Brands Route Returns to Resale Channels to Recover Value, Cut Losses

Quick Facts

U.S. retail returns totaled $890 billion in 2024, accounting for 16.9% of total retail sales.
Platforms like Archive, Treet, and Trove help brands recover up to 80-90% of item value by routing returns to resale.
Archive raised $30 million in Series B funding in February 2025, bringing total funding to $54 million.

U.S. retailers processed $890 billion in returned merchandise in 2024. That number is forcing a strategic shift. Instead of sending returns to bulk liquidators or writing off the value entirely, brands are routing inventory directly to resale channels.

The National Retail Federation projects the return rate will reach 15.8% in 2025, totaling $849.9 billion. In e-commerce, return rates average 24.5%. For apparel and footwear, they often exceed 40%. Processing a single return costs between $10 and $65 after shipping, labor, inspection, and restocking.

The total value of merchandise returns doubled between 2020 and 2025. Brands that once absorbed near-total losses on returned goods now have another option.

Platforms Building the Pipeline

Several B2B platforms have built infrastructure specifically to move returned inventory into resale. Archive, Treet, and Trove each offer branded storefronts, trade-in programs, and resale logistics for retailers and DTC brands.

Archive powers resale for more than 50 brands globally, including The North Face, New Balance, Oscar de la Renta, and Dr. Martens. In February 2025, the company closed a $30 million Series B round led by Energize Capital, bringing total funding to $54 million.

Treet reported that 64 brands launched resale programs on its platform in 2025. Brands already using Treet before 2025 saw resale volume increase 66% year over year. The average resale price across the platform was $89, with an average discount of 37% off MSRP. The median time to purchase a listing was nine days.

Trove works with Levi’s, REI, and Eileen Fisher on in-store trade-in programs. The company says its platform delivers up to a 40% reduction in labor costs and boosts margin 60-80% on aged and imperfect items.

Recovery Rates Climb

Brands using resale channels are recovering significantly more value per unit than through traditional liquidation. Platforms like Arrive allow brands to sell non-new, excess, and damaged inventory for up to 70% of MSRP. Retailers deploying items quickly can recover 80-90% of value compared to near-zero returns through bulk liquidation.

Sustainable apparel brand Pact partnered with Treet to launch its Pact Circle resale program. The brand achieved an 80% sell-through rate on B-grade return inventory and cleared more than 7,500 returned units through the channel.

“Returns are no longer the end point of a transaction,” said Katherine Cullen, VP of Industry and Consumer Insights at NRF. “They provide an opportunity for retailers to create a positive experience for customers and can translate to brand loyalty.”

Archive co-founder and CEO Emily Gittins said the company has addressed a concern that held some brands back: “We’ve debunked the concern that resale cannibalizes full-price sales.”

Consumer Behavior Driving Demand

Demand for secondhand goods is growing. The U.S. secondhand apparel market grew from $28 billion in 2019 to $49 billion in 2024 and is projected to reach $74 billion by 2029. Gen Z consumers, who average 7.7 online returns over the past 12 months, are also among the most active secondhand buyers.

ThredUp chief strategy officer Alon Rotem said the stigma around buying used clothing is fading, “replaced by an embrace of better product value and alignment with consumer values.”

For brands managing high return volumes, resale is becoming a standard part of reverse logistics rather than a last resort. The question is no longer whether to build a resale channel, but how fast to scale it.