There's a thrill that comes from making a sale of a long-ignored top from a brand you no longer have an appetite for, which is why so many people have gone from selling a few of their early aughts tanks for extra cash to selling thousands for a downpayment on a house.
This has been made possible by the growth of the secondhand economy — a $24 billion market as of 2018 — which is expected to outpace fast fashion within the next 10 years and hit a $64 billion valuation, according to ThredUp's 2019 resale report.
"I can't tell you the number of times I get pinged a day from our community of people telling me, 'I love Poshmark, because I was able to pay for my car or pay my child's college tuition,'" says LyAnn Chhay, the Senior Vice President of Community at Poshmark. "So many Poshers across the country have quit their nine-to-five jobs to pursue selling on Poshmark full-time and have made careers earning six and seven figures."
Even students, or those who haven’t entered the job market yet, are making big bucks off the closet-sharing platform, such as Shannon Welch, who graduated two weeks ago from Texas A&M University with a degree in Economics. Unlike many of her peers, Welch is not in the market for a job. Instead, she is devoting all of her time to her Poshmark store, which has already brought in $40,000 in sales this year.
"It's certainly becoming much more common for kids in high school or college," says Russ Amidon, the Senior Director of VIP Relations at StockX. "It's very typical today for that age group to get a paid internship or job, but it's getting harder and harder to find something like that if you don't have the experience, so we're seeing a lot of that younger demographic start to do this as entrepreneurs."
Nearly half of StockX users are under the age of 25, and more than 80% are under the age of 35. "I can get on a call with a 15-year-old who is selling 1,000 pairs of sneakers a week, and the next client that I talk to is a financial adviser in New York City who works for an investment firm," Amidon says. And while top sellers vary on volume and product, there are many users who sell more than a million annually or multiple millions per year in gross merchandise volume.
"There is definitely a certain level where the people who are very successful selling have a tremendous amount of drive, and when you're dealing with high volume and selling upwards of 1,000 pairs of shoes a week, it can become an 80-hour-a-week job," Amidon explains. "You're constantly selling, monitoring prices and new releases every week. One quality that we do see across all of our top sellers is they are very sophisticated; they're organized and some even have teams that pack and ship for them."
We spoke to power sellers and top earners from various resale marketplaces to find out how they turned their side hustles into full-blown businesses. Read on for their tips.
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One person's junk is another's treasure
Product sourcing can be as simple as digging through your attic for a pair of pre-loved Levi's or running to your nearest Goodwill. "I do what we call label hunting, rather than actually looking at the clothes," explains Welch, who drops into thrift stores and frequents flea markets multiple times a week to maintain an inventory of over 1,000 garments. "I'm just looking at the labels."
Some secondhand sellers, however, have a more complex system of obtaining goods that involves working with distributors and big retailers. Shannon Jean, a California-based full-time Poshmark seller who focuses on luxury handbags, established a relationship with various companies by asking to buy their defective products and store returns. Essentially, he wanted their junk. "There's good margin in defective bags," Jean says. "A defective bag can sometimes have a bigger impact on someone's life than a brand new bag, because they can afford it."
He's since moved on from damaged leather and onto more sought-after accessories. "In the beginning, I wasn't buying Prada and Chanel; I was buying Michael Kors and Kate Spade, because that's all I could get," notes Jean. "Once I started to learn the system and made good connections, then I just expanded and moved my way up to where I rarely buy defective bags now."
And while Welch has done well — $90,000 in sales last year well — digging through the racks at Plato's Closet, Jean says if you really want to turn your resale gig into a business that generates six figures, then you have to have access to some capital and be willing to risk it. "If someone tells me, 'Look, I've got $30,000 worth of this Prada or Balenciaga, can you buy it?' my answer is always yes," Jean says. "I'll do about a half a million in bag sales this year, but you have to invest money to hit those numbers."
Figure out the most efficient way to manage your inventory
Once you build up a substantial inventory of Marie Kondo'd clothes, you have to figure out how best to store them and easily locate them when an item is sold. Welch organizes her items by category and size, except Free People — her bestselling brand — gets special treatment. "I have all Free People separate, by category as well," Welch says, before adding that the rapid growth of her business is prompting her to switch over to a serial number system, where each garment will be assigned a different series of letters and numbers and then packaged and labeled with that serial number.
