In recent times, there has been a noticeable uptick in secondhand shopping, including for luxury brands, reflecting evolving attitudes towards consumption in China.
Customers, like one interviewed at a used-goods store in Guangzhou, cited cost-effectiveness as a primary motivator for exploring secondhand options, with designer items such as Louis Vuitton and Burberry bags often available at significant discounts, sometimes up to 80% off.
This trend towards secondhand luxury goods aligns with a broader shift towards value-conscious shopping habits, particularly evident among Gen Z consumers grappling with economic uncertainties.
Zhao Weilin, a senior researcher at Japan’s Itochu Research Institute, noted a growing wariness among China’s middle class towards extravagant spending.
According to projections by the Institute of Energy, Environment and Economy at Tsinghua University, the market for used goods in China is on a rapid ascent, potentially doubling from its 2022 level to reach 3 trillion yuan ($414 billion) by 2025.
However, despite this surge in secondhand shopping, luxury brand sales in China have faced challenges. LVMH, for instance, reported a 6% decline in sales for the January-March quarter in the China-dominated Asian market, the only region where a decrease was noted. Similarly, Kering experienced a 19% drop in retail sales in the Asia-Pacific region excluding Japan during the same period.
Although the mainland Chinese luxury goods market saw growth, reaching 444.7 billion yuan in 2023 according to Bain & Co., this figure fell short of the 2021 peak amidst evolving consumption patterns and economic conditions.
Weiwei Xing, a partner at Bain, highlighted the increasing hurdles to brand consumption in China.
While Chinese consumers are increasingly purchasing secondhand luxury goods both online and in physical stores, some analysts suggest that sales in China still lag behind Western countries, indicating potential for further growth in this segment.
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