A resale program lets you take back gently used or unsold products, either from customers or your own inventory, and resell them through your store, website, or a third-party platform. More retailers are using resale to extend product life, build customer loyalty, and meet growing demand for sustainable shopping.
To launch your own program, you’ll need to decide what items to accept, create a process for intake and pricing, choose your sales channels, and promote it to your customers. With the right tools, you can also track inventory, handle store credits, and stay compliant with tax rules.
In this guide, I’ll walk you through each step on how to start a resale program, so you can build one that fits your brand and your bottom line.
Step 1: Set the foundation for your resale program
Before you start accepting items or setting up a resale display, it’s important to lay the groundwork. That means getting clear on your goals, choosing the right resale model, and understanding any legal or tax requirements that might apply. Starting with a strong foundation will make the rest of your program easier to build and manage.
Set clear goals
Decide on what you want your reseller program to achieve. Are you trying to boost repeat purchases? Clear out returns or excess inventory? Strengthen your sustainability messaging? Your goals will shape how you design and run the program.
Choose a resale model
Once you’ve nailed down the “why,” choose a resale setup that fits your goals, resources, and customer base. There are three common recommerce models to consider:
- Trade-in for credit: Customers return used items in good condition and receive store credit or a discount toward a new purchase.
Real-life example: Levi’s SecondHand is the brand’s first buy-back program, where customers can trade in their Levi’s items for a gift card.
- In-house resale: You clean, inspect, and reprice items, then resell them in a dedicated section of your store or website.
Real-life example: Ikea’s As-Is or Circular Hub is a section where they sell gently used, returned, or ex-display items.
- Third-party resale: You partner with platforms like thredUP, Recurate, or Archive to manage intake, fulfillment, or customer-facing resale marketplaces.
Real-life example: Madewell Forever, powered by thredUP, lets shoppers buy and trade in pre-loved Madewell styles online.
Each model has its pros and trade-offs. Start with the one that best aligns with your team, product types, and customer preferences. You can always expand or adjust as your program grows.
Consider legal and tax requirements
Before you start reselling pre-owned items, it’s important to make sure you’re covered legally and tax-wise. Resale programs come with a few extra layers of compliance, especially when you’re taking back items, issuing credit, or reselling used goods.
Here’s what to keep in mind:
Sales tax on resale items
In most states, pre-owned items are still taxable. That means you’ll likely need to collect and report sales tax just like you would on new merchandise. Some states may have different rules for secondhand goods, so check with your local tax authority or accountant to be safe.
Handling store credit or trade-in value
If you plan to offer store credit for trade-ins, treat it like any other gift card or credit. It’s not taxable until it’s used. Just make sure to track outstanding credits properly for accounting and reporting purposes.
If you will offer cash buybacks (less common), be aware that this might trigger different tax obligations, especially if you’re considered a secondhand dealer in your state.
Secondhand dealer laws and permits
Some states and cities require special permits or registration for businesses that buy and resell used goods, especially if you’re dealing with electronics, jewelry, or high-value items. These laws are meant to prevent theft and fraud, so they may include requirements like:
- Holding items for a set number of days before resale
- Recording customer IDs during trade-ins
- Reporting purchases to local authorities
Check with your city or state licensing agency to find out if these apply to your business.
Liability and product safety
You’re still responsible for the safety of the products you resell. Make sure items are clean, functional, and meet basic safety standards, especially for things like baby gear, electronics, or anything with batteries or moving parts. If you’re unsure, create a short resale intake checklist to avoid accepting potentially risky items.
You don’t need to be a legal expert to run a reseller program, but checking off these basics will help you stay compliant, protect your business, and build customer trust from day one.
Step 2: Choose what products you’ll accept
Not every item is a good fit for resale. Decide early on which products you’ll take back and what condition they need to be in. This helps streamline intake, avoid confusion, and maintain quality standards for your customers.
Start by reviewing your product catalog and identifying categories that hold their value or are easy to inspect, clean, and resell. Focus on items with longer lifespans, consistent demand, and strong resale appeal.
You’ll also need to set clear acceptance criteria. Think about:
- Condition: Will you accept items with light wear? Missing tags? Minor damage?
- Age: Are there cutoffs for how old an item can be?
- Product types: Will you exclude final sale, monogrammed, or intimate items?
- Seasonality: Will you take seasonal items year-round or only during certain months?
Keep it simple at first. You can expand your criteria later once your program is running smoothly.
Step 3: Plan operations and logistics
Behind every successful reseller program is a smooth back-end system. This is where you figure out how items will flow from the customer to your resale shelf (or site) without bottlenecks or confusion. You don’t need a huge team or fancy tools, just a clear process that works for your setup.
Here’s what to think through:
Intake process
Start with how you’ll accept items:
- Will customers bring them to your store?
