A 2% decline in the real net wealth of South Africans isn’t bad news for everyone.
While Stats SA has reported a corresponding slump in conventional retail sales in the first quarter of 2017, as a start-up franchisee, you can take advantage of this economic predicament.
“We need to get past the doom and gloom and recognise that there is a silver lining in the second-hand goods market,” says Cash Converters CEO, Richard Mukheibir.
Second-hand goods are making a comeback. Engaging well with the influential millennial stance to ‘reduce, recycle and repurpose’, is the best way to respond to this development.
Here’s why considering a franchise that’s geared towards previously-owned goods could be your best bet:
1Pre-loved is popular
According to Bidorbuy CEO Jaco Jonker, second-hand goods account for as much as 40% of all items recently sold on the company’s site.
South Africans are hoarding up to R35 000 worth of unused items in their homes, according to a survey conducted by fellow online marketplace Gumtree.
“Putting that cash back into circulation is quite significant,” explains Gumtree SA spokesperson Estelle Nagel, adding that the results of the survey indicate the stigma previously associated with second-hand goods has been firmly dismissed.
True to the millennial consumer, popular items sold on these sites include electronics, particularly smartphones and laptops.
2Greening the economy; stretching the rand
“Buying second-hand makes sense for the environment and has very clear benefits for those concerned about excessive consumerism,” says Mukheibir.
“It began with the trend for vintage goods, furnishings and clothing and has extended into savvy second-hand buying and selling of staples of modern life, such as electronic devices.”
While early adopters of new technology snap up the latest version of technological devices upon their release, environmentally conscious shoppers line up to buy the discarded devices. This is because the latter know they’ll get a bargain as on these often nearly-new goods.
This should create a constant flow of stock and customers relieving you of that stock quite quickly and consistently.
3Cheaper and safer than before
While Mukheibir believes buying through a bricks-and-mortar store gives consumers additional protection and reassurance, Bidorbuy and Gumtree have seen second-hand goods surge in demand to just under half of all goods sold.
“There are dangers in buying second-hand online because you’re more vulnerable to scams and con artists,” says Mukheibir, but as of 2009 SA consumers’ are protected by the Second Hand Goods Act and they receive further support under the Consumer Protection Act.
So, while you may not think selling other people’s discarded items is a good business idea, consider the millennial consumer who’s looking out for the environment and their pocket. Whether you go online on bricks and mortar, remember that a few people’s trash could pave the way to your business’ success.