Madewell Is Reselling Its Own Used Jeans Via a Partnership With Thredup

Photo: Courtesy of Madewell

Madewell began its commitment to extending the lifecycle of clothing long ago with its "Blue Jeans Go Green" denim recycling program: When you donate any pair of jeans, you're given $20 off a new pair. (Could that then fuel unnecessary consumption? Sure, but few recycling/sustainability programs are perfect.) It also launched a fair-trade denim capsule earlier this year. Starting Monday, Madewell is taking that commitment to circularity a step further through a partnership with ThredUp, the massive secondhand online retailer.
They've collaborated on "The Madewell Archive," a collection of pre-owned jeans that Madewell sourced from Thredup. Each pair was hand-selected, washed and refurbished and, now, placed into select stores for sale for $50 a pair — quite a bit cheaper than a new pair of Madewell jeans, which are typically around $130. They'll be available in select stores in Austin, Chicago, Nashville and NYC starting on Oct. 14 and California starting on Nov.1.
"At Madewell, we're on a mission to create the longest, most sustainable lifespan for our denim, whether you're purchasing a new pair that are made through sustainable practices or recycling old ones through our longstanding denim recycling program," said Anne Crisafulli, head of merchandising at Madewell, in a statement.
"At ThredUp, our mission is to extend the life of clothes through resale," added Karen Clark, VP of partnerships at Thredup. "When a brand as loved as Madewell embraces secondhand, it says a lot about the evolution of fashion and the promise of a more circular future."
The news fittingly follows parent company J.Crew's recent announcement that Madewell is being spun off into its own company, which will be taken public with an IPO. As part of that process, the brand released a prospectus that majorly emphasizes the brand's commitment to sustainability.
Meanwhile, as Thredup has raised money and expanded, it's pursued a number of partnerships, including with Reformation and Cuyana, wherein Thredup essentially powers recycling programs for each brand: Shoppers receive or can print a Thredup shipping label, send in unwanted items and receive credit to use at that brand. More recently, it partnered with Macy's and J.C. Penney, both of which are selling used items from Thredup in their stores. Madewell marks the first brand to resell its own items via Thredup, but it's a model we could see becoming more common so long as the items aren't overly trendy and are, well, made well, so that they hold up — both qualities we should all be looking for in our clothing anyway to ensure it lasts.  oa here

The RealReal shows strength of its secondhand luxury model in first post-IPO report

Analysts are bullish about The RealReal even after department store discounts posed a threat:

Analysts are bullish about The RealReal despite the unexpected discounted in the luxury market

RealReal Inc. stock soared after earnings indicated that even when luxury goods are sold at a discount, The RealReal’s secondhand goods are still in high demand.
The RealReal REAL, +0.84%   reported sales in line with expectations during its first quarterly announcement post-IPO. Gross merchandise volume (GMV) rose 40% year-over-year to $228.5 million.

Shares were up in Tuesday after-hours and in Wednesday premarket, though they fell about 5% in early trading alongside many others after concerns about global economic data.
The RealReal stock began trading on June 28.
“We view the positive after-market stock reaction reflects some easing of investors’ concerns on higher promotions in the luxury space weighing on The RealReal’s growth trajectory,” Cowen analysts led by Oliver Chen wrote.


“We acknowledge that average order value (AOV) was flat year-over-year due to earlier-than-expected promotions in the luxury space. However, management highlighted promotional trends in 3Q appear similar to prior years and they expect AOV in 3Q to improve year-over-year.”
Analysts say they’re “encouraged” by the loyalty of the customer base and its progress in automation.
The RealReal’s Chief Executive Julie Wainwright said department store discounting isn’t new for the company and it has already seen a fast recovery. The impact is felt more in women’s clothing.
“I would say if department stores get desperate in September, October, we might have some of that tension, again that will be offset by high seasonality,” she said on the earnings call, according to a FactSet transcript.

“[T]his this is one of the beauties of having product diversity because we don’t see it on fine jewelry, watches, men’s and streetwear, and even women’s handbags,” she said.

