RealReal Trades in Last Year's Fashions for Cash
SAN DIEGO (TheStreet) -- Look at your closet. Do you have any of last season's Chanel, Prada or Gucci collecting dust?
Now look again, but this time picture dollar signs.
TheRealReal.com, a consignment website for luxury goods, will happily take those designer dresses, shoes or handbags off your hands, resell them and turn your pricey but oh-so-outdated fashions into cold, hard cash.
"All of a sudden the things you have in your closet, you have liquidity for. People sometimes get thousands of dollars," says Julie Wainwright, CEO and founder of TheRealReal, a site she calls the premier destination for luxury resale.
Created about three years ago, TheRealReal is designed to give eBay a run for its money in luxury goods resale by offering something eBay doesn't: authentication of the luxury items sold on the site.
The RealReal has a full-time staff of authenticators, horologists, licensed gemologists and art curators who inspect and authenticate every high-value item sold on the site, Wainwright says. But that's not the only difference she sees.
"We will pick up stuff in 16 cities. We try to make it really easy," Wainwright says. "If you want to send your items in direct, we will send a prepaid shipping label, and then we do all the work."
TheRealReal pays consigners 60% of the sale price for their goods. Make $7,500 from selling items on the site and your consignment rises to 70% of the sale price.
Nearly 80% of the products on the site sell within the first month, Wainwright says. Payments are made to sellers on the 15th of every month. It's that simple.
It's a model Wainwright says will change the way people look at shopping for luxury goods and the way they look at unwanted luxury items.
If Wainwright is correct, she stands to make a lot of money. There's a substantial market for her to chip away at when it comes to the sale of luxury goods.
"I studied data about eBay. The site sells between $2 billion to $4 billion of luxury goods a year. And they have a lot of trust issues, and they're still able to create a marketplace," says Wainwright, who began her career at Clorox in brand management and spent 30 years in the tech world, working her way eventually to CEO.
Wainwright found support for her site in research done by Bain & Co. as part of its Luxury Goods Worldwide Market Study, which found that $50 billion worth of luxury goods are shipped into the United States each year.