This N.J. company collects nearly 100,000 pounds of clothing every day to help stock thrift stores and resellers

Not far from the Shore, a steady stream of trucks hauls in thousands of pounds of donated clothing a day to a warehouse in Eatontown, N.J. There, it is weighed, sorted, and categorized so it can be sold in bulk to a coterie of 6,000 wholesalers, thrift stores, and small resellers who will sell everything from Aritzia dresses to Abercrombie & Fitch jeans to Outdoor Voices yoga pants.

The warehouse in Monmouth County is owned by Helpsy, a company that collects 96,000 pounds of clothes daily from the thousands of metal bins that dot the parking lots of malls, churches, and schools. The cargo, items that people have discarded from their closets, is retrieved from 11 states on the East Coast.

Helpsy gets most of its sales inventory from consumer donations, but it also buys unsold inventory from large thrift stores. The change of seasons is the busiest time for the company. It’s when consumers, with bags of clothes fresh from the closet purge, will toss their once-loved merchandise into a bin ushering it into its new life. The same thrifts that sell clothing to Helpsy will often buy stock they know will sell in their stores.

Once the clothing arrives at the warehouse, three dozen sorters will use digital scanners to help classify 20,000 items a day, by brand and category (athleisure to prom dresses), to determine where the item will go to extend its life and keep it out of landfills.

Helpsy, a for-profit, privately held company, made $26 million in revenue in 2022 from donated clothes and new wholesale clothing it buys from brands and retailers who have to off-load their overstock, e-commerce returns. Some brands also sell them their styles that may not pass the quality control test like the thousands of July Fourth swim trunks from Chubbies in a shade of red that the company decided not to sell.

Once it’s cataloged, all of the clothing collected by Helpsy is resold at stores like Plato’s Closet, Uptown Cheapskate, and Beacon’s Closet. Helpsy also resells to smaller vintage stores (over a dozen in our area, including the non-profit The Wardrobe), and small resellers who then peddle their merchandise on peer-to-peer selling marketplaces like Poshmark, Depop, and Mercari.

Helpsy can swap merchandise or fill shelves with brands that are known sellers for their clients. Best-selling brands are Adidas, Nike, Everlane, the North Face, Zara, and Madewell. It sends its higher-end merchandise to luxury resale company the RealReal on consignment.

“We supply online individual resellers with brands to scale up their businesses and thrift stores with brands they can sell,” said Dan Green, cofounder and CEO of Helpsy. “For thrift stores, they either have too much inventory or not the right kind.”

The recommerce market, in which retailers resell previously owned products through physical and online channels, is outpacing regular retail. Over the last five years, recommerce revenues have grown more than 20 times faster than overall apparel revenues, according to a study by consulting firm Deloitte. One reason: people are buying more clothes than ever and wearing each item less.

Recommerce sales in the United States reached $38.6 billion in 2022, according to GlobalData, and could climb to $43.5 billion in 2023. While wearing secondhand clothing has become very popular with environmentally minded Gen Z and millennial shoppers, the volume of fast fashion produced annually keeps Helpsy’s bins overflowing.

Helpsy is one of about 100 larger collectors in the U.S. The big players include nonprofits like Goodwill and Salvation Army, and for-profits like Value Village, said Steve Rees, president of the Secondary Materials and Recycled Textiles Association (SMART). Helpsy is the only clothing collector in the country that is a B corporation, which means it is assessed for social and environmental performance and reaudited every three years.

According to SMART, textile recyclers reuse and recycle 5 billion pounds of textiles globally each year (this figure includes bed linens and towels). Textiles are the fastest-growing waste stream in landfills. On average, each consumer throws away more than 100 pounds of textiles a year (up from 44 pounds a year in 1999), and 84% ends up in landfills or is incinerated. There, it decomposes and releases greenhouse gasses or leaches dyes and other harmful chemicals into the ground and local water supplies.

