Shoppers buy into pre-owned market
Second-hand trade thrives as consumers feel the pinch
THE era of the conscious shopper, coupled with tough economic times, is proving to be a blessing for second-hand shops such as Rags & Lace in Craighall, Johannesburg.
But it’s not only bricks-andmortar retailers that are selling pre-used items: online platforms have spawned large communities where people can trade in second-hand goods.
At Rags & Lace, women in Porsches and the latest Mercedes-Benz arrive with bags full of clothes they’ve cleared from their closets. They drop them off for store manager Mathilda Montanari to sort through and decide which she’s keeping to sell.
Others arrive empty-handed and emerge hours later clutching bags packed with great finds.
A destination store, Rags & Lace caters for all income brackets. Those who have the means to shop at Hyde Park’s high-end stores just up the road also have the financial smarts to know that getting the same item for much less makes economic sense.
“These are customers who understand that they can get the same Céline skirt that’s R15 000 in Hyde Park for R2 000. It’s still in pristine condition so it’s a financially sound decision,” said Montanari, who has managed Rags & Lace for 22 years.
The most expensive item the store has sold to date is a Chanel bag for R22 000 — but “we have shirts and blouses that cost as little as R20. Not everyone is looking for high-end fashion. This means that anyone can get good-quality clothes at very low prices,” said Montanari.
Rags & Lace sells stock on consignment; the seller gets half of the sale price. There was almost always a surge in customer numbers during tough economic times, said Montanari.
The sale of second-hand items, be they clothes, furniture or household appliances, has penetrated social media, with Facebook and Twitter becoming the new places to sell. Platforms such as OLX, which has more than four million monthly active users, have seen steady growth in second-hand items over the past year.
The platform allows users to trade among themselves in items such as vehicles, electronics, computers, homeware, garden items and tools.
OLX marketing manager Karla Levick said: “We are very pleased with the performance so far.” She said the company had not seen any disruptions with the growth of second-hand trading groups on social media.
On Facebook, trading group Cape Town Second Hand Furniture has 106 046 members, and 82 000 have signed on with Second Hand Johannesburg.
Online retailer Takealot seems unfazed by the growth of the second-hand market.
Chief marketing officer JulieAnne Walsh said Takealot had had double-digit growth last year in year-on-year sales, “meeting our forecast targets across our platforms: online, mobile and our free shopping app”.
Takealot is mum about the average value of sales.
Walsh said social media was a crucial part of Takealot’s daily marketing mix.
“We have an active social community of plus-minus 350 000 fans and followers across all our active platforms — predominantly Facebook, Twitter and Instagram.”
Customers can shop from 21 departments online, featuring products such as TVs, laptops and smartphones in its growing electronics division; kitchen appliances; liquor; books; toys and health and beauty products.
Walsh said there was no sign of Facebook groups having an impact on Takealot’s business. WARM AND FUZZY: Second-hand clothing stores such as Rags & Lace in Craighall, Johannesburg, do a brisk trade
“We focus on negotiating the best prices from our suppliers to make sure that we can offer great deals, with a hassle-free returns process that second-hand goods often don’t have.”
Takealot primarily sells new goods, but it also sells “certified pre-owned” goods, such as cellphones, from leading manufacturers like Apple.
“The other is our Unboxed Deals, which are returned products that are offered for sale at discounted prices.
“Unboxed products could show signs of slight use, minor cosmetic imperfections or be missing the original packaging.
“Where the original packaging is missing or damaged Takealot may reseal or replace this packaging altogether to better protect the item,” said Walsh.
Walsh said Takealot had a strategy of paid and organic content and promotion on its social channels to work together to provide customers who want to use social media to purchase items.
Although second-hand sales give consumers more bang for their buck, they affect local manufacturing negatively.
Second-hand clothing was of- ten sent to developing countries from developed nations to clothe the poor, but “instead it ends up being sold and destroys the importing country’s clothing manufacturing industry”, said Etienne Vlok, research director at the Southern African Clothing and Textile Workers’ Union.
“In many other African countries, second-hand goods, especially clothing and shoes, have streamed into their markets. This decimated local manufacturing sectors and jobs and has undermined efforts to industrialise those countries,” said Vlok.
He said Sactwu’s sister trade union, the National Union of Textile, Garment and Tailoring Workers of Nigeria, had reported that second-hand clothing had had a negative impact on the country’s efforts to grow and industrialise.
Now imported second-hand clothing had begun to enter South Africa, said Vlok.
“While this is very concerning, it is not surprising as our borders have become much more porous recently.
“In the early 2010s, the South African Revenue Service was much better at policing imported clothing to identify illegal imported goods to stop these from entering the country. Recently, it has been much less effective.”
Vlok said this was evident in the rise in second-hand clothing in places such as Marabastad in Pretoria, and downtown Johannesburg near Park Station, where the clothing was “sold at prices with which local clothing manufacturers cannot compete”.
At the other end of the market, car manufactures have seen a rise in the sale of second-hand cars. According to Rudolf Mahoney, head of brand and communications at WesBank, the used-car market has grown considerably.
“WesBank’s data shows that we now receive 2.5 used-car finance applications for every one new-car finance application. Two years ago this rate was 1.5 to one,” said Mahoney.
He said the shift to used was as a result of new-car inflation, which resulted in prices increasing more than 20% over the past two years.
This was compounded by the struggling economy and highly indebted consumers.
“The new-car market will recover when the economy starts growing at a higher rate, household debt levels improve and when salaries have caught up with the 20% price increases seen on new cars.
“WesBank expects flat vehicle sales numbers for 2017 and the recovery to start during 2018 — if the economy shows signs of recovery.
“Key players in the used market are doing well, but good-quality used stock is becoming scarce — keeping in mind that the new-car market becomes the supply for the used market.
“When the new market struggles, over time it will have an impact on stock supply for the used-car market. Dealers who can secure a supply of good preowned vehicles will thrive,” said Mahoney.
Unboxed Deals are returned products offered for sale at discounted prices We receive 2.5 used-car finance applications for every new-car application