The circular retail economy and how it’s on the rise

The circular retail economy and how it’s on the rise

Retail – Workplace April 2019

Smarter solutions

The popularity of the “Kondo effect” championed by Japanese home organisation guru and media sensation Marie Kondo, is seeing New Zealanders offloading possessions that don’t spark joy to op shops or selling via online platforms in order to streamline their belongings.

Buying second-hand is becoming more mainstream and internationally, there are entire shopping centres dedicated to selling second-hand goods popping up – perhaps something for New Zealand to think about?

Globally, the second-hand or re-sale market has become a rising retail star with viable business models emerging from this trend to declutter, coupled with concerns around mass consumerism, sustainability and the ethics involved in the fast fashion industry.

The “what-goes-around-comes-around” concept is seeing eager vintage or retro fashion and homewares lovers seeking out treasures from an early era and doing their bit for the planet in salvaging items that may otherwise go to landfill.

Market data from US-based retail analytics firm GlobalData shows a boom in what they call the “circular economy” particularly where fashion is concerned.

According to GlobalData’s most recent survey in conjunction with American-based online luxury fashion re-seller thredUP, 56 million US women bought second-hand clothes in 2018, an increase of 12 million compared to the previous year.

This increase has in part been attributed to millennials and Generation Z – defined by Forbes as those people born from the mid-1990s to the early 2000s – who are reportedly 2.5 times more likely to buy a vintage item.

These conscious-consumers are also more likely to be social media influencers and they’re spreading the word that we should be mindful of a product's life cycle and the carbon footprint fast-fashion and on-trend furniture and furnishings leave behind.

Just as the fast-fashion industry generates demand and desirability for people to own and wear the latest high street trend, so too does the re-sale market fuel the “must-have” desire.

Vintage re-sellers are seeing demand spike for clothes from the 1970s, vintage handbags from luxury brands where current models are out-of-reach for many, clothes and accessories that your Nana may have worn and retro children’s clothes – often driven by a move towards an individual look rather than a mass-produced carbon copy out of a fashion store’s look-book.

Not only have charity stores benefitted from a heightened drive for individuality, sustainability and conscious-consumerism, dedicated re-sale stores are on the rise.

In Sweden, an entire mall dedicated to second-hand items has been making noise in a crowded market place.

ReTuna, is a two-storey retail complex 110km west of Stockholm employing more than 50 staff and offering a wide selection of shops including a vintage furniture outlet, a bookstore and a bicycle shop – all selling upcycled, reused and recycled goods.

Sales at the mall have quadrupled since it opened its doors in 2015 and it’s based on the premise of making it easier for people to find valuable, pre-loved goods by putting second-hand stores under one roof instead of consumers having to search for opportunities far, wide and online.

The Huffington Post reports that nearly every item on sale at ReTuna is from public donations, which are dropped off at the mall’s drive-through depot.

In New Zealand our established suburban retail areas have long-offered charity shops, antique/retro furniture stores and consignment clothing shops however, it seems recycle, upcycle, reuse and re-wear are terms we’ll see more of as the retail scene evolves to embrace different business models and a greater awareness of sustainability.

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