- Will you accept items by mail?
- Is the trade-in open year-round or only during special events?
Next, decide how you’ll evaluate them. Will staff check items at the counter or send them to the back for review? Create a simple checklist so it’s clear what qualifies:
- No major damage
- Clean and odor-free
- Within your accepted categories (you defined this in Step 2)
Set up a system to check the condition, approve or reject items, and log them into your inventory. A simple intake form or barcode tagging system can help you stay organized from day one. Keep the process quick and consistent. If you’re offering store credit, aim to process and issue it on the spot.
Cleaning, repairs, and prep
Will you clean or repair items before resale? If so, decide what tools, supplies, or vendors you’ll need. For apparel, this could be a garment steamer and inspection station; for furniture, maybe light touch-ups or sanitation protocols.
You don’t need to do heavy-duty repairs, but your resale items should still look clean, usable, and aligned with your brand’s quality standards. Here are some things you can decide on:
- Will you offer basic cleaning (wiping, steaming, airing out)?
- Do you need a small repair station (glue, tools, fabric shaver)?
- Will you label items by condition (like “Excellent,” “Gently Worn,” etc.)?
Build in a basic protocol so items look presentable and aligned with your brand’s quality standards.
Pricing and tagging
Create a pricing system that’s easy for your team to apply and fair for your customers. Your pricing approach should balance profit margins with perceived value and stay consistent enough that customers know what to expect. Here are some options:
- Flat pricing tiers (e.g., $10, $20, $30 racks): This system is simple to set up and great for in-store resale sections; it works best when you have a high volume of similar items and want to keep shopping quick and easy.
- Percentage of original price based on condition (e.g., 40%-60% off retail): This is ideal if you sell items with varied original price points or brand names. This approach helps communicate value clearly, especially when paired with condition labels like “Gently Worn” or “Like New.” It’s particularly useful for fashion, electronics, or gear with recognized MSRP (manufacturer’s suggested retail price).
- Manual pricing for high-value or unique items: Manual pricing is best for one-of-a-kind or high-value pieces, like designer items, vintage goods, or refurbished electronics. It allows flexibility, but can be time-consuming, so reserve it for items that really need special attention.
Make sure your team knows how to tag and label items clearly so customers understand the value. Include the condition and original price if helpful. Color-coded tags or stickers can make it easy to distinguish resale from new inventory.
Storage and organization
Designate space to handle intake, prep, and storage — ideally separate from your new product stock. You’ll need bins, racks, or shelving based on your product type. You don’t need a warehouse, just clear zones:
- Incoming: Just dropped off and awaiting review
- Accepted: Ready to clean or price
- For sale: Fully prepped and tagged
If you’re using a point-of-sale (POS) or ecommerce platform, consider creating a separate product category for resale items. This keeps your reporting clean and helps you track what’s selling well.
Step 4: Select your selling channels
Once your resale items are cleaned, priced, and ready to go, the big question is: Where are you going to sell them? Your selling channels will shape how customers experience your program, so it’s worth thinking through the options before you launch.
Here are a few options to consider:
In-store resale section
If you have a physical store, a resale section is one of the easiest ways to get started. You can set up a small rack, shelf, or display near the checkout or in a clearly labeled area, like a “Pre-Loved Picks” corner.
Pre-loved clothing and accessories can be beautifully displayed and seamlessly integrated into the in-store experience through a stylish secondhand section.
This option keeps everything in-house and gives customers a chance to discover secondhand gems as they browse. Just make sure it’s styled well and doesn’t feel like a clearance bin. Use signage to explain what the resale section is, how it works, and why it’s awesome.
Your website
If you already sell online, consider adding a resale section to your ecommerce store. Adding resale items to your ecommerce site keeps everything under one roof. You can list resale items alongside new ones or give them their own category, like “Gently Used” or “Second Life.”
Most ecommerce platforms (like Shopify, WooCommerce, or Square Online) allow you to tag products by type or condition, so it’s easy to manage. This option gives your resale program 24/7 visibility and can attract budget-conscious or sustainability-minded shoppers. You can also offer bundle deals or loyalty rewards for trade-in purchases.
Online marketplaces
You can also list items on third-party platforms like eBay, Poshmark, or Facebook Marketplace. These reach broader audiences but require more effort per listing and less brand control. They’re a good option for testing resale with minimal overhead. Here are some platforms you can try:
- eBay: Great for rare or collectible items
- Poshmark: Popular for fashion and accessories
- Facebook Marketplace: Easy and local
- Depop: Trendy with younger shoppers
One drawback with online marketplaces is that you’ll likely need to pay seller fees. Still, they’re a solid option for testing resale without much upfront investment. Consider using marketplaces for items that don’t sell as quickly in-store or online.
