No items found.

How Does Poshmark Make Money?

Poshmark has emerged as one of the leading online fashion marketplaces for individuals seeking to buy or sell luxurious and high-end clothing, accessories, and more. Still, many people ask - how does Poshmark make money? For a clear breakdown of Poshmark's revenue, you've arrived at the right place. By understanding how this app, which is similar to social media platforms, generates revenue, plan strategies for improving your e-commerce business faster.

A couple holding a package and smiling
So, how does Poshmark make their money?

What Is Poshmark and How Does it Work?

First of all, let's start with the basics. Poshmark is a multi-vendor marketplace platform where resellers can post listings of different vintage items for customers to browse and ultimately purchase. 

It is available as an app on Android and iOS, and there is a website. It was created in 2011, and since then, Poshmark has grown to be one of the best online-selling platforms with 80 million users. 

The responsibility of making listings and generating sales is on the sellers, while the app is only a mediator between the customer and the seller. By all accounts, this is one of the platforms that can be a springboard for starting a lucrative e-commerce business. It has some features of a social media app, like likes and followers.

Check out the following video for more information on how this app works.

What Can Poshers Sell and Make Money On?

Users have an opportunity to sell a wide range of goods, primarily fashionable and stylish items, and make money in the process. After a buyer orders an item, the shipping label ensues, which is very simple with Posh shipping labels. 

Here is a list of the most sought-after products sellers can profit from:

  • Clothing - Clothing resellers can offer vintage pieces from designer brands,
  • Shoes - Within a shoe and sneaker business, users can offer stylish heels, quirky boots and gently worn sneakers,
  • Jewelry - Fine pieces, as well as handmade jewelry,
  • Home decor - Decorative pieces and wall art,
  • Beauty products - Skincare, haircare products and unopened makeup 

How Does Poshmark Make Money?

Before starting an online store, it's important to understand that Poshmark functions primarily on the commission-based model. However, there are three distinct streams that are used to generate revenue for the online marketplace platform, and these are:

  • Peer-to-peer sales,
  • The boutique service,
  • Wholesale offers.

How Does the Poshmark Business Model Work - Peer-to-Peer Sales

Poshmark's commission-based business model is very simple. The app or site will help the sellers promote their listings, process the payments, and authenticate the luxury items. In turn, the platform charges selling fees for different types of sales. For anything that gets sold for less than $15, a charge of $2.95 applies. 

On the other hand, an item that is sold for more than $15 incurs a fee of 20%, which is deducted from the final sale price. The majority of revenue comes from fees obtained from peer-to-peer sales. According to Zippia, the platform's highest revenue, $262 million, was recorded in 2022.

Boutique Service

The boutique Poshers are sellers that are seen as small brick-and-mortar shops. If you are a boutique seller, the platform will indicate that the items in the store are new, of high quality, and unique. There are a couple of guidelines the sellers owning this kind of business need to follow, such as using high-quality photos and providing information about where the goods were sourced. Obtaining a certification for being allowed to carry out boutique service comes with a charge of $20.

Two women sitting at a table
Are you interested in creating an e-commerce business? Use the boutique service.

Poshmark Wholesale

Since 2015, the app introduced something new - Poshmark Wholesale. This is a new niche within the platform where the resellers are able to purchase larger quantities of items they'd like to offer to their buyers. 

The benefit of wholesale lies in the price discounts. The only way to gain access to wholesale is to have a high rating on at least ten sales, primarily a 4.5 rating and higher, as well as to obtain certification for boutique services. A percentage of the sale price will be taken by Poshmark.

A woman carrying a box next to a woman taking notes
Participating in Posh wholesales is possible only if you are a top reseller

How Much Money Does Poshmark Make From Advertising?

Poshmark's business model does not specify that revenue is generated from advertising. The only streams that are known are the three mentioned above. However, the company may introduce new revenue streams and advertising initiatives in the future. Nothing has been announced, but the sellers will be informed, and it will be adapted for the sellers' requirements.

Woman posing for a photo while holding a shoe
As a Poshmark user, you can turn pre-loved fashion into cash!

Our Expert Tips to Sell Fast on Poshmark

Looking to sell fashion items quickly? Our expert tips can help any business reach new heights. Here is a list of tips to boost success on the app:

  • Use stunning photography of your item - Capture well-lit photos of the products from multiple angles.
  • Set appropriate sale price - Take time to research similar listings and understand how your competitors try to attract buyers.
  • Share listings on social media outlets - Utilize Pinterest, Instagram, and Facebook to gain the attention of customers through social media.
  • Be receptive to buyers' inquiries - Be patient and kind to buyers who reach out with doubts and concerns.
  • Use informative descriptions - The more details, the better, since they need to obtain a proper picture of the item from your perspective.
  • Use Poshmark Authenticate - If a luxury item is being sold, having Poshmark's stamp will make individuals trust you.
  • Attend Posh parties - Increasing the visibility of products is possible through themed parties.
  • Use cross-listing software - Online selling tools can help with visibility and gaining a reputation in the online selling world.

Have a Selling Software Help With Business Growth - Invest in Zipsale

If you are looking for the perfect crossposting tool, you've found it - Zipsale. With this useful and easy-to-use multichannel listing software, increasing sales will be effortless. It is designed to allow sellers to post on multiple platforms at the same time. These platforms include Depop, eBay, Etsy, Vinted, Shopify, Poshmark, and Facebook Marketplace. The perk of the crossposting software is having an auto-delist feature as well as one inventory. Posting, deleting, and changing listings will be much faster, so brace yourself for an increase in followers. Learn all about the crossposting app on our website and enjoy incredible perks by registering right now! 

No items found.

Related articles