Secondhand fashion marketplaces like to wax lyrical about the environmental benefits of buying pre-owned clothes. Compared with the quickly made and quickly binned clothes their fast fashion competitors churn out, the conclusion seems to be a simple one.
According to EU figures, clothing and shoe production is responsible for 10% of global carbon emissions — more than international flights and shipping combined. A massive 70% of the fashion industry’s greenhouse gas emissions come from the production process.
Cut that out and we should be laughing, right? Wrong, according to Lee Smith, head of commerce at retail consultancy Kantar.
“The sustainability of secondhand fashion has many components,” she tells Sifted, with the environmental impact of shipping secondhand items still considerable. Questions also remain over whether consumers are replacing new fashion purchases with secondhand — or just adding to them, Smith adds.
On top of that, it’s also important to look at the environmental costs of running big warehouses to clean and store preowned items before sending them on, return rates and the sustainability of packaging.
Whichever way you cut it, reducing the impact of fashion isn’t as simple as keeping clothes in circulation for longer.
So how do the green credentials of Europe’s secondhand fashion marketplaces stack up? Sifted spoke to a number of industry leaders about how they’re measuring their environmental impact and what they’re doing to reduce it.
Lockers and electric vehicles
There are two models of secondhand marketplaces. One is peer-to-peer (P2P), where companies simply provide a platform for sellers to hawk their wares to buyers — like Depop or Vinted — in exchange for a cut on sales taken from both sellers and buyers.
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The other is “managed” marketplaces, where startups source preowned clothes in bulk from consumers or brands and then sell them on at a markup.
For both, shipping is one of the biggest emitters. While P2P marketplaces don’t touch the clothes sold on their platform — and so don’t directly generate emissions from shipping — the people selling on them do. According to Depop’s head of sustainability Justine Porterie, 98% of the company’s carbon footprint in 2020 came from users shipping parcels.
It’s a different proposition for managed marketplaces, says Gustav Wessman, chief commercial officer at preowned platform Sellpy, as they can ship more efficiently, and he claims, ultimately more sustainably than their P2P counterparts.
“Buying and selling directly between customers can lead to increased emissions from packaging and transportation,” he tells Sifted, “as there might be more transactions and fewer products per package.”
Nonetheless, there’s at least one extra layer of shipping to account for with managed marketplaces, as they ship the clothes from source to warehouse before sending them back out to a buyer.
“The transportation piece is something that needs to be solved,” says Carolina Brochado, partner at EQT Growth and Vinted board member. A number of secondhand marketplaces are looking for “ESG-friendly ways” to ship fashion, she adds, like using pick up and drop off (PUDO) lockers or electric vehicles (EVs).
PUDO lockers remove last-mile delivery from the equation — which can account for more than half of all environmental shipping costs — and are often located in populated areas, so consumers can collect or drop off a parcel while on a journey they would have taken anyway.
Vinted sustainability manager Sigita Žvirblytė says the company is “encouraging” sellers to use these lockers, rather than home delivery, and provides access to 200k across its partner network in 13 European markets.
Finding an electric fleet to deliver the merchandise, on the other hand, is easier said than done. For managed marketplace Thrift, which buys clothes in bulk from consumers, it’s been one of the major challenges in reducing the environmental impact of shipping.
In the UK, there are no logistics or courier providers that are “fully green”, says head of growth Miranda Essex. “[Courier company] DPD has got the [most electric] fleet,” she says, but there are cost and infrastructure barriers around recharging these vehicles and planning efficient delivery routes around charging points. Lobby groups are pushing for the UK to address its lack of EV charging points.
Essex says Thrift has thought about taking a leaf out of veg box provider Oddbox’s book when it comes to deliveries — Oddbox only delivers at night, on hyper-efficient routes and once a week to minimise its climate impact.
But the benefits of less regular, optimised deliveries have to be weighed against the goal of trying to draw fast fashion consumers — who expect very quick shipping — towards preowned fashion.
“There’s the question of are you going to be able to convert them to shopping secondhand if you don't provide a vaguely comparable experience,” she tells Sifted.
Then there’s the problem of just how far some clothes travel to get to their new owners. Some secondhand marketplaces say that they’re doing more to encourage local shipping, to cut the sometimes vast distances fashion travels to reach a buyer.
Sellers on Depop’s platform can ship to the UK, Canada, Australia and the US — although Porterie tells Sifted that the company is looking into adding product features to help customers find clothes that are geographically closer.
While Vinted allows sellers in Europe to ship to neighbouring countries — France is connected with Belgium, the Netherlands, Portugal, Spain and Italy, for example — it doesn't ship between Europe and North America.
"We see that in our more mature markets, like France, the large majority of shipping is domestic," says Vinted's Žvirblytė. "As newer markets grow the domestic share also tends to grow, as domestic shipping is generally cheaper and quicker."
Northern Ireland-based Responsible, a managed marketplace that buys secondhand fashion from brands — as well as consumers — before refurbishing and selling them on, also said it was exploring local delivery models.
Shipping is the biggest contributor to Responsible’s carbon footprint, says chief marketing officer Ciarán Jordan, but decentralisation could be one solution.
Responsible plans to open two new warehouses in mainland Europe and North America — alongside its existing one in Belfast — in the next couple of months, to reduce the distance its secondhand apparel travels.
