Walking through an African marketplace, visitors might spot t-shirts with bold Chinese characters forming phrases like “Order takeout, use Ele.me” or “Crossing Shenzhen.” These printed clothes, now common across the continent, are secondhand garments from China.
Every year, millions of tons of used clothing flood Africa’s markets, supporting a massive industry. In 2023, global sales of secondhand clothing reached USD 211 billion, a 19% increase from the previous year. By 2024, Africa’s clothing market had expanded to USD 70.58 billion, growing at an annual rate of 5.16%. Among the players capitalizing on this trend are Chinese entrepreneurs.
Back in 2010, Guo Song, then a college student, discovered a side hustle. Collecting discarded military training uniforms from classmates, he packaged and resold them to other training bases. Inspired by this small success, Guo saw the potential in secondhand clothing on a broader scale.
In 2016, Guo launched Gracer in Guangzhou, building a data-driven logistics system to gather, sort, and package unused textiles for export. His markets now span Cameroon, Kenya, and Congo in Africa, as well as Thailand and Cambodia in Southeast Asia.
Today, Gracer processes tens of thousands of tons of used clothing annually, with Africa as its primary market. Over 60% of Gracer’s exports go to the continent, and in the previous year alone, the company’s sales of secondhand clothing reached RMB 400 million (USD 56 million).
A robust market in Africa
“In Africa, buying secondhand clothes is competitive,” Guo told 36Kr.
Africa, home to one-sixth of the world’s population, is now the largest importer of secondhand clothing globally. Nairobi, Kenya’s capital, hosts East Africa’s largest secondhand market, where thousands of items flow daily, forming a vital link in Africa’s used clothing network.
In 2021, China became Africa’s largest secondhand clothing supplier, with Kenya as its main importer, sourcing over 40% of these items from China. According to the China National Garment Association, secondhand clothing imports to Africa totaled USD 1.84 billion that year, with USD 624 million coming from China.
For many in Africa, new clothes remain a luxury. With limited resources, only 10% of consumers can afford new clothing, while 50% rely on secondhand options. The remaining 40% depend on charitable donations for basic attire.
Compared to secondhand options from Europe, the US, Japan, and South Korea, Chinese clothing is often more affordable and stylish, meeting the continent’s growing clothing needs practically and popularly.
Before reaching markets abroad, these garments are sourced from dumpsters, neighborhood collection bins, and donation sites across China. Collection companies sanitize, sort, and package the clothes before selling them to exporters. Once categorized by quality, type, and seasonality, the items are compressed into blocks and shipped to Africa, where local agents distribute them to markets.
“Agents inspect clothing through the compressed packaging, checking for freshness, color, and style. They are cautious because their funds only cover one package at a time. If they choose poorly, their families—often with several children—might go without food for days,” Guo said.
Secondhand clothing isn’t just a commodity—it’s an economic backbone. In Kenya, a country of 54 million, millions rely on the secondhand clothing sector for income, accounting for nearly 10% of the workforce.
“Countries like Uganda, Kenya, and Tanzania have considered banning secondhand imports to protect local textile industries. But these clothes fulfill basic needs and create jobs that sustain communities. Until economies improve, secondhand clothing will remain essential, and policies alone can’t eliminate demand. New clothing from domestic industries is often too expensive, primarily made for export revenue. Only with rising incomes and improved access to essentials like food, healthcare, and education will people afford new clothes,” Guo explained.
Goods flow easily, people don’t
Doing business in Africa is complex. Setting up shop doesn’t guarantee success.
During Gracer’s early expansion, Guo and his team debated whether to establish an in-country team in Africa.
“Our business was growing fast, so why not set up local branches to cut costs, like other companies?” Ultimately, Guo aligned with this direction to support Gracer’s long-term goals.
In choosing Uganda for its first foreign site, Gracer hoped for stability and favorable customs policies.
“Customs regulations change frequently. Beyond high costs, they often create barriers. In Zambia, for instance, clearing used clothes can take up to two months, and afterward, goods might ‘disappear’ with explanations like ‘washed away by rain’ or ‘stolen en route.’ We’re left with no recourse and must absorb the loss,” Guo said.
To break into the market, Guo’s team prepared to “sacrifice a container or two” to absorb risks. Gracer also encouraged clients to join a customs whitelist to limit losses. “We advise clients to pay taxes fully, avoid evasion, and cooperate during inspections. This approach minimizes entry issues, even without facilitation fees.”
With these adjustments, Gracer established its Ugandan base.
“At first, we managed our sales directly and fostered positive relationships with local distributors to avoid conflicts,” Guo said. However, local distributors initially feared Gracer would “take their jobs” and cut ties with the company. After clarification, Gracer’s entry into Uganda encountered fewer obstacles.
Within six months, Gracer’s Ugandan operation scaled up to USD 10 million in monthly sales, reaching an annual gross profit of 20%.
Yet, by its third year, Gracer shuttered the Uganda branch and returned to China.
Reflecting on the experience, Guo concluded that, while goods flow easily, people do not.
Gracer’s overseas teams encountered management and operational challenges. “Pricing was hard to standardize, inventory checks relied on manual counts, and in many African countries, banks lack foreign currency reserves, requiring market purchases of dollars. This informal exchange complicates currency buying and transfers, making each step a challenge,” Guo recalled.
Beyond logistical issues, employees faced isolation, with some frequenting casinos for entertainment.
The local regulatory environment also presented challenges. Setting up official operations was difficult, leading to reliance on informal methods. “We considered hiring locals, but finding skilled, educated personnel was challenging,” Guo said.
After closing the Uganda branch, Gracer shifted focus to refining domestic sourcing. “If the people issue can’t be resolved, we’ll focus on refining the product,” Guo explained.
Guo acknowledged that the market had matured, with the biggest challenge now being volume rather than finding buyers.
This shift requires refining the supply chain, enhancing processing standards, and moving away from traditional practices.
Through years of development, Gracer has built a recycling process. Its network includes frontend collectors like Oouyan, midstream processors such as Puyi International, exporter Dodo, domestic supplier Geryon, and recycling firm Pulian, with collection points in 245 cities. Processing over 200 varieties, Gracer can complete orders in 10–20 days from collection to export.
Despite past setbacks, Guo hasn’t ruled out re-establishing a physical presence in Africa. “Once our digital infrastructure is fully developed at home, we may consider another overseas venture.”
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Lin Qingqing for 36Kr.