Pop-ups or seasonal events
Host a seasonal “Pre-Loved Drop” or pop-up event in your store or at a local market. These events are great for clearing out resale inventory, attracting foot traffic, and educating your customers about the program.
You can even theme it, like a “Fall Refresh” swap-in event or “Closet Clean-Out Weekend”, and combine it with trade-in promotions or local partnerships. This is a great strategy if you don’t have space to keep resale items out all the time.
Step 5: Launch your program
With everything set up behind the scenes, it’s time to go live. The launch phase is where you introduce the program to your customers, get your team aligned, and start building momentum. A clear and confident rollout helps your resale program get off the ground with minimal confusion and maximum impact.
Spread the word
Make sure your customers know resale is now part of your brand. Use every channel available:
- Email: Send a dedicated announcement with a quick “how it works” breakdown.
- Social media: Share behind-the-scenes content, trade-in success stories, or a video of how to participate.
- Website: Add a page or banner explaining the program, with FAQs and clear next steps.
- In-store signage: Place signs at the entrance, checkout, and resale drop-off area so walk-in customers can’t miss them.
The key is to make it feel like a benefit, not just a new policy. Focus on what’s in it for them, such as savings, sustainability, rewards, or access to unique pre-loved items.
Offer a launch incentive
Kick things off with a limited-time promo. A small reward can encourage first-time participation. Here are some ideas:
- Extra credit for the first 50 trade-ins
- A discount on pre-loved items during launch week
- Double loyalty points for every resale purchase
- A giveaway for participants (e.g., win a gift card or limited-edition product)
Small perks can go a long way in encouraging early participation. It doesn’t have to be complicated, just something to create a sense of urgency and excitement.
Train your team
Make sure your staff knows how the program works — what items are accepted, how to process trade-ins, and how to talk about resale with customers. Don’t forget to provide your team with the exact set of guidelines that you will make available to your customers. Aside from this, a quick cheat sheet or internal FAQ can make onboarding even simpler.
Here are some details you can include in your internal info sheet:
- What items are accepted (and what’s not)
- How to process trade-ins or returns
- How pricing works for resale items
- How to explain the program to customers clearly and confidently
A well-informed staff means fewer hiccups and better customer experiences.
Resale tools and software
Running a reseller program gets a whole lot easier when you’ve got the right tools behind the scenes. From intake to inventory to rewards, here are the systems that can help you stay organized and scale smoothly:
Your point-of-sale system is the backbone of both new and resale transactions. Platforms like Square, Shopify, and Lightspeed let you:
- Create a separate product category for pre-owned items
- Set custom pricing based on condition or resale tiers
- Process store credit for trade-ins directly at checkout
- Track sales performance of resale vs new inventory
If you’re already using one of these platforms, adding resale items is often just a matter of tagging them correctly. That means no messy workarounds or duplicate systems, just a seamless experience for your team and your customers.
Related:
Managing pre-owned items adds new layers to your inventory process. You’ll want to track not just how many items you have, but also what condition they’re in, when they came in, and how they were sourced.
Most modern POS systems come with basic inventory tracking built in, but if you need something more detailed, consider tools like:
- Stocky (for Shopify): Helps forecast demand, track turnover, and manage restocks—even for resale-specific SKUs.
- Sortly: A user-friendly inventory app that lets you upload photos, track condition, and scan barcodes right from your phone or tablet.
- inFlow: Great for resale operations with multiple locations or larger item volumes.
Related:
Tying your resale program into your customer data helps you do more than just sell. It helps you build loyalty, repeat business, and personalized marketing around sustainability.
With CRM and loyalty tools like Square Loyalty, Marsello, or Yotpo, you can:
- Reward customers with points or perks for trade-ins and resale purchases
- Track who’s engaging most with your resale program
- Send targeted promos to eco-conscious shoppers or resale fans
- Show appreciation to frequent contributors or buyers
One way to make your loyalty program more exciting is to gamify it. Offer badges, status tiers, or surprise rewards for consistent resale participation.
Related:
If you love the idea of offering resale but don’t want to manage all the logistics yourself, third-party services can do the heavy lifting. These platforms specialize in powering branded resale programs, from intake and authentication to listing, shipping, and customer service.
Here are a few worth exploring:
- Trove: Works with brands like Levi’s and Allbirds to run full-service resale programs. Trove handles everything from returns to refurbishment and resale through a dedicated branded platform.
- Archive: Helps you build a white-labeled resale marketplace integrated directly into your site. It’s ideal if you want resale to feel like a seamless part of your brand.
- Recurate: Lets customers list and resell past purchases directly on your website through peer-to-peer resale. You can approve listings and even offer incentives for sellers.
These services are great if you want to get up and running quickly, maintain brand control, and offer a polished experience without building everything from scratch. Many of these plug-ins integrate with Shopify, making setup even easier if you’re already on that platform.