Working with just shoes or handbags does make things a bit easier in terms of storage. "You could put $100,000 worth of bags on a few racks. It doesn't take much space," explains Jean, who stores his bags in a specially built annex near his house that's equipped with a security system.
Use high quality product shots
When asked what's key to becoming a power seller on Grailed, Sam Barback, who manages the site's curation team and Davil Tran, who works at the company as a fraud specialist, agree that high quality photos differentiate good and great sellers.
The same goes for Poshmark. "Natural lighting is the golden ticket," Welch says. "If you have it, use it." Welch takes all of her flat lays on her balcony and uses a white poster board purchased from Hobby Lobby, and a fig leaf, to "give it a little bit of an accent." For items that cannot be flat laid, she uses a white brick photo backdrop that she hangs up on the wall and a ring light to help with brightness. "I model all of my own clothes, if possible, because it helps people understand how it's going to fit them and look on them."
Exercise Nordstrom-level customer service
Secondhand has moved from the fringes to the mainstream, meaning customers who turn to the resale market want a blissful shopping experience that delivers the same level of satisfaction and professionalism as Net-a-Porter or Nordstrom. That means fast shipping and solid packaging. Jean sends all of his bags in their original dust bags or uses his own dust bags if the bag did not come with one. Similarly, Welch wraps everything in tissue paper and sends a handwritten thank you note in each package.
"I try to ship items as quickly as possible — usually same day or the next day," Welch says. If she is unable to do so, she'll reach out to the buyer to let them know that shipping will be delayed and to apologize for any inconvenience. "I've never had a bad experience with that, because as long as you're upfront about it, they appreciate it and understand."
Once the packages have been received, Welch reaches out to the buyers to make sure they are pleased with their order and asks them to leave a review. "Once they do leave a review, I will extend to them an offer of 50% off if they buy three or more items at once," Welch says. "It's an incentive for them to come back and shop with me again — there's nothing better than a returning customer."
It's all about engagement
Being active in the closet-sharing community is the best way to grow your following and sell more items. "It's all about engagement with other sellers, engagement with buyers, targeting people that are interested in your brands by following them and getting them to follow you back," Jean says. "That's part of the secret sauce to Poshmark."
It's also important to like other people's items, comment on them and share them. "Top seller stylists make the most of Poshmark's community," Chhay says. "They also attend the in-app Posh Parties and the local Posh Party Live events, mostly to establish strong relationships with one another on the platform."
Another way sellers can connect with more people is through social media. Welch has a special Instagram account to promote her listings on Poshmark and to post tips to help others. "We do these things called thrift hauls," Welch explains. "So, if we have a really successful thrifting day, we'll come home and we''ll record ourselves talking about everything that we picked up that day, what brands are selling well for us and what we expect to sell these items for. On top of that, it does create a lot of traffic towards my closet."
You don't have to sell only what you know
"You don't have to be a sneakerhead or someone who loves sneakers in order to do this," says Vernon Simms, a 32-year-old StockX seller from Atlanta who specializes in sneakers. "If you're just looking for a way to make some extra income on the side, you can do it without even knowing a lot about shoes."
Jean knew nothing about designer handbags when he got his start on Poshmark three years ago. His background is in landscape architecture and technology, but Jean got interested in the handbag space, because he wanted to sell something that didn't drop in value like a desktop computer. Now, he says he knows way more about pricey purses than his wife. "I study it, because it's my business."
Simms landed on reselling sneakers after being a bit of a "nomad" with jobs. He did work at Finish Line, so he had some understanding of the value of sneakers, but it wasn't until he saw how much people were willing to pay on eBay for a rare pair of kicks that he decided to go into business with shoes. Simms originally was active on eBay before discovering StockX in 2016. In 2018, he made around $600,000 in sales on the site, and he's already made $300,000 this year.
"I've been in the music industry for a long time and was a professional touring DJ and music producer for years," Simms says. "I realized that this was full-time when I started turning down DJ gigs because I wasn't going to make as much money that weekend as selling sneakers."