“While 2Q AOV was modestly below expectations due to increased promotional activity across the industry, management believes the company is partially insulated from periods of aggressive discounting given its category diversification, and the inverse relationship between pricing and active buyer growth,” wrote Stifel analysts in a note.
“As the leader in the luxury consignment space, we believe The RealReal has strong growth potential and ongoing investments in automation should drive operating leverage in pricing and fulfillment.”
Stifel rates The RealReal shares buy with a $30 price target.
The RealReal shares have fallen 44.6% over the past month while the S&P 500 index SPX, -2.93%   is down 5.8% for the period.

 OA here

Amazon Admits to Having a Counterfeiting Problem

image: Amazon

Amazon admits that it might have a problem with counterfeits. For the first time ever, the Seattle-based e-commerce giant made mention in its annual 10-K filing of the elephant on its platform: fakes. In a single line in the “risk factors” section of the yearly report it files with the U.S. Securities and Exchange Commission, the Jeff Bezos-owned company stated, “We may be unable to prevent sellers in our stores or through other stores from selling unlawful, counterfeit, pirated, or stolen goods, selling goods in an unlawful or unethical manner, violating the proprietary rights of others, or otherwise violating our policies.” 

The arguably long-overdue admission comes amidst mounting criticism of and a growing number of lawsuits filed against the world’s largest e-commerce platform, most of which have accused Amazon of being “complicit” in the widespread sale of counterfeit goods on its site. These qualms have largely followed from Amazon’s 2014 move to enable China-based entities to sell directly to Amazon shoppers in the West, and in the process, growing its sales by a whopping 20 percent in a single year and enabling its total revenues to blaze past the $100 billion mark for the first time.

To date, Amazon-specific criticism has come from a multitude of sources, including this website, which questioned the merit of its “zero tolerance” policy when it comes to fakes in light of the fact that searches for things, such as “Fake Gucci” bags and “replica Birkin” bags, readily return results for counterfeit goods.

Independent sellers — forced to directly compete on Amazon’s marketplace with scammers who blatantly steal their intellectual property — have spoken out. Casey Hopkins, the founder of industrial design firm Elevation Lab, penned a highly-cited post on his website last year, calling out Amazon for directly profiting from the sale of fakes.

Brands also have not been shy about taking the $1 billion giant to task. Birkenstock, for instance, publicly cut off Amazon, not once, but twice, “terminating  [its] business relations with Amazon” in the U.S. and the European Union, due to Amazon’s alleged failure to commit to “proactively policing its site for counterfeits.”

Still yet, at least one trade group, the American Apparel & Footwear Association, has urged the U.S. Trade Representative to include Amazon’s international arms to its annual blacklist of “Notorious Markets,” asserting that its “members are growing increasingly frustrated with how [Amazon] protects their intellectual property.”

These complaints, among others, have coincided with legal action. Mercedes Benz’s parent company, Daimler AG, filed suit against Amazon in November 2017 on trademark infringement grounds, claiming that in additional to its problematic marketplace, Amazon’s model for labeling products as “Shipped from and sold by Amazon.com” amounts to a “fraudulent business act.” In particular, Daimler asserted that by using the “Shipped from and sold by Amazon.com” model,  “Amazon itself sells infringing items” and “capitalizes upon and profits from Daimler [and other brands’] reputation and goodwill.”

Less than a year after that legal battle was initiated, fashion brand Ella Moss filed a trademark infringement suit against Amazon, alleging that the giant launched a similarly-named private label, Ella Moon, with a similar aesthetic and lookalike designs  in an effort to confuse consumers and steal sales from Ella Moss.

All the while, Amazon’s PR team has been adamant that it “strictly prohibits the sale of counterfeit products and invest heavily – both funds and company energy – to ensure our policy against the sale of such products is followed.”  

According to CNBC, the newly-added acknowledgement of counterfeit goods in its 10-K filing “reflects Amazon’s increased concern over the counterfeit problem on its marketplace, as the words ‘counterfeit’ and ‘pirated’ were never mentioned in its annual filing before.”

