Improved margins

A structural shift in distribution channels has fueled the growth of the secondhand luxury goods market in China.

Livestreaming e-commerce, in particular, has allowed buyers from around the world to see product details in real time and helped build trust in product authentication, said Yang.

Secondhand luxury goods company Senza Group was established in 2022. Company co-founder Liang Guanrong said the lucrative overseas market helped its overseas business surge past 50 percent in 2025, and the growth rate is expected to remain at around 30 percent this year.

In the past, they only made 50 yuan profit on a bag sold for 5,000 yuan, he said.

However, overseas markets offer significantly higher margins. For example, a Louis Vuitton Speedy 25 handbag, a signature piece of the French brand, can be sourced in China for 6,000 to 8,000 yuan depending on its condition, and sold in the US for about $1,500, or approximately 10,230 yuan.

The same bag typically retails for $1,700 to $1,800 in the US secondhand market. Even after accounting for tariffs (around 15 percent for the US) and logistics costs, the arbitrage remains profitable, Liang said.

Simeon Siegel, an analyst at BMO Capital Markets, said major overseas secondhand luxury goods platforms like The RealReal and Vestiaire Collective will be at a cost disadvantage if they cannot effectively tap into China's supply side.

"China's secondhand luxury (goods) supply is becoming a major variable in the global market," he said.

Vast stocks

The success of Chinese secondhand luxury goods companies is in line with the global trend of the sector.

Pang Tao, general manager of sales and category management at eBay Greater China, said secondhand luxury goods are gaining more attention from consumers.

"For the past three years, the circular economy has grown rapidly on eBay, and secondhand luxury goods are a key part of that. Since 2024, preowned and refurbished products have accounted for more than 40 percent of eBay's gross merchandise value. Globally, 89 percent of consumers plan to continue, or increase, their purchases of secondhand goods, with Gen Z and millennials driving the trend," he said.

Luckily, China has a rich reserve of secondhand luxury products due to the country's rapid economic development in recent decades and people's increasing wealth.

According to the China Used Goods Association, secondhand luxury goods accounted for more than one-fourth of the country's 1.23-trillion-yuan secondhand goods transactions in 2023.

"China has been the world's largest primary luxury consumer market for years, accumulating a vast stock of pre-owned goods, many of which are in near-mint condition," said Pang.

Jane Hali, a retail analyst at Jane Hali & Associates, said that The RealReal's primary supply source remains the United States. But China has "an enormous and price-competitive inventory of secondhand luxury goods", she said.

Chinese companies' high level of digitalization has also made them stand out from their overseas peers.

A large number of Chinese sellers have fully digitalized their operations, including procurement, authentication, warehousing, maintenance and compliance, by using enterprise resource planning and inventory management systems, Pang said.

"For major sellers in China, everything runs on IT systems. But sellers in neighboring countries are still using pen and paper to track inventory. That efficiency gap directly translates into cost and speed advantages," he said.