Changing the World of Online Consignment

I woke up the other day and went into my living room to watch morning TV.  Shortly after sitting down on my couch, I noticed something was different about the room.  As I scanned my surroundings, I found a rather large turquoise and white plastic bag sitting next to my front door.  Perplexed, I asked my wife what the bag was.  I learned that the bag was associated with an online consignment store called thredUP and that my wife had been filling this turquoise and white bag with old clothing off and on for about 3 years.  I was immediately interested in the concept and how a company took a traditionally offline model and turned it into a growing digital business.  I figured the best way to learn about the ins and outs of the online consignment business was through a long time customer, my wife, Sydney.  The following conversation outlines what makes thredUP and online consignment unique in the eyes of the customer.


Q: How exactly does thredUP work?

Sydney:  It’s pretty easy.  All you need to do is order a bag from their website and they mail it to your house.  Once you have filled the bag, you put it outside and FedEx will come pick it up for you.  ThredUP will then email you to confirm they have received the bag and give you an estimate for processing time.   It typically takes them around 30 days to go through all of the clothes that you have sent and anything they don’t accept they will recycle or donate. One thing to note is that thredUP is picky about the quality of clothes and typically accepts less than 50% of what is sent to them.  If thredUP approves an item, they place it into one of two categories, upfront or consignment.  If it’s an upfront item, it means that it’s in-season and you’ll receive a payout as soon as they receive the bag.  A consignment item is typically offseason and therefore you won’t get paid until it sells.

Q: What makes thredUP better than alternatives?

 Sydney: I would consider threadUP’s two main competitors to be Poshmark and eBay.  With both of those websites, you have to take a picture of all of your items, write up a description, and post it yourself.  However, threadUP has really simplified and improved the customer experience from the seller’s side by doing all of the leg work for you.  ThreadUP also often pays the seller before items actually sell furthering the trust and relationship between the brand and the seller.

Another competitor that’s non-digital is the traditional consignment shop.  I’ve gone that route before, but they won’t pay you until your clothes sell, and if they don’t sell, they make you take it back.  I’ve had a couple of dresses that I’ve worn to weddings that thredUP has marked as consignment, and even though I didn’t get paid right away, I knew I would eventually receive something because thredUP’s online presence allows for a larger audience of potential buyers than traditional consignment.

Q: Do you shop at thredUP as well or just sell your clothes?

 Sydney: When cashing out, you have the option to take your profits in cash or receive a higher amount in thredUP credit.  The only turnoff I have with the site, is that the clothes look like they were just taken out of the bag when the picture was taken.  That being said, they do have over 25,000 brands, and the price points are really good.  Additionally, all of the clothes are organized by type of clothing and brand, which definitely makes the thredUP online experience much better than eBay and traditional consignment.



While thredUP has yet to turn a profit, they’re growing in popularity and brand awareness.  This growth is largely in part to the improved customer experience for both buyers and sellers that can only be provided by a business that operates on a digital platform.  With the growth of the sharing economy, there has also been growth in the digital consignment industry, as shoppers look at consignment as a way to rent or lease clothing for a shorter period of time.  Beyond their digital business presence, thredUP also has a large presence on social media.  ThredUP relies heavily on user generated content on their social channels, which act like visual reviews of their products helping to build trust in their brand.  ThredUP has leveraged everything from unboxing campaigns to pictures of customers wearing thredUP outfits with the brand hashtag #secondhandfirst.  ThredUP wasn’t the first to bring the resale of clothing items to an online platform, but they are the first to perfect the online customer experience aspects of digital consignment.  It will be interesting to see if thredUP can continue to capitalize on the growing preference to online consignment.


  1. Nice post. I think this is a great idea by ThredUP and a great way to enhance collaborative sharing. The fact that competitors like eBay and Poshmark require more effort on behalf of the seller, might encourage customers to switch to ThredUp or encourage them to use the platform. Since they seem to have created a great online experience for the customer, I wonder whether they would be successful introducing this platform outside the U.S like eBay did and perhaps other competitors. I had not heard of ThredUP before reading your blog, but so far I see that the only country they ship to internationally is France, and I really wanted to try it in Israel :( I hope they will expand their services in the future.

  2. I really like this idea because it definitely does play into the sharing peer-to-peer economy that is thriving today. I’ve never personally sold clothes through consignment stores but my friends who do really like it so I will definitely be recommending this to them to try. The only thing I was concerned about while looking at their website was the sizing. Because they have so many brands it could definitely be a struggle to pick the correct size. I think this is where brick and mortar has an edge. Overall this is a great idea and the convenience factor is very appealing! Thanks for sharing!

  3. Nice post. Curious if you went on Tech Trek? The founders of ThredUp are BC alumni and are a frequent stop on the Tech Trek tour. I got to visit their offices the year I went.

  4. laurencondon23 · ·

    Really enjoyed this blog. I agree that ThredUp absolutely has an advantage over competitors in the online consignment space due to the convenience they offer that their competitors have yet to match. The fact that they currently only sell clothes for women and children makes me believe there is room for them to grow into men’s clothing as well. Interested to see how the company does going forward!

  5. jordanpanza29 · ·

    I had never heard of ThredUp so went on their website after reading this post. I think this is a really great business model for the consumer as you can not only shop by designer , like you mentioned in your post, but you can also shop by seller. I think that is a huge plus as you can then start to know what quality you will be getting as a seller normally treats all their clothing at the same level of care. I do wonder if they will try to have stores as well. While online is great, I know I personally love the concept of walking around a store some days. Even though they only have one of every item having online and in store could work. TJ Max which is known for having random items of clothing, has in store locations and online and has managed for both entities to be successful.

  6. ItsUlker · ·

    Great post, love the unconventional format! We got to visit one of their warehouses during TechTrek – the scale of their operations is truly impressive, and they are planning to expand it significantly. I also like how they pay a lot of attention to their branding and packaging, and generate a lot of marketing campaigns, as it really helps build and reinforce a positive brand image. It will be curious to see how their business grows and evolves. I wonder if ThredUp will become a sort of a household name and a part of any customer’s shopping experience (buy, then re-sell). It sounds easier than it is because it involves is a bigger shift in the shopper’s mindset, as the customers will have to factor the possibility of a future payout into their buying decision. I think if succesful, ThreadUp has the potential to disrupt the whole shopping expereince.

  7. Really interesting post Ben – I wasn’t aware of this was a thing, but it makes a lot of sense. I think it is great that they ask the consumer to write up the description and that they use this to categorize the items by brand and type. It seems like this would save a lot of time/effort compared to traditional consignment stores. It is interesting on their website that you can’t really click on anything without providing your email or Facebook information. It also seems like they don’t really have a mens section, which I guess isn’t too surprising (given your references to how useful it is for dresses for weddings etc.).

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