The length of the journey secondhand fashion takes to get to a buyer, he says, is an area where some of the bigger marketplaces — like North American company Thredup — have fallen down.
“The major players do have a big footprint from their centralised operations,” he tells Sifted. “We can learn from that, take a different trajectory and develop a more localised presence.”
Warehouses and offices
For managed marketplaces like Thrift and Responsible, reducing the environmental costs of powering warehouses and washing and repackaging clothes are other key sustainability battlegrounds.
Responsible’s Jordan tells Sifted that the company recently opted out of an energy deal with the business park its warehouse in Belfast sits in so it could turn to green sources.
“There’s always hundreds of unglamorous things you can do that make a difference [with warehouse sustainability],” he adds. Jordan says Responsible has found more sustainable waste collectors and changed the type of lightbulb it uses in its warehouses in its bid to go greener. Responsible doesn’t have any data on the impact these changes made because it didn’t measure the environmental impact of the initial setup, Jordan tells Sifted.
Thrift, too, has a single warehouse in the UK, and Essex tells Sifted it measures things like energy consumption, water, waste handling and use of chemicals, as it looks to reduce its footprint. The warehouse is partly solar panelled and the plan is to retrospectively offset emissions as Thrift scales.
For much larger P2P marketplaces like Depop and Vinted — which don’t have warehouses but do have over 1,000 employees who each need somewhere to work — running offices can be a significant drain on the environment.
Žvirblytė of Vinted tells Sifted that the company uses green energy for all servers hosting its app, as well as for its bigger offices in Vilnius and Berlin. Likewise, in its public sustainability plan, Depop said all of its offices will be run on renewable energy by the end of 2022.
Returns and packaging
One of the big environmental costs of fast fashion is returns. According to some estimates, 30-40% of purchases get sent back, which means more shipping, before being sent out to a new buyer — or worse still, sent to the landfill.
That’s not so much of a problem for P2P marketplaces like Vinted or Depop, both tell Sifted, because neither offer a general returns policy — so sellers aren’t obliged to accept take-backs if a piece of clothing doesn’t fit the buyer on arrival.
Instead, Depop’s Porterie says, “we see our buyers sell on items to keep them in circulation” — which seems to just shift the environmental impact of extra shipping onto the buyer.
Most managed secondhand marketplaces are required to accept returns. Thrift has a 25% returns rate, Essex says, and “tries to avoid pushing excessive consumption by not offering flash sales or huge discounts, which reduces returns”. Responsible says its return rate is around 15%.
Then there’s the packaging problem. According to the Ellen MacArthur Foundation, just 14% of plastic packaging is recycled globally. The rest is burnt or thrown in landfill.
P2P marketplaces ultimately have less direct control over this, but Vinted’s Žvirblytė tells Sifted it’s working on a plan “to address the impact from key areas such as packaging”. She didn’t add further details.
Similarly, Depop also says that one of the ways it’s looking to build more sustainable shipping practices is by “looking into potential suppliers who can support sellers to offer sustainable packaging”.
For managed marketplaces like Thrift, the power is in its hands. Essex tells Sifted that all its packaging is made from compostable plastic, generated by carbon-neutral plantations in Brazil, and can be recycled at home.
But, by a quirk of a new law in the UK coming into force in April, the carbon footprint of Thrift’s packaging is about to rise. The Plastic Packaging Tax means that all plastic packaging must contain at least 30% recycled plastic, which has a higher carbon footprint than the compostable material the Thrift currently uses.
Are consumers really buying less new?
“At a basic level, secondhand fashion is more sustainable than new as it’s reusing existing products,” Thrift’s Essex tells Sifted. “However, this all depends on whether buying secondhand clothes displaces the demand for new ones.”
There’s some evidence that it has. Online luxury fashion marketplace Farfetch found in 2019 that 57% of consumers bought fewer new clothes when buying preowned fashion. And, while the demand for new fashion is growing, some reports say the secondhand clothing market is growing 11 times faster.
But not everyone is convinced. Kantar’s Smith tells Sifted that fashion brands are “probably not yet” producing fewer clothes as a result of the rise of secondhand marketplaces. According to one report, the size of the fast fashion industry will more than double to hit $200bn by 2030.
Nevertheless, a number of P2P marketplaces in Europe have hit scale in recent times, as secondhand fashion becomes ever more fashionable.
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Depop was acquired by Etsy for $1.6bn last summer and Vinted raised €250m in May 2021 to reach a valuation of €3.8bn. France’s Vestiaire Collective, which is a P2P marketplace for premium secondhand fashion, also became a unicorn last year.
Managed secondhand marketplaces are a more nascent group of startups in Europe, and are yet to raise the big bucks from investors — or prove they can scale. Thrift has been around since 2017 and has raised $1.6m, and Responsible launched just last year, snapping up a $6.4m seed round in January.
“The secondhand fashion industry is still in its infancy, a lot like ecommerce was 15 years ago,” according to EQT’s Brochado. Buying and selling preowned clothes online is still “full of friction, because no part of the ecommerce infrastructure has been developed for secondhand”.
But, she adds, as consumers become ever more aware of the environmental impact of their purchasing habits, there are major opportunities to tempt consumers away from new clothes if secondhand marketplaces can make the model work.