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Life Funded by Selling Luxury Designer Counterfeit Labels

A dishonest businessman who funded a luxury lifestyle by running a large-scale counterfeit designer clothing company has been jailed.

Vinay Kumar Hansrani (48) splashed out some of the profits of his "sophisticated and successful illegal business enterprise" on several cars including an £187,000 Rolls-Royce and an Audi A5 – while declaring profits to the taxman of just a few thousand pounds.
Leicester Crown Court was told that when city council's trading standard officers raided his factory, called Can, in Halkin Street, Belgrave, Leicester, in December 2011, they seized nearly 6,000 counterfeit items with an estimated retail value of between £239,000 and £478,000 – although Hansrani's cut would have been about £100,000.

In a 20-month period, £364,000 of unexplained cash went into his bank accounts.

'The whole place was full of boxes of counterfeit items'

He spent the money on a £187,000 Rolls-Royce

Jane Sarginson, prosecuting, said that when the premises were raided three embroidery machines, worth £30,000 each, were churning out clothes with fake designer logos, including Armani, Gucci, Boss and Ralph Lauren.
"It was a work in progress," she said, "The whole place was full of boxes of counterfeit items, from top to bottom, on both floors."
Ms Sarginson said supplies were delivered nationwide, including to numerous customers in Manchester, but also Glasgow, London and Exeter for onward sale by warehouses and retail outlets. Hansrani (48), of Hall Close, Kibworth, was jailed for two years. Sentencing, Recorder Heidi Kubik said she took into account the six-year delay in bringing the case to court and his ill health.
She said: "It was entirely your own enterprise and you were blatantly spending money from profits on several separate transactions on several vehicles, including a Rolls-Royce.
"It was a sophisticated and successful illegal business enterprise."

What the defendant pleaded guilty to

Labels found at the factory

The defendant pleaded guilty to 29 counts of possessing trademark logos and labels, relating to world-famous designer brands including Boss, Barbour, Diesel, Fred Perry, Lacoste, Gucci, Superdry, Tiffany & Co, Adidas and Nike.
He also admitted three counts of application of a trademark, by using a sign likely to be mistaken for a registered trade mark.

He admitted possessing three embroidery machines adapted to make copies of trademarks.
Hansrani pleaded guilty to money laundering of £198,000, relating to car purchases, between March 2011 and April 2012.

'He recognises the stupidity in going into counterfeiting'

Vinay Kumar Hansrani outside Leicester Crown Court

Nicholas Flanagan, mitigating, said that before 2011, Hansrani ran a legitimate family business in textiles.
When a major customer went out of business, the defendant was forced to make redundancies which caused "significant hardship".
Mr Flanagan said: "He now recognises the stupidity in going into counterfeiting to keep his business afloat."
The barrister disputed the estimated value of the goods seized. He said Hansrani accepted being "a key integral part" of the black market chain, but he also had legitimate contracts, including supplying clothing for schools.
The money laundering related to five or six transactions with car dealers and the Rolls Royce was bought with a view to using it for weddings, which never got off the ground and he sold it having done less than 10,000 miles in it at "a considerable loss."
Mr Flanagan said the six-year gap between arrest and sentence had a detrimental effect on Hansrani and his family, resulting in ill-health, stress and anxiety.
References spoke highly of him as a churchgoer, charity fund-raiser and voluntary work. He was no longer running a business but working in a warehouse to support his family.

'It was a long and complex inquiry'

A number of branded hoodies were found in the factory

Afterwards, Ron Ruddock, manager of the city council's trading standards department, said: "We are pleased with the sentence. Mr Hansrani was given a significant reduction for his personal circumstances and the delay in the prosecution.
"It was a long and complex inquiry into this sophisticated operation that saw goods going in blank, being embroidered and coming out branded.
"We prosecute such cases not just to protect the brand-holders but legitimate businesses and traders who comply with the law."

The delay in the complex investigation was due to a number of factors, explained Ms Sarginson, including obtaining statements from all 29 designer brand companies to confirm sample goods were fake.
It involved following a financial trail with limited departmental resources due to "austerity measures," tracking down more than 70 trading contacts, of which only four turned out to run legitimate businesses.

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