2nd Hand Online Market In China

China 2nd Hand Market is growing

In recent years, with the continuous and accelerated development of the domestic economic level and e-commerce providers, the level of social consumption has also shown explosive growth, a great amount of consumption has also left a great deal of wasted/idle resources behind. In this context, the second-hand market turning waste into treasure began to perk up.

According to the analysis of “China’s Sharing of The Economic Development Report 2016”, the conservative estimate on the size of China’s idle second-hand market is expected to have reached 400 billion in 2016, while the share of the travel market represented by DiDi is only about 150 billion.

In Europe and the United States, the second-hand transaction has become a necessity of life service for a long time. According to the data from oversea classification information website, 60% of the traffic comes from second-hand transactions.  The huge growth space for domestic second-hand market is visualized.

E-Commerce Providers

E-commerce providers have also entered into domestic second-hand market, including Idle Fish from Department of Taobao, Go Shopping from 58 flagship, as well as Huishoubao and Aihuishou  and so on. Idle Fish claimed its current overall valuation to be over more than 3 billion US dollars;

China 2nd Hand Market

Aihuishou recently won 400 million D round financing; and  Go Shopping from 58 announced that transaction volume has more than 7 billion. These data include more and more investments in the second-hand market from e-commerce provider giants and businesses. It also shows in a different angle that the second-hand transaction market is in the blue ocean, and will become one of the future development potential of e-commerce providers.

JD.com Enters 2nd Hand Market

For example, JD.com has also entered into the second-hand market, via a separate website, with 3C electronics as the main product category, which is exactly a popular transaction category in the second-hand market.

 

China 2nd Hand Market

“Idle Goods Transaction Report for The First Half of 2016” published last year showed that the highest transaction volumes in the popular second-hand transaction categories are: mobile phone followed by clothing\shoes and hats, digital products, accounting for 17.5%, 14.63% and 10.7% of total orders respectively. It indicates that 3C is the most strongly demanded product in current domestic second-hand transaction market.

Furthermore, as far as JD.com’s entry into the second-hand market, it took Amazon’s second-hand transaction market Amazon Warehouse Deals as a reference. An E-commerce provider giant like Amazon will naturally produce a large number of returned products from users, waste\loss and refurbished goods during the distribution process. Amazon puts these goods together up for sale at its self-owned official second-hand market the Amazon Warehouse Deals. Categories include 3C, outdoor supplies, etc. All of the second-hand goods at Amazon Warehouse Deals are subject to Amazon quality inspection and strict classification. Coupled with lower prices, it has brought Amazon a great number of loyal users. Amazon’s second-hand transaction model can provide JD.com a fine reference. It can be said that JD.com’s second-hand transaction will transfer Amazon’s professional second-hand transaction model into China.

The entry into second-hand market by new giants naturally leads to concerns among the industry. Unlike the C2C model of Idle Fish and Go Shopping, JD.com’s second-hand transaction model is B2C. Currently, Idle Fish, Go Shopping and other C2C second-hand transaction platforms are mostly criticized for the mismatching of product information that is very prone to happen, non-transparency and other issues. The transaction platform is unable to monitor individual sellers.

Under this circumstance, it is inevitable that JD.com’s second-hand transaction platform with guaranteed goods quality, information transparency and certain standardized assessment on goods will produce impacts on chaotic second-hand transaction platforms such as Idle Fish, Go Shopping, etc.

The next few years, China’s second-hand goods transaction market will really show significant growth opportunity. At this moment, the enterprise that is able to accurately gauge the needs of buyers and sellers to make second-hand transactions more professional and efficient will become the real potential king of the market.

Lisa11

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