The RealReal online start-up was launched in 2011, and in 2018, looking to grow its physical reach, opened a new store in Los Angeles, on Melrose Avenue. The luxury consignment shop already has a store in New York, in the SoHo neighborhood, and according to the CEO and Founder of The RealReal, Julie Wainwright, the recent Series G financing round that raised $115 million will enable the company to open more stores.
The RealReal’s expansion comes at a time when luxury brands are seen as top performers in the industry, having the most sought-after businesses. Wainwright noted that the plan behind The RealReal was to change people’s perception about what a consignment store looks like. She went on to mention that some of her smartest and richest acquaintances buy from consignment, because they appreciate good value, but they never talk about it.
While their store in SoHo is relatively small, the new store on Melrose Avenue is an impressive 12,000 square feet. It will feature a portion of 5,500 square feet dedicate to men, and 1,500 square feet will be used to display handbags. The store is close to Glossier, Away, Nordstrom Local, and other e-tailers that are taking spaces that previously belonged to bankrupt brands such as RadioShack and Toys R Us.
In addition, the store will also provide a number of services. On site there will be authentication specialists that are available to offer free handbag and fine jewelry valuations, people will be able to take certain items to be repaired there, and there will also be a service that offers shoppers the chance to drop any items they want to sell.
The founder of The RealReal mentioned that the company is negotiating in a number of markets at the moment, in order to open additional stores, but they are looking for spaces that are big enough and have the right amount of character. The whole apparel resale market (both online and offline) was valued at $18 billion in 2016 and is expected to grow in 2021 to $33 billion, according to a study by Coresight Research. The managing director at Coreshight noted that companies such as The RealReal could pose a threat to its competitors.