Have you ever looked in your closet and realized that you had so many clothes that you didn’t even wear? A former Harvard Business School student, James Reinhart, looked into his closet and tried to solve that problem. By launching a web-based company to make swapping adult clothes easy called ThredUp, Reinhart also realized that adult clothing was not the right market to enter.

According to Bloomberg Businessweek, Reinhart realized that right market to tap into was kids’ clothing. Reinhart stated, “Once you start dipping into the data, it turns out to be a $6 billion-a-year market.” According to U.S. Agriculture Department data and a survey of 412 mothers conducted by ThredUp, the average American spends approximately $14,300 on clothes and grows out of about 1,300 items by the age 17.

As a kid-to-kid clothing swap service, San Francisco based ThredUp was re-launched in April 2010 and has tapped into a secondhand market. As a member on the ThredUp site, sellers follow a two set process: package 15 “new to you” items in a box and input the items by brand, gender, size, and style on the site.

The purchaser or “thredders” can easily purchase the 15-item package for only $5, not including the cost of shipping, and contribute to the “thredding” processing by selling their own items one day. To gain access to newly posted boxes, shoppers can become premium members for only $30 a year. Instead of buying secondhand, Reinhart estimates shoppers can save $50 per box using ThredUp swapping clothing.

As of July 2010, ThredUp has signed up nearly 200,000 members across the U.S. with a growing rate of 1,000 members per week. ThredUp members not only spend a total of over $8,000 per day on shipping but also have given the company a chance to recycle more than 50,000 pounds of clothes.

Expanding into toy sway last December, ThredUp members begin trading children’s books just last month. With millions in investment led by Red Ventures and the former EBay Chief Executive Officer Brian Swette as advisor, ThredUp may enter at least one European or Asian market before the end of 2012 says Reinhart.

SwapBabyGoods.com and Zwaggle.com are other sites that encourage the swapping of kids clothing. The three competitive advantages ThredUp exercise are the opportunity for their members to have access to thousands of boxes of goods instead of goods just from one use; prepaid mailing labels and empty boxes directly to users’ homes; and the reduction of postage due to packaging several items together.

According to Neal Gordenflo, publisher of the online magazine Shareable, ThredUp has “cracked the nut and proven their model works…and that the swap business can be scaled up.”

Eventually ThredUp will enter different markets beyond swaps, Reinhart says, “The American mom is the most powerful consumer in the world. In a world where we have a lot of moms who are just an e-mail away for us, there are a lot of opportunities.”

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About the author

Antoinette Alexander
I'm a MBA Marketing student with a passion for learning and trying new things. I love to help people and hope to empower others.

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1 Comment for Online Clothes Swapping for Moms

Susan Hall

Found a great service similar to thredup, but more like a netflix for kids clothes. Genius idea! Hope it stays for long. http://bundlesy.com if someone is interested!

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