PETALING JAYA: Like most pre-owned luxury goods market in other countries, the business is growing in Malaysia with its current value estimated at almost RM4bil.
“The market for secondhand luxury is more active as many from the middle income groups cannot afford the retail price of these products,” said Universiti Tun Abdul Razak (UniRazak) economist Prof Dr Barjoyai Bardai.
He said the secondhand or preloved industry in Malaysia is valued between RM2bil and RM4bil.
Prof Barjoyai predicted that the secondhand luxury sector could soar even more once the government implements the High Value Goods Tax (HVGT) in May.
Budget 2024 stated that the HVGT on high-value goods would be between 5% and 10%.
The tax is expected to be imposed on big-ticket items such as private jets, jewellery and luxury cars.In one report quoting sources, The Star said there could be thresholds for these items to be taxed, such as only cars sold above RM200,000, watches priced more than RM20,000 and jewellery worth RM10,000 and above.
However, Prof Barjoyai also raised a concern about the authenticity of luxury items being sold online without proper certification once the secondhand luxury became the choice for the middle class category.
China Daily, in a report dated Nov 28, 2023, which cited a market research firm, said that the secondhand luxury goods market in the Middle Kingdom had grown to such a size that “the potential value of all the products that could be traded could exceed 3 trillion yuan”.
Young female consumers, who are the prime driver of the secondhand luxury goods market in China, would go for high-end bags, attire and shoes.
Meanwhile, a 2021 report by global secondhand market, Thredup, found a rising interest in the secondhand luxury sector from consumers globally.
The market is expected to more than double over the next five years to US$77bil (RM363bil).
In Malaysia, pre-loved businesses found that the sale of secondhand luxury brands shot up during the Covid-19 pandemic in 2020 and shows no sign of declining.
“Ever since the lockdown (due to Covid-19), interest in pre-loved luxury brands went up,” said Benji Choo, who is a business development manager of larue, a Malaysian-based pre-loved purchasing business.“This is mainly because people want to get their hands on certain products, like handbags, of certain brands,” he said.
He said these pre-loved products are priced about 20% to 30% less from their initial prices.
“What makes it more attainable is that some of the bags are sold considerably cheaper than their original price but still in good condition from pre-loved boutiques, or grey markets, as some call it,” he said.
Choo projected that the demand for branded goods would go up come May when Malaysia introduces the HGVT.
Most of his clients are Malaysians, he said, adding that larue would purchase and sell luxury items from them.
These goods, he said, would be inspected by an in-house appraiser to verify their authenticity.
He also said that people tend to sell their luxury items for financial reasons.
“But most of the time, our clients sell their belongings when they feel it is out of trend.”
Bandoru Holdings Sdn Bhd group chief operations officer Tengku Asyraf Tengku Sallehuddin said the company also saw significant increase in sales since the movement control order.
Among the hot items at Bandoru stores so far have been handbags and denim items, he said.
“This surge in sales can be attributed to people seeking out cheaper alternatives and cost-saving opportunities as many realise that they can save by purchasing pre-loved items instead of paying higher prices for new ones.”
Tengku Asyraf said the price range for handbags at Bandoru varies, depending on factors such as the brand, condition and rarity.
“Denim items have also been a hit among customers at Bandoru at prices ranging from RM20 to RM500,” he added.
