In December 2015, Poshmark decided to launch a new feature: the wholesale portal. Since then, it has experienced mixed results. Sarah and I have had our own experiences on the matter (“I” being Sarah’s significant other), ranging from “not very useful” to “this is harming retail on Poshmark.” As a retailer on Poshmark, we have noticed a few trends:
- The prices on the wholesale portal are ridiculous.
- A lot of retail closets we’ve seen have a “strange” amount of identical items.
- This has led to a lot of retailers slashing their prices.
While we have other supplier sources, the success of the greater Posh retail ecosystem means greater success for us. Its a classic case of clustering. If the retail environment is good on Poshmark, more people will shop retail on Poshmark, and retailers benefit from it. So we wanted to take the opportunity to examine the wholesale portal.
Poshmark has several reasons for creating a wholesale portal. According to this article on Fortune.com, the company sees this as a shrewd business move. They estimate that 10-20% of the items sold on Poshmark were originally purchased through wholesale. They, eventually, take a percentage from the wholesale purchase, then another from the retail purchase.
Poshmark also views this as an opportunity for users according to Fashionista.
…the company sees the wholesale portal as a way for [the users] to grow their personal boutiques beyond the items in their closets. “To [the users], it’s not just about selling or transacting,” Tracy Sun, Poshmark’s co-founder and VP of merchandising, tells Fashionista. “It’s all about being creative and being able to express themselves. They want to connect with their peers digitally, and they know how to do it. As we’ve watched them grow, we wanted to extend our platform for them.”
Retailers getting access to wholesalers seems like an obvious boon. Being able express themselves and strengthening the Posh community also seems to be a great idea. So what do you need to be able to purchase wholesale? The requirements are pretty simple:
Who is qualified to access the Wholesale Portal?
Sellers with 10 or more sales, 4.5+ average rating, and completed retail certification are qualified to access the Wholesale Portal.
How does buying work?
Purchase inventory within the Wholesale Portal just like you would a normal listing on Poshmark. Press that big, blue “Buy Now” button!
Poshmark does not publicly state how one gets on the wholesale portal, but from our own efforts with our Bare Anthology brand, we think it comes down to having items personally designed for wholesale and the ability to move a large quantity of items. Take this with a grain of salt though. From talking with other Poshers, it seems to be more of a case by case basis where those requirements can be bent or waived entirely.
What do Poshers think of the portal?
Without our own experiences in mind and an understanding of Poshmark’s goals and requirements, we wanted to touch base with the Posh community to see what they thought. 348 people participated in this survey so thank you ladies, it really helped us! Now here are the results:
(If you feel the tone of the writing in this post changed a little, it probably has. It’s back to me writing. Can’t get the BF to do everything aye?)
- RED – hate for portal
- GREEN – love for portal
- BLACK – neutral
- ORANGE – mix of love/hate
1. Right now, how do you feel about the portal?
The results for this survey question were a little surprising to me. Most of the time, people tend to not take very extreme views when it comes to answering a survey. I expected “dislike” for the portal to follow the same bar chart pattern as “like” for the portal but a significant number of people actually responded with “Hate it so much and wish Poshmark would shut it down”. There were a total of 223 “hate” responses vs 58 “love” responses.
2. Have you ever bought from the wholesale portal?
3. If you’ve never bought from the portal, why not?
No surprise here. Many Poshers can find portal items elsewhere for cheaper. It is called Google reverse image search and REAL wholesalers.
Some replies in the “other” section include
- There are far better wholesale retailers on other websites + shady business practices from the retailers in the Wholesale Portal (such as charging more than it costs on the retailer’s website.)
- There’s too many selling the same thing and it’s not moving in my closet
- The portal is completely unfair to those who have obtained legal sales and use licenses to do business with wholesalers, not to mention, the prices are marked up and the general public is none the wiser. Unethical on Poshmark’s side
- The items can be found elsewhere online cheaper. Plus, Poshmark is completely saturated with the same items being sold in the portal, that only the rock bottom prices sell, therefore the investment isn’t worth it. Many are just trying to get rid of merchandise purchased even if they loose money. Which is what is unfortunately happening.
- Oversaturation of the market with poor quality overpriced merchandise
- It’s too expensive; I don’t like the brands and HATE that PM values them more than the users who built PM
4. Do you think Portal stores reselling wholesale bought from already established vendors deserve to be featured or should they only be independent designers?
