Did the value of secondhands change?

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bos
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Did the value of secondhands change?

Post by bos »

I've been thinking about how secondhand items have become more expensive over the years. This trend wasn't just a feeling. I decided to look at my own numbers. My secondhand account is almost 20 years old, which means I started it in my teens.

As a kid, my "job" was buying electronics from wealthy kids secondhand and reselling them. When I got older, I did the same by flipping motorcycles. Since I joined the working force I don't flip anymore, but do continue to buy second hands where possible. However, about four years ago, things started to change. The good deals began to dry up, and people started "overpaying". For example, I bought a new sleeping bag for €200 during an end-of-season sale (50% off) and later sold it secondhand for €320 after using it daily for six weeks on vacation The person could have bought the item, with 2 years of warranty for only 80 euro more, with an high change of the item being in sale again soon.

I think two factors contribute to this. First, secondhand in general has become much more popular. I remember my parents and friends used to found it odd that I bought items secondhand. They were curious about how it worked and whether I ever got robbed or scammed. Nowadays, there are advertisements for "vintage clothing" right on my street, and these items are worth more than new fast-fashion pieces.

Second, environmental awareness has increased. Even my parents have changed. They recently bought a secondhand table for environmental reasons. This shift has for sure affected the value. Which is a good thing! :)

Jacob once mentioned that secondhand items are getting closer to their true price. Is that what's happening? Were secondhand items always undervalued? How do you guys experience this?

zbigi
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Re: Did the value of secondhands change?

Post by zbigi »

I don't think second hand items were ever seriously undervalued in Poland. Polish society was just too poor and too thrifty for irrationally low prices to go unnoticed (and not corrected by the market). Maybe one of the reason of rising prices of used goods in the West is pauperization of society, particularly the young adults (who are also most likely to adopt new trends, such as buying used)?

loutfard
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Re: Did the value of secondhands change?

Post by loutfard »

Two more possible factors:
- optimising a closing information gap. One used to have to make a real effort. Information technology has made second hand arbitrage more accessible, so less profitable.
- ERE/FIRE mindset taking root? Probably wishful thinking...

ertyu
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Re: Did the value of secondhands change?

Post by ertyu »

Nah, it's not an ere mindset, it's the first thing you pointed out, loutfard. resellers that make it their business to dig out good finds causing the second hand stores themselves to go, wait a second, we could be sorting these goods into tiers and charging that. The arbitrage gap is closing on both ends due to increased info and business savvy.

Henry
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Re: Did the value of secondhands change?

Post by Henry »

On-line shopping changes the game. Hollywood Chic ends the game.

https://www.cnbc.com/2024/05/29/benefit ... stone.html

7Wannabe5
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Re: Did the value of secondhands change?

Post by 7Wannabe5 »

Yes, I've definitely noticed this. OTOH, it's become easier to find a new pair of jeans on the clearance rack for $4 at the same super-store where you might simultaneously be paying $8 for a jumbo pack of toilet paper. I remember BRUTE making the point once that a cheap textile is a cheap textile, and what we arbitrarily designate a throw-away can be oddly culturally determined. For nth degree example, the extent to which we do not depreciate our education and training as an asset when we retire or semi-retire "early" due to our cultural belief in personal freedom. Or maybe this is more in my mind at the moment due to the fact that I recently spent approximately the cost of an okay mid-grade used car to purchase myself a new grad degree at the age of 59.

bos
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Re: Did the value of secondhands change?

Post by bos »

loutfard wrote:
Thu May 30, 2024 2:04 am
- optimising a closing information gap. One used to have to make a real effort. Information technology has made second hand arbitrage more
This is a great observation that I missed. Platforms show sellers what the item is worth. If you upload an Iphone it shows that Iphone's are usually sold between X and Y. As Ertyu highlights; Data closes the gap for both sides, which is a bad thing if you are good at making deals.

jacob
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Re: Did the value of secondhands change?

Post by jacob »

The secondhand market is definitely becoming more efficient.

It's not just that there's more information about what the price should be but that the logistics infrastructure has been put in place to make it easy to move goods. There are basically more rent-seeking entrepreneurs and businesses who have inserted themselves between the ultimate seller and the ultimate buyer.

It used to be that a local thrift store took a small profit from the $0 that the donator got resulting in the buyer ending up with most of the "profit" by getting good stuff very inexpensively. Today, this profit is often split between several resellers, arbitragers, marketplaces, shipping companies, ...

The result is that not only is secondhand getting more expensive. There's also less $0 supply available.

Overall, this is actually a good thing since it means that stuff is being put to good use and less money is lost in the process of ownership.

Henry
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Re: Did the value of secondhands change?

Post by Henry »

I just learned that the outside clothing bins you tear your rotator cuff trying to stuff hefty bags stuffed with old clothing are privately owned and operated by companies euphemistically called clothing recyclers. They bail the clothes up and sell them by weight. Sometimes overseas.

Frita
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Re: Did the value of secondhands change?

