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REI executive shares how their resale business is independently profitable: 'We've over doubled the business'

How the recreational equipment company's "recommerce" program is saving shoppers money — and helping the brand grow.

How the recreational equipment company's "recommerce" program is saving shoppers money — and helping the brand grow.

Photo Credit: REI

Buying used gear and clothing at REI can save shoppers 30%-60%, making it a huge draw for customers — and the outdoor retailer says that's becoming a big business for it, too. 

For the first time, an executive from REI told The Cool Down that its "Re/Supply" resale program — offering trade-ins and selling used gear — is "certainly profitable."

In an interview at GreenBiz, one of the largest gatherings of business leaders in the sustainability industry, Laura Kelley, REI's senior manager of recommerce, told us: "We've over doubled the business in the last five years and have plans to continue to grow. We've kept almost 1.5 million items in circulation and in the hands of our members out there last year and expect to do the same this year."

Here's how it works: Customers can buy used equipment or apparel in REI stores and online — and the company has also launched a few dedicated "Re/Supply" stores selling only used goods. REI's 50 million-plus members (who pay a $30 lifetime membership fee), can also trade in eligible items for a gift card credit. 

We spoke to Kelley to learn more about how REI's recommerce business is helping drive up sales, drive down pollution, and help it fulfill its mission of getting more people outside. 

🏠 From garage sales to a profitable business

"We've been in the used gear business for over 60 years with our garage sales that were beloved member events, where we were clearing out all the stuff that had been returned in a liquidation fire-sale-type way. Several years ago we said, maybe we should think about this in a more strategic and purposeful manner, and that's what led us to where we're at today, with really treating this as a business within the broader business."

💰 Why customers love it

"The biggest reason to buy used gear is that it's 30% to 60% off the new price, and you can find great high-quality gear. The trade-in program is a really good way to trade up to something new and upgrade your kit, or progress through an activity.

"Think about the gear and apparel and shoes that are sitting in your closet that you're not using as much, and turn it into something that you can use and that helps us then pass that along to someone else who can get outside and try something new for the first time."

🔥 Hot resale items

"The high-ticket items that REI typically sells also sell quite well for us in our Re/Supply business — things like sleeping bags, tents, packs, that kind of core camp selection. Interestingly, footwear is also a really big category for us. People can get a great deal on hiking shoes or running shoes or climbing shoes."

🌳 Improving access to the outdoors

"Lowering the price barrier to getting outdoors helps us get more people outside, and that's absolutely one of the things that we lean into with Re/Supply. We see that used gear is often someone's first purchase with REI, or it's a way that they try out a new category or activity for the first time."

💚 Attracting younger customers

"In general, we see that younger customers tend to be really bought into secondhand, and they're really increasingly seeking brands and retailers that align with their values. That's showing up in our customer data as well."

💡 Solving a big problem

"This model allows us to get to our broader goals as a co-op, which is serving a 50 million-member community and also reducing our carbon footprint by over half.

"Seventy percent of our carbon impact comes from the manufacturing of the new products that we sell. How can you serve a growing member base and also reduce your carbon impact without stripping the carbon out of the manufacturing process, or finding a better, more sustainable way to get more gear and apparel into people's hands? 

"We look at this as a really great way to welcome more people into the co-op, invite them into the outdoors with used gear rather than new gear, and talk about the benefit for customers to participate in buying used gear."

💸 Saving the company money

"It's a really critical piece of our broader co-op profitability, because a significant portion of what we sell is products that have been returned to the co-op and would be otherwise written off as a loss and end up in the landfill. 

"We have a very generous return policy, 100% satisfaction — you can bring it back to us if you're a member within one year, and if those items aren't first-quality, they can't be put back on the floor and resold as new. They go into our used pool and we're able to recover some of that loss." 

🔮 The future

"We're really committed to this as being a significant portion of our business and continuing to offer this across all of our stores and our online channels. We've opened Re/Supply used-gear-specific stores and have plans to open more in the future." 

🎯 Lessons for brands

"If you are considering a recommerce business, one of the things that's really allowed REI to be successful in this space is treating it as a business, not just a sustainability initiative or a customer program. Really looking at it from a business perspective and making sure the model fits with your values, with your company, with the way you operate — all the sustainability and customer benefits will come out of that. That makes it really powerful. 

"We view new entrants into the space as a good thing because that's shifting consumer behavior overall. And we need to maximize the useful life of all the stuff that's already out there rather than continuing to produce more."

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