Making S$30,000 a month from sneakers? That is why nobody likes resellers

An adolescent who claimed to earn up to S$30,000 a month reselling collectible sneakers made the headlines recently.

He plies his trade by procuring limited-edition kicks such as for example Air Jordans and Adidas Yeezys and goes on to resell them at exorbitant prices with up to a 300 percent profit margin.

This teen isn't the only shoe trader out there. Actually, the sneaker industry is rife with resellers who are increasingly crowding out customers who actually want to wear their purchased shoes, simply for the sake of earning a quick buck.

Judging from the web comments by a great many other persons who were unhappy with the outrageous prices that resellers charge, I was definitely not the only one who felt my blood circulation pressure rising. It is the same feeling of getting fleeced into paying “tourist price” while shopping at a market in a foreign country because you are not a local.

As a lifelong shoe addict, I’ve done my fair share of crazy things, like walking barefoot in the rain to protect my important possessions from getting damaged.

But there is one thing I'll never do and that is to buy sneakers from a reseller at often more than its actual retail price.

While I am lucky to involve some disposable income to occasionally treat myself to indulgences like cool footwear, I just won't allow my hard-earned money to visit resellers whose ethically suspect practices cause such eye-watering prices in the first place.

In lots of ways, resellers who wipe out the stocks of in-demand products whether they are sneakers or the latest iPhones are really not so different from another universally reviled band of sellers - ticket scalpers.

Just last year, to the outrage of music fans, tickets to British crooner Ed Sheeran’s concert in Singapore were purchased by scalpers within 40 minutes. They subsequently reappeared on resale sites at prices as high as S$13,500 - almost 54 times a lot more than the original S$248 price for the most notable category ticket.

To score these coveted products or tickets, price gougers most commonly resort to underhanded tactics such as deploying bots to overwhelm e-commerce sites.

These programs can enter online queues a large number of times, which effectively wipes out a genuine customer’s hopes of getting a fair chance to get what they are after at retail price.

To make matters worse, resellers often snap up multiple bits of the same product (or whole blocks of concert seats) to create an artificial demand, which eventually ends up further driving up prices on the secondary market, often to unconscionable proportions.

In the pre-coronavirus days, when resellers would camp outside stores overnight to obtain practical popular releases, there was perhaps a tiny argument that there is some utility from what they did.

They were in the end, practicing arbitrage by bridging a gap available in the market - they sold the service of standing in line overnight with respect to cash-rich but time-starved individuals.

Even then, this often devolves into an ugly practice with persons blatantly cutting queues and fighting over their place in line, sometimes even resorting to assault to seize whatever stock is available.

However, not absolutely all reselling ought to be frowned upon. For instance, there are people who resell or trade within their own sneakers or other possessions to invest in their next purchase and why not? Given that is sustainable consumption put into practice.

Where the line ought to be drawn through, reaches the rent-seeking behavior of resellers who hoard products to flip huge profits without benefitting anybody or adding any value to the market.

This is not simply a shoe collector thing as this applies to a great many other consumer products too.

In fact, most of us probably vividly remember the frustration of being struggling to get supplies such as disinfectant wipes, hand sanitizers, masks, and even wc paper to get early in the pandemic, and then discover listings for these necessities at high prices on sites like Carousell.

Collectible sneakers are not “essential” nonetheless it still stings to visit a profiteer brag about reselling some shoes you were not able to snag because of their sneaky ways, often within a few minutes of launch.

Thankfully, retailers have already been hard at work trying to curb this unfair behaviour by implementing purchasing limits. Many websites also have bot detectors to weed them out but of course, this is a never-ending game of cat and mouse with resellers deploying a lot more “intelligent” programmes to game the machine.

For particularly coveted sneakers, some retailers also have executed innovative ways to give genuine customers a better shot.

For instance, to recognize real buyers, influential sneaker shop Limited Edt recently ran an Instagram competition for a recent release of Nike Dunks, among this year’s hot shoes - and threw in a free of charge personalization service to keep these kicks off the resale market.

And sometimes when you can’t beat them at their game, it might just make the most sense to have a step back and opt-out of the toxic resale culture.

According to a recently available report by sneaker marketplace Ox Street, about 80 percent of sneakerheads have tried to get shoes on the resale market - surely this is exerting upward pressure on sneaker prices to no one’s benefit except the seller’s.

Where the line ought to be drawn through, reaches the rent-seeking behaviour of resellers who hoard products to flip huge profits without benefitting anybody or adding any value to the marketplace.

This is not only a shoe collector thing as this pertains to a great many other consumer products too.

In fact, most of us probably vividly remember the frustration of being struggling to get supplies such as for example disinfectant wipes, hand sanitizers, masks, and even wc paper to get early in the pandemic, and then discover listings for these necessities at high prices on sites like Carousell.

Collectible sneakers are not “essential” nonetheless it still stings to visit a profiteer brag about reselling a set of shoes you were not able to snag because of their sneaky ways, often within minutes of launch.