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As re-commerce surges, how can brands and physical retail lead the circular economy?

Re‑commerce - the online exchange of pre‑owned goods - while still a small segment of European retail, has seen an extraordinary growth trajectory.

According to Statista, the sector has surged from €3.4 billion in 2017 to around €44 billion today. By 2029, fashion re-commerce alone is expected to surpass entire e‑commerce markets such as toys & hobby, eyewear, and household essentials.

Much of this growth has been fuelled by platforms like Vinted, Back Market, and Refurbed. In France, Vinted overtook Amazon and Shein to become the largest clothing retailer by volume last year, propelled by affordability and the preferences of younger consumers.

A brand response and the physical touchpoint

As these platforms scale, the strategic implications for brands are hard to ignore. Each resale on a third‑party marketplace means losing control of pricing, product quality, customer relationships, and brand equity. Brands are now moving decisively to reclaim the second sale, with resale programmes increasingly embedded in physical retail. Patagonia’s worn wear, H&M’s curated in‑store resale, Zara’s pre-owned service, and Nike Refurbished all reflect a move toward brand‑owned sustainable ecosystems  in store.

Beyond just resale, a broader push for circularity is becoming apparent in physical retail spaces. Arc’teryx’s largest European flagship, opened last year in London’s Covent Garden, includes a dedicated ReBIRD™ Service Centre, its first in‑store repair hub in Europe and a substantial expansion of its circular programme.

The motivations are both strategic and defensive: taking ownership of resale deepens customer loyalty, protects pricing power, and unlocks new value from returns and excess stock. Luxury brands have shown how potent this can be, using authentication and warranty-backed programmes (think Rolex Certified Pre‑Owned) to safeguard premium positioning and combat counterfeits. These incentives are only strengthening as regulation tightens: the EU’s Right to Repair legislation and the introduction of Digital Product Passports will make traceability and circularity both operationally attractive and financially rewarding, with emerging tax benefits further sweetening the deal.

Department stores embrace circularity

Change is not limited to brands; luxury department stores are acting too. Galeries Lafayette has integrated circular services throughout its Paris Haussmann flagship, from La Marche du Temps watch and jewellery repairs to the VEJA Shoe Repair Centre. Selfridges has gone even further: what began as Project Earth trials has become a permanent fixture, with all four UK stores hosting Reselfridges departments offering resale, repair, rental, and customisation.

Where resale meets real estate

Ultimately, brand-run circularity cannot live online alone; it relies on physical spaces where products can be collected, authenticated, and repaired. As stores evolve from pure showrooms into service hubs - hosting take back desks, repair counters, grading zones, and curated pre-owned edits - they become important infrastructure for the circular economy.

For landlords, this shift delivers tangible upside: longer dwell times, deeper engagement, stronger cross shopping, and enhanced ESG performance that increasingly unlocks sustainability-linked finance. As brands double down on owning the second sale in the face of fast growing re-commerce platforms, demand will grow for retail environments built to handle these operationally intensive circular systems.

The second sale may start online, but its future will increasingly be felt in the store. Brands that neglect resale risk missing out on revenue and loyalty, while those embracing circularity will turn physical retail into a powerful differentiator – blending experience, sustainability, and trust in ways online platforms cannot match.

 

Further information

Contact Chris Nichols

European Retail Market – 2025

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