Supply chain crisis causes demand surge in resale sites and marketplaces

Resale sales rise

In August, eBay reported a second-quarter revenue rise of 14% to $2.7 billion. Jordan Sweetnam, senior VP and general manager of eBay North America, said the San Jose California-based company is “experiencing surging demand for unique, rare and pre-owned items,” including in categories such as sneakers, watches and refurbished electronics.

“Shortages are already changing the way people shop—pushing the holiday shopping season earlier than ever— though the impact has yet to be fully realized,” he said, adding that “these are behaviors we expect to see amplified through the end of the year and well into 2022.”

Earlier this month, Poshmark, the social marketplace for secondhand goods, rolled out new features to help sellers capture a piece of rising demand. Such tools include enabling more personalization services between sellers and their customers and a dashboard that provides customer data. The company recently posted a 22% increase in revenue to $81.8 million.

Such gains make it a good time to be an individual seller on a platform such as Poshmark or eBay, where regular consumers can stock up on items and resell them for profit.

“There is going to be an availability problem this holiday season,” said Ken Cochran, senior director in the consumer and retail group at Alvarez & Marsal, a global consultancy. “People are going to get creative about the secondary market and it will drive opportunities for those folks.”

Yet not all resale companies are immune to the shipping problems. While StockX, which started as a sneaker resale platform but has expanded to a host of retail categories, doesn’t rely on traditional supply chains, the Detroit-based company still makes deliveries via third-party carriers like FexEx or UPS, shipping products from sellers to buyers. Such carriers might see delays this holiday season due to increased demand for quick delivery. Therefore, StockX is encouraging its customers to shop early, according to Chief Marketing Officer Deena Bahri.

“Luckily, StockX is better positioned to manage delays in the supply chain,” she said. “We’ve spent the better part of this year prepping for the holiday season, and we’re encouraging our customers to shop early with special communications and promotions.”

Microchip shortage boosts used car sellers

A global shortage in the microchips used to make cars has caused major automakers such as General Motors, Toyota and Ford to cut production this year, and the dearth is prompting consumers to explore the used car market.

“With ongoing inventory issues, some late-model used vehicles are currently selling for more than they did brand new,” read a September briefing report from JD Power. “Any owner who is considering taking advantage of the market’s historically high retention values and attractive interest rates should do their research in order to make wise decisions and reap the highest available return.”

Used vehicle seller Carvana recently reported a 198% revenue increase for its second quarter to $3.3 billion, which followed a 42% revenue jump for all of 2020 to $5.6 billion.

“We do have the inventory that people are looking for,” said Ryan Keeton, Carvana’s co-founder and chief brand officer, adding that the company’s marketing focuses on selection, price and experience. “We don’t do promos or APR offers—that’s part of the old way of selling a car that comes with the salesman and is not necessarily the best experience.” Its media buys include TV and digital ads.

While most resale platforms are not overtly calling out the supply and delivery woes that traditional retailers are facing, some brands are beginning to hint at it. Etsy, the Brooklyn-based craft marketplace got creative earlier this week in an email message to customers that appeared to poke at the myriad delays of competitors. The subject line of Etsy’s Tuesday afternoon email read “If delivery times make you <sweat face emoji>.” The text of the message read, “Your Etsy order’s ETA shouldn’t remain behind closed doors. Get bespoke beauties to personalize your pad with estimated delivery dates.” Like resale platforms, Etsy, where many sellers resell vintage goods as well as new creations, has seen revenue rise this year—most recently, it was up 23% to $529 million in June.

Forrester’s Kodali suggests that resale platforms can make more gains this holiday season my keeping a close eye on consumer behavior. “If they do a good job of trying to get ahead, so if they see searches for certain types of items that may be out of stock—like cellphone protectors or leggings—if they’re able to jump on that, and say, ‘Oh, we have those items, we have good almost new versions,’ they would be able to capture some of the lost demand from stock outs,” she said.

Previous post A Week In Central Pennsylvania On A $50,000 Salary
Next post Intuit introduces Money by QuickBooks