I'm not sure if this is the case. I've heard from posts on this forum that Hermes knows it sells to resellers and they are secretly fine with it, even though outwardly they may say they don't want their bags to get into resellers. It's not possible to know exactly what they think, but they clearly haven't seemed to do enough tp stop resellers. They are literally all over the internet. Brand new bags from "personal shoppers," they even say "fresh from boutique" or something like that. It's really frustrating as a genuine customer would would never sell my Hermes bags ever, that these resellers are taking up stock that could go to us. This is why I will never buy a handbag from a reseller site or pre-loved.
Why so many Birkins available on the resale market?
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I'm not sure if this is the case. I've heard from posts on this forum that Hermes knows it sells to resellers and they are secretly fine with it, even though outwardly they may say they don't want their bags to get into resellers. It's not possible to know exactly what they think, but they clearly haven't seemed to do enough tp stop resellers. They are literally all over the internet. Brand new bags from "personal shoppers," they even say "fresh from boutique" or something like that. It's really frustrating as a genuine customer would would never sell my Hermes bags ever, that these resellers are taking up stock that could go to us. This is why I will never buy a handbag from a reseller site or pre-loved.
Profiteering is when people jack up pricing on essentials (e.g., N95 masks, sanitizing wipes during a pandemic). Re-selling luxury goods at a price the market can bear is very far from that.
Why would there be any laws against this? This is the essence of capitalism — there is a desired good, there are legal channels of obtaining it, it leads to a certain market-clearing price. As long as the reseller pays income tax, they are good.
I have never sold a single Hermes bag and prefer to buy bags from the boutique. And personally, I think there are easier ways to make money than re-selling bags... But Hermes is largely to blame for this situation — they make quota bags hard to get and make customers play games to get them. There is of course a ‘natural’ shortage — there are only so many bags they make. But all the talk about 1:1 spend and whatnot pushes people to resellers — why bother cowtowing to your SA to buy a ton of stuff to be maybe, possibly offered a bag? I would go to a reseller, too.
I have heard of it happening. I think it is pretty hard to prove though — unless it is a really recognizable bag such as an unusual SO, there are ultimately lots and lots of bags sold worldwide.
I think Hermes understands that people might want to resell or gift bags when they are tired of them. They would take issue with walking out of the boutique with a new bag and putting it on TheRealReal. But once again, it’s very hard to prove.
My point w ac
My point exactly - there won’t be laws against it. But that doesn’t mean I have to like it nor support it. The only way resellers will stop hoarding all the stock from the boutiques is if people stop buying from them. So we as customers have the power here.
My point exactly - there won’t be laws against it. But that doesn’t mean I have to like it nor support it. The only way resellers will stop hoarding all the stock from the boutiques is if people stop buying from them. So we as customers have the power here.
Hermes suffered significant product losses this year. Inevitably those bags will move to the secondary market as well.
So, I suspect it is a mix of people’s circumstances drastically changing with the pandemic which either requires them or causes them to re-think their need for these bags, people finding ways to supplement their income during unusual times and illegally obtained goods flooding the market.
So, I suspect it is a mix of people’s circumstances drastically changing with the pandemic which either requires them or causes them to re-think their need for these bags, people finding ways to supplement their income during unusual times and illegally obtained goods flooding the market.
I agree totally with your sentiments, @A1aGypsy. I'm also inclined to believe that the latter, which I've bolded, is having a larger effect on the resale market than it is currently being credited for.
I’m assuming they are referring to the looting that happened in the USA this summer, specifically the Chicago store’s back room was completely emptied by looters. However, I can not in any way see that accounting for more than a dozen or so quota bags in existence, let alone at big name resellers all at the same current time.
I think people just only need a certain number of handbags (different for each person) and eventually cast off the ones that overwhelm the collection and many of these end up with resellers. Meanwhile the thrill of the new bag offer from the store still tugs at them so they might accept an offer they don’t even want, knowing they can immediately flip it for a few extra bucks. It checks all the boxes; the dopamine hit from receiving the “honor of being offered by the SA”, showing it off on social media, and then flipping it for a small profit.
Oh I see.
So I actually tried to figure out the profit to be made (you know, in case I want to flip the Kelly sitting under my Christmas tree
)). Let's say the resale price is $20k. The Kelly (28 in Epsom) was around $12k with tax I think (my husband paid since it was a gift). When I google TRR's consignment policy, I can't find the actual percentages sellers get, but it says 'keep up to 70%,' so let's go with 70%. So we have:
- The bag sells at $20k
- The seller keeps 70% = $14k
- Profit = $14k - $12k = $2k.
