A booming and fast-growing luxury segment

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BEIJING: With the rising prices of luxury goods and the rise of live e-commerce in the country, second-hand luxury goods are experiencing strong growth in China.

China has emerged as a major market for new and used luxury goods with significant growth potential, but a solid industry standard has yet to be established.

To this end, a luxury goods professional committee was established last Friday to better respond to market demand by the China Entry-Exit Inspection and Quarantine Association – a national voluntary non-profit social organization composed of market players related to the entry-exit inspection and quarantine sectors. from the country.

The committee aims to formulate industry standards and institutionalized communication mechanisms.

By bringing together experts, rating agencies and retailers, the committee hopes to unify rating standards and assess the valuation range of certain products.

“The rise of livestreaming sessions on e-commerce platforms has allowed more consumers to learn about the huge second-hand luxury market, and the growing demand has prompted the industry to jointly formulate standards of the ‘industry,” said Zhang Chen, director of CIQA’s luxury goods professional committee.

“There is a growing demand for luxury product appraisals from consumers and businesses, while appraisal fees are falling. Industry players should reach a consensus to avoid fierce price competition and expand the talent pool to promote the appraisal ability of different agencies,” Zhang said.

China has become the largest luxury consumer market in the world. In 2021, sales of personal luxury goods in China reached 471 billion yuan ($74 billion or RM311 billion), up 36% year on year, according to a report by consultancy Bain & Co.

Unlike some Western markets, young Chinese consumers have become the main demographic for luxury spending in China, and the trend has also been significant in the second-hand luxury market, according to a report by market research firm iResearch.

“With the continued expansion of the middle-income group in China and the current upward trend in consumption, Chinese consumers are paying more attention to brands and product quality.

“Yet there is no perfect industry standard, and counterfeit products have interfered with the operation and proper development of the market,” said Wang Xin, chairman of CIQA.

For second-hand luxury goods, its trade scale accounts for 5% of China’s total luxury market, which is 20% to 30% lower than figures seen in some developed markets, according to a report by Commerce University. international and economy and Youshe Yipai, a platform for second-hand luxury offers.

Despite the fact that spending on luxury goods has increased rapidly in China compared to developed markets such as Europe, the United States and Japan, the country lacks talent and experience in the luxury market.

“Identifying second-hand luxury goods would be an important business with remarkable room for growth in the future. The professional committee should do more industry analysis, provide guidance to the industry, and strengthen the promotion of more talents,” said Wang Qinhua, a former senior official with the Ministry of Commerce.

China Certification and Inspection Group, a leading third-party luxury identification agency in the country, now provides identification and training services to companies and individuals.

It identifies tens of thousands of luxury products each year, and these products include bags, jewelry and watches.

Meanwhile, Hongbulin, a second-hand luxury goods trading platform in China, said it had received six rounds of funding from investors and the company established a standardized process for evaluating non-standard products.

Hongbulin said it has cumulatively identified more than 10 million luxury goods and identified about 100,000 luxury goods units per month.

With around 100 reviewers and technologies such as big data, the company has formed a standardized service system for rating products while identifying logos, material textures and hardware for luxury goods. – Chinese Daily/ANN

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