Legal Definitions - Resale

Resale refers to the act of selling an item or property that one has previously purchased. Essentially, it's a transaction where a current owner sells something they acquired from a prior owner. This often occurs with the intention of making a profit, but it can also happen when an owner simply wishes to dispose of an item they no longer need or want.

• Example 1: Selling a Used Car

  Imagine Maria bought a new car five years ago. Now, she wants to upgrade to a newer model, so she decides to sell her current car to another individual through an online marketplace or a private sale.

  This is a resale because Maria is selling property (the car) that she had previously purchased and owned. She is not the original manufacturer or a new car dealership; she is selling an item from her personal possession to a new owner.

• Example 2: A Vintage Clothing Boutique

  "Retro Threads" is a boutique that specializes in selling pre-owned designer clothing and accessories. They acquire these items from individuals who originally purchased them from high-end retailers or directly from designers. Retro Threads then sells these items to new customers, often at a lower price than new, but still aiming for a profit margin.

  Each transaction where "Retro Threads" sells a piece of clothing or an accessory is a resale. The boutique is selling goods that it previously purchased (or acquired on consignment, which for this purpose functions similarly) from the initial buyers, rather than selling brand-new items directly from the designer or manufacturer.

• Example 3: Trading Shares on the Stock Market

  Michael bought shares of Company Z stock several months ago, hoping their value would increase. After the stock price rose significantly due to positive company news, he decided to sell his shares on the stock exchange to realize his gains.

  When Michael sells his shares of Company Z, it constitutes a resale. He is selling a financial asset (the stock) that he had previously purchased from another investor (or the initial public offering market), not creating new shares. The profit he makes from selling at a higher price than he bought it is a common motivation for such resales in investment contexts.