Post by Frita »

As thrifting is becoming more trendy and economically attractive, prices have risen. Buying for life as @Jacob says makes even more sense.

About an hour ago my son informed me that my favorite leggings wear like a diaper. Until involuntarily retiring, I never wore such clothing. My preferred fit is between a legging and sweatpants. I am actually glad to have bought the two pairs I did, for about $100 total. (Not washing after every wear, using cold water, and line drying; they wear like iron.)

bos
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Re: Did the value of secondhands change?

Post by bos »

Henry wrote:
Thu May 30, 2024 1:51 pm
I just learned that the outside clothing bins you tear your rotator cuff trying to stuff hefty bags stuffed with old clothing are privately owned and operated by companies euphemistically called clothing recyclers. They bail the clothes up and sell them by weight. Sometimes overseas.
My friend's dad has a successful business selling and buying vintage clothing. He became wealthy in recent years ago when 90s Nike and Adidas shirts became more valuable than new ones. He acquired most of the shirts for 0.50 cent per kilo and has been storing them for almost 30 years. A quality 90s vintage sport shirt can sell for 40 euros here.
Frita wrote:
Thu May 30, 2024 8:55 pm
Buying for life as @Jacob says makes even more sense.
Do we maintain an ERE list of buy-it-for-life approved brands? I have the feeling as soon as those brands get populair as "buy-it-for-life" they move production overseas and drop quality. Looking at you Carhartt and Redwing. My Carhartt jeans from 7 years ago look fine while my new ones have a hole in less then 6 months.

jacob
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Re: Did the value of secondhands change?

Post by jacob »

bos wrote:
Fri May 31, 2024 1:20 am
Do we maintain an ERE list of buy-it-for-life approved brands? I have the feeling as soon as those brands get populair as "buy-it-for-life" they move production overseas and drop quality. Looking at you Carhartt and Redwing. My Carhartt jeans from 7 years ago look fine while my new ones have a hole in less then 6 months.
I'm not aware that we have a list and you're right about what happens to brands once they get discovered by the public. I've gone back and forth on this over the years in terms of whether the BIFL the best of the best or whether to buy the cheapest option possible and treating it as as expendable/consumable. In practice, I do both. My main objective is to avoid "upgrade-fever" in which I'd want to buy a slightly better model in a short time and so on. The "best" is already at the top. The "worst" is already at the bottom.

The alternative to BIFL is to get good at the secondhand/reselling game treating everything as something you "rent" until you sell it again. While easier than ever, selling secondhand still takes effort and time depending on how much money you want to recover.

ducknald_don
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Re: Did the value of secondhands change?

Post by ducknald_don »

I've noticed for clothes that quality doesn't seem to vary much once you get above the bottom tier. I could buy a pair of jeans for £15 and they won't last very long at all or a good pair for £30. It seems there is nothing to be gained for spending more than that other than a label (or a tear in the knee).

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Sclass
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Re: Did the value of secondhands change?

Post by Sclass »

I think there are several drivers here. Most you guys have hit. Efficient online marketplaces are good for pricing. Pauperization of society. Changing attitudes towards vintage both from an environmental and quality view.

I have a personal take I can contribute. Cost of new tech has gone down.

I design new versions of old tech and I can grind the prices down by replacing old chips with new ones. I made a small business making replacement parts for old cars using new tech. It’s cheaper for me to make modern digital electronics than it is for Mercedes Benz to keep manufacturing vintage analog electronic parts for their old cars. New processes are just cheaper.

I have a lot of advantages all of which come from using 2020 tech over 1980 tech. I was able to arbitrage this discrepancy to dominate a corner of the replacement parts market. I basically compete against little kids in Bangladesh hand soldering analog op amps to through hole circuit boards. They need precision resistors and capacitors to obtain nominal filter frequencies. I just use a 2020 $0.50 microcontroller running a mathematical formula which is just code to produce the same output using a kind of digital synthesis. I don’t require precision manufactured components or calibration because the math is always the same. Cheap chip + code trumps 1980s tech. Assembled by a robot in Shenzen without Bangladeshi child labor. I’ve crushed the refurb market for this particular device. The clients would be crazy to buy refurbs though some collectors insist on keeping their vintage Mercedes 100% vintage.

chris580
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Re: Did the value of secondhands change?

Post by chris580 »

I believe another factor may be the major tech gatekeepers such as Amazon, Google, EBay etc. changing their policies to favor certain second hand vendors over others, leading to fewer vendors. I looked into online reselling in the not too distant past and many long-time vendors were complaining about this. I could see why the gatekeeps would do it; they believe can better control the quality (and hence their reputation), limit the number of sellers (driving up prices and possibly manipulating the availability of products for various marketing purposes), and extract more money from their approved vendors.

I feel like I, the consumer, have lost out from this limited gatekeeper market, and I also feel like my entrepreneurial opportunities have been limited so the gatekeepers can make more billions for their AI spam projects.

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