The circular economy promises to reinvent retail. Why is trust so difficult?

Austerity is backthough this time it has a tech spin to it.

A new generation has discovered the joys of digging through other people’s discarded clothes in hopes of finding the perfect piece. Hoping to cash in on the trend, companies are adopting sales platforms, allowing them to capture some residual value while polishing their sustainability bona fides.

If it sounds too good to be true, it is for now, at least. Brand-owned retail still has a few kinks to work out if it’s to transform into retail.

Few companies embrace reselling like Patagonia, the outdoor gear supplier. the Worn Worn The program, which started as a used clothing section of its retail stores, is now a full e-commerce site that offers discounts on items that have a lot of life in them. For brand enthusiasts, it also gives them access to back catalog items that are no longer available. It’s a decade-long experiment that teases out what a future circular economy might look like.

For companies like Patagonia, brand-owned marketing is attractive for several reasons. The private company’s clothing has a reputation of being a “lifetime buy,” and its items tend to last for years, even decades. In addition, for a company that has staked its name on sustainability, selling used clothing is a logical extension of the brand.

For other companies, even if sustainability is not a key differentiator, brand-owned sites help capture some of the value that would otherwise go to secondhand markets such as eBay, Poshmark, Mercari and others.

To fill Worn Wear’s virtual shelves, Patagonia pays people for their old clothing. Not as much as they would get if they sold it directly on other resale sites, but it promises a simpler process: drop the clothes off at a Patagonia store or have them shipped. The company partner, Trovemanages others.

When an item arrives at Trove’s warehouse in California, a team of workers inspects and retrieves it. It also compares the item ID against a database it maintains to determine if the piece is authentic. Items that cannot be identified (perhaps the item ID cannot be read), the company uses computer vision to find possibilities. Workers record descriptions of each item’s condition so that once they appear on the resale site, which is also managed by Trove, customers have a decent idea of ​​what they’re buying. Because every item that passes through Trove’s warehouse has different wear patterns, they all receive unique SKUs. Partners can monitor the performance of their resale platform through dashboards, reports and CRM integrations.

Trove rode the resale wave, raising more than $150 million in total, including an early-stage investment from Tin Shed Ventures, Patagonia’s venture capital fund. It is not the only sales platform that works directly with brands, but it is widely considered a leader. But, lately, Trove seems to have stumbled. Its Series E round, which closed in July, added another $30 million to its coffers but also cut its valuation in half, according to PitchBook. However, the company has also managed to attract a dozen clothing and outdoor equipment companies to its platform, including not only Patagonia but also REI, Levi’s, Lululemon, Allbirds and others. .

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