The trend is confirmed by Liu Bo, general manager of TusStar Venture
The Chinese luxury goods sector has received a steady stream of investments in recent years. TusStar is one of the capital investors that pays money in the sector, acting as the main investor for the high-end operator of used Ponhu-Luxury.
Building an integrated offline platform for second-hand luxuries is what the market will need in the future, TusStar Venture’s general manager Liu Bo told TechNode.
“In Japan, the penetration rate for used luxury goods has reached a 1: 1 ratio, which means that every time a new stock is bought, an old one will be resold. In China, only 3% of the stock is sold. Basically, nobody bought second-hand luxuries,” Liu said.
TusStar invests in high-tech, high-growth start-ups
Liu expects growth in the market for the sale of high-end used products in China. “One must think that one day, if an economic recession hit China, second-hand luxuries would retain their value as they did in Japan in the past. The cultures of East Asia are similar. We see promising growth points in the luxury sector second-hand in China “.
In his current role, Liu keeps an eye on TMT investment opportunities, energy savings and the environment, as well as the new economy and new services.
Moreover, TusStar invests in high-tech and high-growth start-ups, focusing mainly on TMT, mobile internet, cleantech, new material, health care, advanced production, education, intelligent hardware and consumption area. The company, in confirmation of this, has signed agreements with over 300 startups and so far has invested over 2 billion RMB.
But China, despite strong progress, seems to appreciate offline trade more
Some argue that digitization is the main driving force behind luxury sales in China, but Liu argues that the real “battle” develops offline. “Only some users might consider buying luxuries online. Most customers, in fact, care little about the discount, aiming more at brands and quality.”
According to a report published by Bain Analysis in 2019, although online luxury sales have surpassed the global market in 2018, online penetration in other luxury categories remains very low, with the exception of cosmetics.
“There are still many opportunities to build platforms in this area,” Liu said. “But it’s not the kind of e-commerce platform on the Internet that people talk about today, but an offline platform that unites all the key nodes of the entire commercial chain.