For decades, Americans have had an insatiable appetite for new clothing, spurred on by the fast-fashion industry, which cranked out cheap, disposable garments that helped global clothing production double from 50 billion items a year in 2000 to more than 100 billion today. (There are only 7.8 billion humans on the planet.) The environmental toll of this is steep: Apparel producers consume 108 million tons of nonrenewable resources every year and emit 1.2 billion tons of greenhouse gases, more than all international flights and maritime shipping trips combined. Meanwhile, a truckload of clothes is either sent to the landfill or incinerated every second.
But the tide is turning: Between 2017 and 2019, the number of items in American women’s closets dropped for the first time, from 164 to 136—a trend that’s been aided by several startups transforming the way clothing is bought and sold. Some of these companies, such as CaaStle, are creating clothing rental services that satisfy people’s desire to be in style without having to shop. Others, like ThredUp and Trove, are building resale marketplaces that extend the life of everyday clothes. All of them are challenging the preconception—among shoppers and clothing brands alike—that newer is better.
“Clothing rentals have gone from something a couple of startups were doing to something being adopted by old-school retailers,” says CaaStle founder and CEO Christine Hunsicker. She would know: In 2012, she launched Gwynnie Bee, a subscription service that now offers clothing rentals from more than 150 labels in sizes 0 to 32. But Hunsicker saw even more opportunity in helping retailers and clothing brands create their own rental services. Her two-year-old CaaStle logistics platform integrates with companies’ inventory systems and manages the entire rental process on their behalf, from warehousing and cleaning garments to gathering feedback from customers about how an item fits.
Hunsicker’s pitch is simple: “We help brands strengthen their relationship with the customer,” she says. While most people typically buy only a handful of things from a label each year, CaaStle has found that, through rental, they’ll wear up to 100 items from a brand—and are more inclined to remain loyal when they do make purchases. As CaaStle signs on customers, it’s bringing the rental ethos to new demographics. In the past year, it partnered with American Eagle to power the first rental service aimed at Gen Z, Scotch & Soda to launch the first men’s rental service, Bloomingdale’s for the first rental service from a department store, and Banana Republic. (CaaStle also launched Haverdash, its own multibrand rental service for women and the most affordable one on the market, at $59 a month.) “It’s not about moving the customer away from retail and into rental. It’s about integrating the offerings,” says Hunsicker, who is beginning to experiment with physical spaces: CaaStle-powered pop-ups will open next year in select Express stores.
WATCH: How data helped CaaStle break through in the difficult retail industry
Used-clothing platform ThredUp, which sells everything from Old Navy tees to Gucci heels, received roughly 100,000 items a day from would-be sellers in 2019 and processed its 100 millionth garment for the site. But the 10-year-old platform broke new ground last year as well, partnering with other retailers to find potential secondhand shoppers, wherever they may be. “People in their twenties and thirties were born into [the sharing economy],” says James Reinhart, ThredUp’s founder and CEO. “For people in their forties and older, this consumption model requires training.”
To reach them, the company set up special secondhand sections in nearly three dozen JCPenneys and worked with Macy’s to create secondhand sections in 40 of its department stores. Cult denim brand Madewell now has ThredUp-sourced “archive collections” at several of its stores. ThredUp also partnered with companies such as Reformation and Amour Vert to enable fans of those brands to send ThredUp old clothes (from any label) in exchange for shopping credit at their stores. ThredUp even created its own digital storefront on eBay to woo that site’s secondhand shoppers.
Meanwhile, the company is using the $175 million it raised last year to expand its network of warehouses, which are equipped with proprietary technology that can price, photograph, and efficiently distribute one-of-a-kind items. (Sellers make money from every item sold, and ThredUp takes a commission.) In 2019, the company added its fourth center, in Phoenix, staffed by 500 workers, and it recently broke ground on its fifth, which will be the largest, in Atlanta. “There are so many clothes out there that in order to make a [sustainable] dent in the universe, which is our vision, we need to build the infrastructure,” Reinhart says.
If you’re in the market for a used Patagonia fleece, Patagonia wants to be the one to sell it to you. Powered by the logistics startup Trove, Patagonia’s Worn Wear website buys back items from customers, refurbishes and cleans them, and sells them at a fraction of their original price. It might seem counterproductive for a brand to want to sell lower-priced, secondhand merchandise to customers who might otherwise buy at full price, but Trove CEO Andy Ruben (who previously served as Walmart’s chief sustainability officer) says that launching a resale marketplace allows clothing labels “to create a new revenue stream, get new customers, [and] capture their fair share of the secondary market.” Within six months of Worn Wear’s 2017 launch, Patagonia had generated $1 million in sales from the site, which has been profitable ever since.
Trove has gone on to build out its operations, so it can purchase, process, price, and photograph secondhand goods before putting them up for sale on each brand’s dedicated resale website (Trove even takes care of returns and customer service). It has also attracted new customers, including REI and Eileen Fisher, which has brought in more than $4 million in revenue from its profitable ReNew resale site. Last year, Trove added Arc’teryx and Taylor Stitch to its portfolio, and it recently launched a secondhand marketplace for Nordstrom. By having their own resale sites, Ruben says, “these [companies] demonstrate their commitment to getting more out of the clothes they’ve already made.”
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- Footprint is proving that sustainability can scale
A version of this article appeared in the March/April 2020 issue of Fast Company magazine.