Poshmark also needs to weed out portal sellers that are not designing their own items. In all my emails with PMHQ, they *insist* only designers are allowed but then still allow portal sellers (who do not design their own items) like Fashionomics and April Spirit to operate.
Some comments in the “other”
- They should NOT be allowed to sell at all. They are not independent designers. They are not wholesale sellers. They are just buying & re-selling for 2 to 3 times what they paid, April’s spirit, some of 3 birds nest & many more of them, if not 99% of them. But I don’t think the portal should be there anymore anyway. Nor should anyone buy from it that doesn’t have a tax ID # & DBA certificate.
- Poshmark needs to separate its wholesale division. It was originally a place to shop each others’ closets. It should stay that way. Create a separate retail Poshmark site and return Poshmark to its origins.
- Only if Poshmark broadens all of their featured brands. They shouldn’t only promote Portal brands, like “Tea & Cup” in parties. That seems like a form of nepotism. They should have bimonthly parties that feature brands such as Wildfox or “Vintage” (which isn’t a brand, but is what most vintage sellers use as a brand) equally featured on the app
- Not sure what I think about this
- I’ve seen items in the wholesale portal that are easily obtainable for less on eBay. Buying from these sellers is just silly. I don’t know what they deserve, but I won’t buy from them.
- I wasn’t sure I understood this question. Are some of the “wholesalers” in the Portal actually reselling inventory they purchased from a larger wholesaler? If so I didn’t realize that was the case. I would consider these sellers to be retailers in that case.
- I think if Posh is going to have a wholesale portal then use wholesale distributors not people who have stores and have purchased from a distributor prior to reselling.
5. Which are your favorite portal sellers? Does not matter if you have ever bought from them. (this is not an exhaustive list. if you have a favorite not listed, please add in “other”)
April Spirit & Function and Fringe seem to the favorite choices.
In the “other” section, many Poshers chose to answer “none”.
6. Which are your LEAST favorite portal sellers? Does not matter if you have ever bought from them. (this is not an exhaustive list. if you have a LEAST favorite not listed, please add in “other”)
EDIT: I apologize for my previous chart, I had duplicated the data in the previous survey question.
Most Poshers have chosen the “I hate them all” option. This number differs from the previous question because I am taking data from 348 instead of 312 responses (I made all the charts when it got to 312 responses). Looks like the least favorites are T&J Designs, WILA and Classic Woman PM.
In the “other” section, the most common comments are:
- Three Bird’s Nest
- I don’t dislike any
- i dont hate them but i think they lack good customer service its half united …even thou i love theyre items and what they stand for i dont like being ignored when i ask a question.that is what happened with half united, they should reply to customers promptly due to the fact that these are potential buyers.
7. On a scale of 1-10, how much do you TRUST portal sellers?
Trust levels average to 4.3/10.
8. For resale/consignment closets, how do you think the Portal has affected your sales?
9. For retail closets, how do you think the Portal has affected your sales?
10. For closets selling your own items, how do you think the Portal has affected your sales?
For questions 8, 9 & 10, a large majority of people feel that the portal has affected their sales negatively and only a small minority feel their sales have improved since the portal release.
In the “other” section, Poshers mostly commented that they were unsure how the portal affected their sales.
11. Do you think portal sellers should be promoted as heavily as they are right now?
This is pretty self explanatory. A large majority feel that portal brands are being promoted too much.
12. Do you agree with the current requirements (10 sales + 4.5 rating) to shop the portal?
Most Poshers feel that requirements should be more stringent, mainly because wholesale prices should not be accessible by buyers/customers.
In the “other” section, comments include
- You should have an actually business license to shop the portal! This is not fair to REAL wholesale buyers/retail businesses.
- Ridiculous you should be able to buy what you like.
- Not only should requirements be more stringent if you have to keep the portal but only REAL BUSINESSES WITH TAX ID #’s & proper papers should be allowed to even view the portal and only REAL WHOLESALE VENDORS SHOULD BE ALLOWED TO SELL IN IT.. But again I think it should be done away with anyway. It’s not cool to the women w/real businesses and the portal isn’t real wholesale anyway.