Last year, Helpsy kept 35 million pounds out of landfills. It said 95% of what is collected is salvageable; 75% is sold as clothing and used again, while 25% becomes furniture insulation or wiping cloths.

“Reusing it is the best ecological way to extend the life of a piece of clothing,” said Helpsy COO David Milliner. “The more times clothing can be reused, the less virgin material that will be used, and that saves water and other resources.”

In 2021, Helpsy brought the sorting function in-house, and their IT team built proprietary technology to make the process more data-centric. The next year, Helpsy sorted and graded 5 million pieces of clothing and shoes in a more detailed process that allows the company to share with wholesale buyers how much of a particular brand or item is available.

For most of the recommerce industry, the sorting process “is still not fully automated,” Rees said. “Maybe AI down the road will help, but for now, every piece is touched and requires a human to sort.”

At Helpsy, a sorter enters the brand name into a tablet and then reviews the item for its condition, entering that into the system. A barcode for each item is created assigning it a value and that information gets entered into the database and includes the material composition for each piece, valuable information for recycling. The system recognizes 10,000 brands and counting. “Then we can provide that data back to brands and our customers,” said Jessica Rennard, chief merchandising officer. Helpsy also shares the numbers with brands who track their environmental impact, as well as to municipalities that report local sustainability efforts to state and federal agencies.

Founders Milliner, Dan Green, and Alex Husted, childhood friends from suburban Philadelphia, started Helpsy seven years ago. They bought three clothing collection businesses in New Jersey, New York, and Massachusetts and then added six more to their portfolio. They now have 140 full-time employees, all of whom are offered stock options in the company.

Husted, chief information officer, said they were looking for a business that could make a social and environmental impact while also being profitable.

“We stumbled upon this clothing-collection business in New Jersey and it served the community and the environment and had unlimited room for growth,” he said.

The company now sells curated bulk boxes to resellers, which can range from five items to full pallets (which can be close to 600 to 800 units). It promotes these boxes on TikTok, Instagram, and Facebook. Rennard works with 11 mall and athletic wear brand vice presidents and C-suite execs to help with their inventory options by buying merchandise that didn’t sell or was returned. The number of partners is growing.

Inventory gluts are a headache for brands and retailers, but Husted said ecommerce returns are a growing part of the business, accounting for about 10% of their revenue (90% comes from clothing donations and clothing drives).

“When something goes back to the retailer, there is a lot of effort that goes into inspecting it and reshelving it. Consumers buy multiple sizes and send ones that don’t fit back,” he said. “It is hard for them to resell. Returns are now coming directly to us. I can see that business growing.”

Clothing drives also generate substantial inventory for the company. It will do 500 this year with organizations like DARE, AMVETS of NJ, Big Brothers/Sisters, churches, YMCAs, and Girl Scouts as well as municipalities that need solutions for their textile waste to keep it out of landfills. It pays by the pound for that inventory. The company also works with universities and colleges on end-of-year cleanouts. Helpsy collected 40,000 pounds of clothing from Princeton University last year, according to Matt Brinn in the college’s Office of Sustainability.

“For municipalities, clothes are worth more than plastic and glass and create more greenhouse gas emissions,” Green explained. Helpsy was selected to be the city of Boston’s official textile recycler in February of 2020 and would like to expand in other major cities.

The business’s biggest hurdle is apathy — the sheer inconvenience of donating versus throwing clothing in the trash. To make it easier, the company now has curbside collection in Boston, and in Chester, Montgomery, and Bucks Counties locally. It will expand to Delaware County soon.

“It is a behavioral mindset,” Green said.

Husted visits consignment and thrift stores regularly to see what is selling or isn’t. “The eye candy is the Louis Vuitton bag or the Dolce & Gabbana sweater and they make great margins on those kinds of pieces, but Lululemon moves faster and brings in cash faster,” he said, adding that reselling is growing by leaps and bounds.

“We see ourselves as selling the picks and shovels to the gold miners. We provide the tools and materials for resellers to succeed.”