Secondhand Luxury Product Sales Booming in China

Sales of luxury goods continue to rise in China and now even secondhand luxury products are gaining in popularity in big cities like Shanghai and Beijing. A number of outlets 2 specialized 3 in selling secondhand luxury brands are capitalizing upon this golden opportunity in China.

Let's find out more with our reporter Liu Min.

 

The demand for secondhand luxury products is booming in China. Manager Liu Lian from the Milan Station Shop, a secondhand luxury product outlet 1 based in Shanghai says that they have plenty of loyal customers visiting the store everyday.

"Years ago, our business was just ok, but starting from 2008, the annual trading volume has increased by 15 to 20 percent on average every year."

In 2010, the overall business income of Milan Station Chains reached 730 million Hong Kong Dollars and the net profit made on the Chinese mainland exceeded 32 percent.

Such promising 4 business has lured 5 some international chains to open stores in China. Japan's Brand Off, the biggest outlet chain specializing in selling secondhand luxury products is one of them. This September, the company opened its first franchise 6 store in Shanghai. The store manager Takayuki Shimata says the company finally decided 7 to explore the Chinese mainland market after a series of research.

"First, we invested in establishing six chain stores in Hong Kong, which turned out to be a great success. Since we already had franchise stores in Japan, Hong Kong and Taiwan, we started to think about where we should continue with our business expansion. We've decided that Shanghai is the best choice."

In order to maintain the store's reputation, the managers have to maintain a keen eye when buying secondhand products since no one want to take the risk of purchasing fake goods which would lead to huge loss. A consistent appraisal 8 system with high level of appraisers is critical to the entire business.

Currently, 200 million people in China are considered as the existing and potential consumers of luxury products. But the huge market is short of talented individuals specialized in luxury business management or capable of high level appraisal, especially when it comes to secondhand products. Now a common appraiser 9 can make an annual income of at least 150 thousand yuan in Shanghai.

In recent years, majors in luxury product appraisal have gained popularity in both domestic and overseas universities.

Currently, the People's University of China and Shanghai University offer bachelor and master degree courses on luxury product appraisal.

An anonymous 10 student says that even though the tuition fee is very high, many students are still willing to take the courses in order to pursue such a career.

"We spend the first year studying at the campus of Shanghai University, and then we we'll go to the campus in Paris to continue the program. We'd spend one year learning the local language, and then the second year we will take classes related to the major. The overall expense is nine to ten thousand Euros per year."

But professor Xia Zhengwei, specialized in Luxury Brand Management, says such teaching program in China is far from mature.

"We have to consider introducing more professional teachers in this field. Plus, we need to work more on how to combine the study program with the real market demand."

Market insiders have also indicated that the industry also requires an independent third party which would process the professional appraisals 11 in order to provide a more convincing and secure trading environment for luxury products, which would benefit both consumers and the secondhand retailers 12.

For CRI, I'm Liu Min.