- No requirement benchmark! Can see all prices on Internet anytime, any wholesaler
- No anyone should be able to become a retail closet
13. For those ladies who have bought from the portal…
a. If you have bought from the portal before, what led you to purchase?
Most people felt that Poshmark was pushing the portal hard (the more you see an ad, the more likely you will be to act on it. A large majority also did not have their seller’s permit and so the portal provided easy access to wholesale.
In the “other” section, some comments include
- i purchased to try to be supportive of Poshmark’s new feature (the portal) but quickly learned how bad it was and the complete and utter negative impact it’s had on Poshmark and all the sellers, real businesses that have posh closets that is 😦
- The ease and inventory arrives/is shipped quickly
- My sales dropped completely as soon as this was released. So I figure I would try to sell retail but now I haven’t even sold any of those items either! No Sales since May!
- It was an exciting new feature and I couldn’t wait to use it…because of the ease of purchasing wholesale with my earnings from poshmark
- I was trying to get featured as a Boutique.
- I was curious to see if it was a good option for me
b. Were you satisfied with the quality of the items you received?
Most feel pretty neutral about the quality of items they have received. Others feel some brands have better quality than others.
c. Have you been able to sell your inventory bought from the portal?
A large majority of Poshers were unable to sell their portal inventory. I should have had a follow up question as to why they think this was happening, but that slipped my mind. If you think there is a reason why your inventory is not selling, let me know in the comments section.
In the “other” section, some comments include
- nope but i doubt it since it’s not popular and it will never will! i would rather buy well known pieces like Gucci, Dolce & Gabbana, Lanvin, etc. rather than those ugly shit
- Yes, some at good profit, some at small profit. People do not want to pay near at all to full retail price. They expect a bargain, even at the seller’s expense.
- Personal use, had no intention to resell
- Only have one item that’s retail, and I haven’t sold any of them yet. I’m waiting a while before I make a judgement.
d. What is the average profit you’ve made per portal piece sold?
Most portal items are being sold at $1-$10 profit, which by the way is pretty low. Most retailers use keystone markup, which is 2x of the cost price. Most portal clothing items are sold between $10-$20 (especially from April Spirit, Fashionomics) and earning $1-$10 a piece is not even using keystone pricing. Understand that you need to cover the time you spend photographing, listing and sharing too. Are you saying your time is worth $10?
In the “other” section, some common comments include:
- haven’t sold it yet
- ZERO. Not 1 piece has sold.
- Thus far I’m in the negative as only 1 item out of the few “packs” I purchased have sold so I’m about $800/$900 or more in the negative
Actually, the most common comment is $0.
e. How many purchases have you made from the portal?
f. Do you regret purchasing from the portal?
Majority regret purchasing from the portal but many are still undecided on this.
14. Rate the portal selection
Average rating 3.23/10 for portal selection
15. Rate the portal prices
Average rating 2.33/10 for portal prices
16. How much do YOU think Poshmark cares about YOUR OPINION on the portal?
Ok Poshmark, time to up your game and listen to your largest supporters because we are definitely not feeling the Posh Love.
The results seem to indicate a very negative opinion of the wholesale portal.
Only 32% of responses say they like it or are neutral on it. Granted, most said they had never purchased anything from it. Of those that have (130), 56% say they will not purchase from it again. Those who have not purchased from the wholesale portal should not be discounted though. 70% of those who do not choose not to do so because they know where to find a better price, because its too expensive, or have wholesalers already. 104 out of 186 (56%) retailers reported that their sales have dropped. That is pretty high! Especially compared to the 25% who report no change, 9% who report changed unrelated to the portal, and the 9%, and 10% who report an increase in sales.
So it seems to generally be not so useful, or damaging. Largely matching our own experiences. A big surprise was how people felt about the wholesale portal. The average rating on the selection was a 3.3 out of 10. The average rating for the prices was a 2.4 out of 10. Poshers also feel it is being promoted too heavily and don’t even trust portal sellers.
Given that Poshmark wanted to help retailers, encourage expression, and make some money, the results are bad. It hurts retailers, hurts the individuality of retail closets, and those two together seem like a bad way to make money.
Note: Some of the figures listed in the “thoughts” paragraph differ from those above. Charts were made before writing this and actually had more responses in the time between.
— The Posher and her Survivor