Rental and second-hand markets contribute nearly £7bn to UK economy

A study by Barclaycard Payments has found that UK retailers are benefiting from the growing recommerce economy. 76 percent of retailers now offer more sustainable shopping formats that include rental, reuse and resale offerings.

Barclaycard Payments partnered with Development Economics to combine thousands of responses from UK consumers with demographic, retail and economic data from the Office of National Statistics to calculate the true value of the recommerce economy. The analysis found that the growing trend toward more conscious consumption has contributed significantly to the UK economy, bringing in £6.99 billion (€8.02bn) in the last 12 months alone. Analysis of the recommerce market found that this activity provides 49,000 jobs across the UK retail sector and accounts for 1.6 percent of the total UK retail market.

The rise of the resale market shows no signs of slowing, with four in ten consumers more likely to buy used or rented items than new than a year ago. Another 57 percent say their recommerce shopping activity has remained stable, suggesting that the way consumers shop will continue to change.

The report also found that 82 percent of businesses offering rental items have seen an increase in sales since they started, with another 89 percent increasing their customer base and a similar percentage (87 percent) seeing an increase in profits. Those offering such services report that, on average, one-third of their revenue now comes from rental models.

Circular offerings prove a success

The resale economy is expanding beyond traditional methods as businesses bring resale in-house. Of the companies offering a more sustainable service, 29 percent provide a platform where customers can resell goods they have already purchased, which the company then resells as used products. A similar number (31%) offer customers the opportunity to recycle products in-store, while three in ten retailers offer a repair service so customers can extend the life of their items.

Innovative retailers offering a more sustainable service have also introduced “swap meets,” where customers can trade items purchased in-store with others (18%), as well as resale platforms that allow customers to resell goods even if they were not purchased in-store (22%).

Industries at the forefront of recommerce

More than two-fifths of U.K. retailers have a resale option in place, and another 27 percent are currently considering introducing one, according to the survey. Of those offering resale, the following industries are the most popular:

• Entertainment and electronics (47%)
• Clothing and accessories (43%)
• Home décor and houseware (41%)
• Baby care and children’s market (35%)
• Sports and fitness equipment (32%)
• Pet items (18%)

The sharp rise in cost of living is one of the most important motivations for retailers to offer second-hand or rental offers in order to cushion the financial pressure by offering more affordable shopping options to their customers (46 %). Sustainability is also at the forefront as a motivation for making the change: One in three retailers offering more sustainable shopping options note a change in consumer behavior that increases demand for more diverse offerings (33%), while nearly half (46%) want to minimize their store’s impact on the environment.