Benefits of a resale program
A resale program isn’t just a feel-good initiative. It’s a growth strategy with real, measurable upsides. Here’s why more businesses are jumping in:
- Boosts revenue without new inventory: Resale lets you generate income from items you’ve already sold or stocked without buying new products to make new sales.
- Increases customer loyalty: Offering store credit or loyalty perks for trade-ins encourages repeat purchases and builds long-term relationships.
- Aligns with sustainability goals: Consumers are increasingly shopping with their values. A resale program shows your commitment to reducing waste and supporting circular commerce.
- Attracts budget-conscious shoppers: Secondhand shoppers aren’t just looking for deals — they’re often brand-loyal, eco-minded, and ready to spend if the value is clear.
- Expands your customer base: A well-executed resale program draws in new shoppers who may not buy full-price but are happy to engage with your brand through resale.
- Offers insight into product longevity: Seeing what customers return and in what condition gives you valuable data to improve product quality, pricing, and future designs.
Challenges to expect and how to tackle them
Resale programs can be incredibly rewarding, but like any business model, they come with a few bumps along the way. Knowing what to expect (and how to handle it) will save you time, stress, and costly missteps.
Here are some common challenges and how to stay ahead of them:
Challenge | Solution | Pro tip |
|---|---|---|
Sorting through low-quality or unusable items |
| Consider offering recycling or donation options for unaccepted items to avoid awkward interactions. |
Inventory overload or bottlenecks |
| Use color-coded tags to track how long items have been in stock, making it easy to rotate, discount, or clear out older inventory. |
Pricing that feels fair but still profitable |
| Use a pricing matrix based on item condition and original price to keep pricing consistent and easy for customers to understand. |
Getting staff buy-in |
| Involve your team in the launch. Let them help shape workflows or name the resale section. It boosts buy-in and engagement. |
Customer confusion or pushback |
| Hand out a quick “How It Works” card with trade-in rules, pricing, and program goals to reduce confusion and build trust. |
Future trends in resale
Resale is no longer just a trend — it’s becoming a core strategy for brands of all sizes. As technology advances and customer expectations shift, resale programs are getting smarter, more personalized, and more integrated into everyday retail. If you’re planning to start now, these are the trends worth keeping on your radar:
- AI-based pricing and intake: Tech is making it easier to instantly assess condition, assign pricing, and automate acceptance, no more guesswork or bottlenecks. Trove and Archive use AI to streamline resale workflows for brands like Lululemon and The North Face.
- Brand-owned marketplaces: More brands are taking resale in-house with branded platforms that look and feel just like their main store – seamless, curated, and fully on-brand. Patagonia’s Worn Wear and REI’s Used Gear sections are fully integrated into their own websites, creating seamless resale ecosystems.
- Resale as a loyalty tool: Trade-ins for store credit, exclusive resale perks, or early access to secondhand drops are turning resale into a retention strategy, not just a side hustle. Levi’s SecondHand encourages circular shopping with trade-in credits that keep customers coming back.
- B2B and rental crossover: Expect resale to blend with rental, subscription, and wholesale resale. Think bulk buybacks, corporate wardrobe recycling, or branded recommerce at scale. Banana Republic and Nuuly are blurring the line between resale and rental with fashion subscription programs that include pre-worn pieces. Banana Republic and Nuuly are blurring the line between resale and rental with fashion subscription programs that include pre-worn pieces.
Frequently asked questions (FAQs)
Click through the sections below to read answers to common questions about resale programs:
It depends on your location and what you’re reselling. Some cities or states require a secondhand dealer license, especially for items like electronics or jewelry. Check with your local business licensing office to be sure.
Offer customers alternatives like donation bins, recycling partners, or seasonal take-back events. This helps reduce waste and keeps the experience positive, even when you say no.
Start with a simple matrix based on the original price and item condition. For example, gently used items could be 40% to 60% off retail. Keep it consistent and transparent.
Yes! Many brands accept trade-ins by mail and list resale items on their own site or through a third-party platform. Just make sure you’ve got a solid intake, shipping, and return system in place.
Items with long life cycles and consistent demand, like clothing, furniture, gear, and accessories, are ideal. Avoid one-time-use or hygiene-sensitive items unless they’re sealed and unused.
Bottom line
Resale is a smart, sustainable way to grow your business. With the right setup, you can boost profits, build loyalty, and extend your product lifecycle without reinventing the wheel.
The key is to start simple. Pick your model, choose what you’ll accept, and create a workflow that fits your shop. From there, it’s all about clear communication, the right tools, and a customer-first mindset.
The sooner you launch, the faster you’ll learn what works and the easier it’ll be to scale. Resale isn’t just good for the planet. It’s good for business.
