“The trend has been driven largely by the economic squeeze of the pandemic, with more people looking to sell their luxury goods for cash and luxury shoppers tightening their belts. Moreover, travel restrictions prevented Chinese luxury shoppers from going overseas to bypass the significant price gap for luxury goods between China and other markets like Europe,” explains Jacob Cooke, co-founder and CEO of WPIC Marketing + Technologies.
Consumer trust is a pain point for China’s resale market. The proliferation of counterfeits is creating barriers to growth. “Authenticity continues to be the primary concern for buyers,” says Cooke. Data shows that in 2019, only 33.6 percent of luxury products in China verified by luxury goods appraisal were genuine.
“Community stores have an advantage in building trust between the buyer and seller,” concludes Cooke.