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Millennial Money: Kick-start your own online used clothing gig

Looking for some extra cash? The answer may be in your closet
Tradesy CEO on how to cash in on your closet 04:31

With the recent rise of resale apps like Depop and Poshmark, selling used clothing online is becoming more fashionable. Many people have turned clothing resale into a lucrative side gig, gaining thousands of followers and making dozens of sales per week.

The secondhand-clothing market is projected to more than triple by 2030, according to a 2021 study by resale platform Mercari and research firm GlobalData, as more fashion enthusiasts clean out their closets and comb through thrift stores to find valuable pieces to resell.

Here are some things to consider before diving into your closet. 

Set your own prices

Unlike online consignment stores, resale apps let you decide how much to list your items for. Before listing an article of clothing, search for similar items across multiple platforms to determine what it is worth, and note that the brand and condition of the garment will affect its price.  

On apps like Depop and Poshmark, you can message prospective buyers directly and negotiate sales prices. They also have tools that allow you to discount items in your inventory. 

"Sales can be sporadic," said Andres Castillo of Los Angeles, who sells rare designer pieces through Depop, eBay and Instagram under the name Debonair Vintage. With rare or high-value items, it can take time to find a buyer who appreciates its value and is willing to shell out what you're asking for, so that you can profit.

Like a job

"I treat (reselling clothes) like my job," said Eve Perez, a full-time student in Lebanon, Pennsylvania, who sells under the name Fitsfinesse and was featured in Teen Vogue in 2021 for her success on Depop. She responds to messages from buyers daily, photographs products to list them, sews custom pieces, and packages and ships orders.

Communicating clearly with first-time buyers is essential: "If you don't build that relationship, then you won't get sales and returning customers," she said.

Although you set prices, reselling online is more time-consuming than consigning your wardrobe. According to Depop, sellers who list at least 15 items per week generate more sales over time, by building a following. 

"It takes a lot of time and dedication," said Castillo. Top-notch sellers have to learn to take eye-catching photos, understand shipping rates, negotiate over text messages, and research brands and trends to make the most of their inventory.

Overhead costs add up

When setting your prices, it's important to factor in overhead costs. Online resale platforms charge commission fees, plus additional fees for shipping through the platform or accepting payments through a processor like PayPal. Depop pockets10% of every sale and eBay takes 15%; Poshmark charges $2.95 for items under $15 and takes a 20% commission on items that sell for more than $15. PayPal, which integrates with Depop, Poshmark and eBay, charges another 3.49% plus 49 cents per transaction for payment processing.

Additionally, you are responsible for buying packaging materials, printing labels and making space to store your inventory, which can require buying bins and hangers. Top-performing sellers also recommend adding a personal touch to shipments, like free stickers, small accessories or a thank you note. Considering these costs, lower-value items might not make sense to sell, especially if you won't even break even on them. 

You can cut costs by reusing shipping mailers and boxes, and printing labels at your local FedEx or UPS store instead of purchasing a label printer. Or, reduce shipping costs for buyers by bundling several items into a single shipment, which can motivate buyers to purchase more from your shop.

Building your brand

The most successful online resellers consistently have strong personal brands. Finding your niche and building a loyal following is essential to long-term success on a resale platform.

"It's like Instagram, but for selling," said Perez, who focuses on curating a consistent aesthetic and marketing her shop on social media platforms like TikTok.

Castillo grew his business by catering to a very specific market: collectors of vintage Moschino and Chanel. He sells across several platforms and also uses his Instagram account to rent pieces out to stylists for photo shoots and red-carpet events.  

"Lean into your personal taste," said Castillo. Even if you don't have a curated collection to sell, personalized packaging or a unique photo background can help your items stand out.

Both Perez and Castillo emphasize the importance of cross-linking social media platforms to reach as many potential customers as possible. Creating a dedicated Instagram account for your business and following other online sellers and designers can help drive buyers to your shop. Check popular pages for trendy hashtags and add those to your posts to increase their visibility. Making the time to promote your brand on social media can help turn unworn pieces in your closet into meaningful income. 

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