FB Pixel no scriptChina's shoppers still want luxury, but they are okay with secondhand goods | KrASIA

China’s shoppers still want luxury, but they are okay with secondhand goods

Written by Nikkei Asia Published on   2 mins read

LVMH and other groups see sales slip in the region as consumers turn thrifty.

China has seen a surge in secondhand shopping, including for luxury brands, in a sign of changing attitudes toward conspicuous consumption.

“Buying new is expensive, so I came to look at secondhand items,” a customer at a used-goods store in the southern city of Guangzhou said in late April.

Inside the shop, some designer bags from brands like Louis Vuitton and Burberry were on sale for as much as 80% off.

The rising popularity of secondhand luxury goods is an extension of a growing emphasis on value in daily shopping habits—notably among Gen Z consumers, who face an uncertain job market.

“China’s middle class, which drives volume in the country’s consumption, is now afraid of spending,” said Zhao Weilin, a senior researcher at Japan’s Itochu Research Institute.

The market for used goods in China is growing fast and could reach RMB 3 trillion (USD 414 billion) in 2025, double the 2022 level, according to the Institute of Energy, Environment and Economy at Tsinghua University in Beijing and other sources.

Luxury brand sales in China have been sluggish overall.

France’s LVMH, the world’s largest luxury group, saw sales for the January-March quarter fall 6% on the year in the China-dominated market of Asia excluding Japan. This was the only region for which the company reported a top-line decline.

France-based Kering, which owns Gucci, also struggled during the period, with retail sales in the Asia Pacific region excluding Japan falling 19%.

The mainland China luxury goods market was worth RMB 444.7 billion (USD 61.3 billion) in 2023, up 12% from 2022, when the country was still feeling the effects of zero-Covid-19 lockdowns, according to Bain & Company. But the figure fell short of the record RMB 456.4 billion (USD 62.9 billion) in 2021.

“The hurdles to brand consumption in China are getting higher,” said Weiwei Xing, a partner at Bain.

Chinese shoppers buy secondhand luxury goods both online and in physical stores. Japanese retailer Komehyo Holdings has opened a store in Shanghai that uses artificial intelligence and expert staff to check for counterfeits among the stock of used items.

Some market watchers say secondhand luxury goods sales remain low in China compared with Western countries and still have room to grow.

This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.


Auto loading next article...