Saturday, November 26, 2022

With Its First Manhattan Location, Luxury Secondhand Reseller Fashionphile Continues Its Ascent

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Luxury resale company Fashionphile, known for its large collection of secondhand bags, is opening its first location in New York City.

California-based Fashionphile is extending its reach as the premier resale platform for luxury bags and accessories with its first Manhattan location. A Neiman Marcus partner—the retailer took a minority stake in the company in 2019—it now has showrooms in ten select Neiman Marcus stores.

The New York location will be in Chelsea, taking over a 60,000-square-foot space that the company says will offer handbags as well as luxury watches, among other accessories. Fashionphile says it has the largest collection of used Hermès Birkin bags in the world. The new showroom will also help the company increase its inventory and improve customer experience.

In-person resale studio

Unlike the growing trend of secondhand resale platforms where the majority of sales are done online, Fashionphile has prioritized its in-person studio selling. Consumers bring their gently used luxury accessories—mainly handbags—to the Fashionphile studios and sell the items on the spot where they receive a Neiman Marcus gift card.

That model has been successful for both brands; Neiman Marcus says it sees 100 percent redemption on the gift cards, with sales often going back into Fashionphile and total sales exceeding the gift card value by more than 2.5 times.

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“This service is not only sustainable, it’s a key driver of customer experience and loyalty with our top spend clients — driving increased footfall and spend. We intend for recommerce and circularity services to play a role in our long term business and growth strategy,” president and CCO David Goubert, told Vogue Business.

In 2021, Fashionphile, which doesn’t disclose its sales, recorded between $450 million and $500 million in gross merchandise value—and it has been profitable since it launched as an eBay store in 1999. The average selling price of Fashionphile bags is $1,600. “We just don’t sell anything that’s not an ultra-luxury accessory,” Fashionphile founder Sarah Davis said.

Secondhand awareness

“Part of this puzzle is awareness. How do you get awareness to people who buy what we sell and sell what we buy — the truly ultra-luxury customer, buyer, aficionado? Chelsea is just one small part of that story. You’re going to see us so much more, building out awareness in different ways than you’re used to,” says Davis.

And while Fashionphile does prioritize the in-person selling, it has a partnership with Christie’s New York online for the sale of rare and classic bags from Maisons including Hermès, Chanel, and Louis Vuitton among others, as part of Christie’s New York Luxury Week.

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It also works with Farfetch, offering a white-label platform that has been a value-add to the platform’s sustainability metrics as consumers increasingly seek out secondhand products.

The secondhand market, particularly luxury, is on an upward swing with platforms like luxury watch resaler WatchBox now valued at more than $1 billion. Leading the peer-to-peer selling is France-based B Corp The Vestiaire Collective, which just expanded its U.S. reach with the acquisition of Tradesy.

Resale platform ThredUp’s recent annual report identified secondhand fashion as outpacing sales of fast fashion, expecting to reach $82 billion by 2026 in the U.S.

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