Re-commerce, a term encompassing rental and resale, has gained significant popularity as consumers increasingly prioritize sustainable options in their shopping habits. This shift has proved highly profitable for businesses, not only driving revenue but also attracting new customers. A Barclaycard report reveals that seven out of ten businesses now offer sustainable shopping choices, leading to the rise of a “Re-commerce Economy” centered on recycling, renting, reusing, and reselling.
One-third of retailers attribute the growth of re-commerce to the growing environmental consciousness among consumers and the higher cost of living. In response, 40% of retailers have implemented rental models, with an additional 23% considering doing so to meet the surging demand. Interestingly, over half of the retailers have noticed a decline in returns, reversing the previous trend of excessive returns during lockdowns.
Barclaycard’s survey of businesses in the UK found that 36% had introduced more sustainable shopping options in the past year. Among these retailers, a remarkable 89% plan to expand their offerings to meet the rising demand for affordable and eco-friendly alternatives. While some retailers prioritize affordability, 44% are motivated by their commitment to reducing their environmental impact.
Of the UK retailers surveyed, 40% currently offer rental models, with 61% of them launching these models in the past year. Another 23% are considering implementing rental options soon. This move has been highly beneficial, with 90% of retailers witnessing increased revenue and 89% experiencing growth in their rental customer base, averaging a 31% rise.
Moreover, 39% of retailers now provide their own reselling options, allowing customers to buy and sell second-hand items. Among these retailers, 23% introduced reselling platforms in the past year, while 26% are contemplating establishing them in the near future. The most common rental items are jewelry, designer clothing, suits, designer bags, and wedding dresses. Ski clothing has also emerged as a significant category in the rental market, as highlighted by luxury department store Selfridges.
Barclaycard’s research also uncovered the most common pre-owned products available for purchase from retailers, with clothing ranking first at 29%, followed by designer bags at 28%, jewelry at 27%, and designer clothing at 25%. Other popular categories include suits in sixth place and wedding dresses in eighth place.
In terms of returns, although some retailers observed higher return rates after the pandemic, the overall trend has shown a decrease, as 56% of retailers reported lower return rates in the past year. Additionally, the number of items returned decreased by 14% compared to the previous year. This shift can be attributed to consumers making more thoughtful purchasing decisions, buying fewer items due to increased living costs, favoring eco-friendly choices, and utilizing reselling platforms instead of returning unwanted goods to stores.
Useful links:
– Tips for Selling Used Clothing Online
– Keys to Building Resilience through Reverse Logistics and Re-commerce
