of listing, photography, pricing, and shipping. Sounds effortless, right? However, this convenience comes at a price: varying commission rates and potential fees.
ThredUp’s commission structure is tiered, with percentages increasing based on the final selling price of your item. For items sold under $15, you’ll receive a smaller percentage, while pricier items earn you a higher payout. On top of this, you might encounter processing fees depending on your chosen payout method.
This structure contrasts with platforms like Mercari and Poshmark, where you have more control over pricing and potentially earn higher profits. The trade-off is you’re responsible for all aspects of the selling process, from creating listings and taking photos to handling shipping and customer inquiries.
Pros of Selling on ThredUp
Convenience: ThredUp’s hands-off approach is its biggest advantage. You can declutter your closet and potentially earn money without lifting a finger beyond packing your items.
Wide Audience: ThredUp boasts a vast customer base actively seeking secondhand clothing. Your items gain instant exposure to a large pool of potential buyers.
Brand Recognition: ThredUp has built a reputation for quality and authenticity, which can benefit your sales. Buyers trust the platform, and that trust extends to the items listed.
Potential for Passive Income: Once your items are accepted, you can sit back and wait for the sales to roll in. It’s a minimal-effort way to earn some extra cash.
Cons of Selling on ThredUp
Lower Profit Margins: Due to the commission rates and fees, your profit margins will be significantly lower compared to selling directly on other platforms.
Limited Control: You surrender control over pricing, listing details, and buyer interaction. You can’t adjust prices to match market demand or negotiate with potential buyers.
Acceptance Process: ThredUp has strict acceptance criteria for the items they list. Your carefully curated bag might result in several rejected pieces, which can be frustrating.
Turnaround Time: From processing your bag to receiving payment, the process can take time. You might experience delays, especially during peak seasons.
Tips for Maximizing Profit on ThredUp
Research Popular Brands: Focus on sending in items from brands known to perform well on ThredUp, such as Lululemon, Patagonia, Vuori, Reformation, Free People, Zara, Johnny Was, Sézane, Anthropologie, and Skims.
High-Demand Items: Prioritize pieces with high demand and search volume on the platform. Check ThredUp’s website to see what’s currently trending.
Seasonal Items: Time your shipments to align with the current season. Sending in summer dresses in July will likely result in faster sales compared to sending them in January.
Quality over Quantity: It’s better to send in fewer high-quality, in-demand items than a large bag of low-value pieces.
Optimize Item Descriptions: Provide accurate details about your items, including materials, size, and condition, to improve your chances of acceptance.
Addressing Common Concerns
What happens to unaccepted items? ThredUp offers options for returning unaccepted items to you (for a fee) or donating them to charity.
How long does it take to receive payment? ThredUp typically pays out within 14 days after your items sell. You can choose to receive payment via PayPal, direct deposit, or a ThredUp shopping credit (which earns you a bonus).
Is it possible to get scammed on ThredUp? ThredUp has safety measures and seller protections in place. They authenticate luxury items and handle all buyer disputes, minimizing the risk of scams.
Mercari: An Alternative for Higher Potential Profit
If you crave more control and the potential for higher profit margins, Mercari is a viable alternative. This platform puts you in the driver’s seat, allowing you to set your prices, manage listings, and interact with buyers directly.
Here are some key Mercari strategies gleaned from the audio:
- Price high, anticipating offers. List your items higher than you think they’ll sell for, expecting buyers to make offers.
- Offer free shipping. Listings with free shipping tend to convert better, even if you factor the shipping cost into the listing price.
- Prioritize good customer service and ratings. Happy customers leave positive reviews, which build trust and attract new buyers. Respond promptly to inquiries and address any issues professionally.
- Test multiple products and double down on successes. Experiment with various items and categories to find what sells best for you. Once you discover a winning product or category, focus on listing more items in that area.
FAQ
What are the typical cost of goods for items sold in the audio? The speaker mentions sourcing items primarily from the Goodwill Outlet bins, where they pay between $1-$3 per item, with heavier items potentially costing more.
How does Mercari’s automatic price drop feature work? This feature gradually lowers the price of your listing over time to create a sense of urgency and attract buyers. You can set a minimum price to avoid selling below your desired profit margin.
Does ThredUp offer faster payout options? ThredUp’s standard payout time is 14 days, but they don’t currently offer faster payout options.
What are the top reasons consumers shop and sell secondhand? The ThredUp Resale Report highlights savings as the primary motivator for secondhand shoppers, while earning cash is the top reason for sellers. Sustainability and environmental concerns, while important, rank lower for both buyers and sellers.