Consumers’ appetite for luxury goods knows no bounds, and the rise of resale is undisputed.
Online platforms selling pre-owned goods have drawn in shoppers from all walks—from avid luxury aficionados to casual deal-seekers.
At the top of consumers’ Most Wanted list are premium handbags. Iconic and irresistible, satchels and totes from the world’s most well-known fashion houses never fail to draw admirers.
Rebag, a company helmed by CEO and founder Charles Gorra, has modeled its business on the resale of these precious and pricy products.
Unlike other resale platforms, which often operate on a consignment model, Rebag buys bags from shoppers outright. Sellers simply upload photos of their luxury bags and fill out a quick questionnaire before sending them off for authentication, and ultimately, for sale.
Now, the company has further simplified the process with a new appraisal index called Clair, Gorra told Sourcing Journal.
While the process of selling a bag to Rebag is fast by all accounts (usually taking one to two days for the company to authenticate and pay sellers for bags shipped by mail, and just an hour for those dropped off in store), Gorra felt that luxury customers needed a solution that was near instantaneous.
“We heard from customers that they didn’t want to wait an hour. They wanted things faster, and that’s why we came up with Clair,” he said.
The software program gives sellers an “instant, immediate view of the value of their luxury goods,” he explained. Likening the assessment tool to Kelly Blue Book for automobiles, Gorra said Clair makes it easy for would-be sellers to gain an understanding of what their luxury goods are worth, and how much they stand to earn by selling them through Rebag.
Selling with Clair begins with a guided navigation through through designer, model, style and size, he said. Once the system identifies the bag from an index of more than 50 brands and 10,000 styles, the user must input additional information regarding color, accessories and condition.
“And right there, we auto-generate the price for you. It doesn’t need any pictures, and it takes less than 30 seconds to go through the whole process,” Gorra assured.
The bags must still undergo a physical authentication process, Gorra said, but barring any issues related to condition or authenticity, the price that a seller is quoted online is what they stand to receive. Sellers can either mail in their bags for review or bring them to a Rebag store, he said. Payments for in-store dropoffs are processed immediately, while mail-ins take up to two days.
Gorra said Clair has been performing well for Rebag, though any new process is not without its hiccups. Discrepancies between the bags that the company receives and the descriptions issued by sellers arise with reasonable frequency, he said.
“There may be a difference in the condition, or a user may have used the wrong Clair code—we tell you the discrepancy, and basically issue a requote,” he said of the company’s process for troubleshooting these issues. “There is a tendency for consumers to overestimate the quality of the condition of their bags, and it’s better if they’re more conservative or realistic so that they’re not disappointed if we have to change the assessment once we receive it,” he added.
Despite any process challenges, the instant-sale model is proving preferable for sellers who are eager to part with their unwanted goods, Gorra said, rather than “waiting weeks or months to get paid as you would on consignment.”
Rebag owns and holds all of its inventory, and that makes for a delicate balancing act when it comes to supply and demand.
“It’s challenging and complex to execute on our end. It’s great for the customer that we pay upfront, but we own the product, and we need to move the product, preferably fast, and at or as close as possible to the expected price,” Gorra said.
Rebag relies on machine learning to inform its buying decisions—as well as the prices being quoted to sellers. “We’ve become experts at this because we’re so category focused,” he explained. “We’ve collected a ton of data on what sells and what doesn’t,” he added.
Online and offline inventory management systems allow analysts a dynamic view of the company’s stock at any given time, he said.
While Gorra declined to go into the specifics of the company’s authentication processes, he asserted that ReBag is “very committed” to combatting the issue of counterfeits on the luxury resale market.
“We have our own team, and a multi-layered system of experts as well,” he said of the company’s authentication infrastructure. He added that the team errs on the side of caution when it comes to accepting merchandise, and offers Rebag shoppers a lifetime money-back guarantee should an issue arise with their purchase.
The resale of luxury goods stands only to grow, experts say, but authentication could prove a thorn in the category’s side.
Wunderkind company The RealReal, a San Francisco-based startup that has risen to prominence on the promise of authentic designer goods at a fraction of the price, has come under fire in recent weeks due to counterfeit complaints from disgruntled consumers.
On Thursday, a CNBC report revealed the existence of an internally circulated 227-page document that highlighted a sampling of fakes that managed to evade the company’s vetting process—and were ultimately sold to consumers. Dubbed “Copywriting Faux and Tell,” the memo served as “a weekly recap of TRR published and returned counterfeits.” The outlet asserted that the goods were actually being certified by copywriters untrained in the nuanced art of luxury authentication.
While The RealReal has declined to share the specifics of its training programs and certification processes, CEO Julie Wainwright previously claimed that all of the site’s goods were guaranteed “100 percent authentic.”
In a recent email to customers following the first CNBC revelations on Nov. 5, though, Wainwright walked back her assertion, saying, “we strive for perfection but we may not be perfect every single time.”