Plus, the seller needs to pay tax on that $2k come tax season. I am not sure how that is taxed, but let's say at the regular income tax rate, which for people in the higher tax bracket can be, say, 40% all-in (probably more). That leaves our hypothetical seller with $1,200. Hardly a major profit, is it? Of course, if that same seller goes through other channels, that profits could be higher.
This makes me think that enjoying the bag offer, getting it, and then realizing one doesn't need more bags, especially during the pandemic, and then selling it is probably a likely explanation of this phenomenon.
Oh I see.
So I actually tried to figure out the profit to be made (you know, in case I want to flip the Kelly sitting under my Christmas tree
So we have:
- The bag sells at $20k
- The seller keeps 70% = $14k
- Profit = $14k - $12k = $2k.
Plus, the seller needs to pay tax on that $2k come tax season. I am not sure how that is taxed, but let's say at the regular income tax rate, which for people in the higher tax bracket can be, say, 40% all-in (probably more). That leaves our hypothetical seller with $1,200. Hardly a major profit, is it? Of course, if that same seller goes through other channels, that profits could be higher.
This makes me think that enjoying the bag offer, getting it, and then realizing one doesn't need more bags, especially during the pandemic, and then selling it is probably a likely explanation of this phenomenon.
I'd be inclined to agree with this. I'd say it is part of human nature to feel the exhilaration of something "new" and "exclusive" (not commenting on healthy or not, but it certainly is part of the physiological process) and then tire of it quickly (once the thrill of the honeymoon is over). I am pretty sure entire threads have been devoted to this in some of the other brands, and I personally think this is how some brands operate that are constantly bringing out new x y or z bags all the time. That was one of the main reasons why I actually stopped buying any other bags. To me, it was like playing yet another "game" of "chase the new handbag". I have my few H bags I love, and like the fact that they change little over time. (I have a Bolide, Evelyne, Garden Party TPM with a strap and a couple of lovely and long since discontinued vintage H bags. And I am very happy with them.)
Oh I see.
So I actually tried to figure out the profit to be made (you know, in case I want to flip the Kelly sitting under my Christmas tree
So we have:
- The bag sells at $20k
- The seller keeps 70% = $14k
- Profit = $14k - $12k = $2k.
Plus, the seller needs to pay tax on that $2k come tax season. I am not sure how that is taxed, but let's say at the regular income tax rate, which for people in the higher tax bracket can be, say, 40% all-in (probably more). That leaves our hypothetical seller with $1,200. Hardly a major profit, is it? Of course, if that same seller goes through other channels, that profits could be higher.
This makes me think that enjoying the bag offer, getting it, and then realizing one doesn't need more bags, especially during the pandemic, and then selling it is probably a likely explanation of this phenomenon.
I am so surprised with your calculation.
From my perspective (in Europe), a Birkin 25, which costs in "standard" version (depending on leather of course) around 7.000,00 EUR in the shop, is currently being sold on one of the biggest reseller sites (VC in this case) for 15-20.000,00 EUR. And there are a lot of the 25 Birkins offered at the moment, all in this price range! VC is taking approximately 1.500,00 EUR commission for this sale (this can easily be verified on their site). This leaves reseller with many thousands of EUROS. I guess this explains why bags are being bought in the shop and immediately offered on the resale market, without being used or tried out.
The actual sold prices are much lower.
There really are a lot Birkin 25s for sale on VC. 85 in fact. I am shocked. This makes me wonder if there is a decline in Asian buyers.
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Even so, the (considerable) profit made out of these particular purchases is making it a booming business!
It's possible. I am pretty sure TRR and many other U.S. consigning services take a very high percentage of the sold price. eBay is no more than 10% commission I think, so that would save a fair bit of money in my example. I think fewer bags are sold there at truly high prices though -- buyers usually prefer more 'vetted' services. But yes, if you manage to sell the bag from my example sold at $12k on eBay for $20k, that, leaves the seller with $8k - 10% commission (or less) = $6k. If the seller pays tax and if I understand the taxation correctly, that is $3k+ of profit post-tax.
U.S. retail prices are higher than the European ones though + we often pay sales tax, let's 6-8% on top of that. If one manages to not pay the tax on the profit (perhaps easier to avoid in Europe? no idea how that works, and obviously not recommending that), then yeah, the European market looks more advantageous.
All the above is purely hypothetical though, I don't have any firsthand experience. If someone does and would like to share, I would be quite curious.