Thursday, December 13, 2018

Pakistan is the World's Biggest Importer of Used Clothes

Back in the winter of 1977 when I made preparations to travel to the United States to attend graduate school, my late mother took me to Karachi's "Landa Bazar" to help me pick out imported extra warm second hand clothing. The purchased item appeared to be brand new, especially after dry-cleaning. I would not have survived my first months in New York without the winter coats and jackets and accessories like caps, gloves and boots bought in Karachi, Pakistan. A recent look at the Statista stats portal's 2017 data revealed that Pakistan imported $240 million worth of used clothing making it the world's largest importer in this category.

Landa Bazars in Pakistan:

A Pakistani newspaper headline last week screamed "Sale Of Second Hand Warm Clothes Picks Up In Landa Bazars Hyderabad". Landa Bazars is the name of "flea markets" that specialize in selling used clothes and they do brisk business at the start of each winter. These markets are found in all major cities and cater to middle-class and poor customers looking for moderately priced warm clothing for a couple of weeks of cold weather. Pakistan has a huge domestic textile industry that meets the needs of the people with relatively cotton clothing for the rest of the year. Pakistan is also a big exporter of ready made garments.

Top Importers of Secondhand Clothing. Source: Statista

The second hand clothing that I used in my first few months in the United States in the winter of 1977-78 was purchased at Karachi's Landa Bazar. The purchased item appeared to be brand new, especially after dry-cleaning.  In the next winter season when a new batch of Indian and Pakistani students came to the campus, I passed these on to those who came unprepared my heavy winter coat and jacket.

Landa Bazar (Flea Market) in Pakistan


Second Hand Clothing Trade:

Used clothing exports added up to $3.67 billion in 2016, according to MIT's Observatory of Economic Complexity (OEC).

The top exporters of Used Clothing included the United States ($648M), Germany ($371M), the United Kingdom ($348M), China ($219M) and South Korea ($214M). The top importers in 2016 were Pakistan ($206M), Ukraine ($166M), Kenya ($131M), Malaysia ($129M) and Ghana ($126M).

Second Hand Clothing in United States:

Americans donate used clothes, including slightly used clothes hanging in their closets, to charities such as Goodwill and Salvation Army. These donations pick up during holidays when people clear out their closets to make room for new purchases. American tax law encourages such charitable donation which are tax-deductible. Some of these used clothes are sold by charities at stores like Goodwill stores and Salvation Army thrift stores and the rest are exported.

America's secondhand clothing business has been export-oriented since the introduction of mass-produced gar­ments. And by one estimate, used clothing is now the United States’ number one export by volume, according to Slate.com.

Summary:

Global trade of secondhand clothing is near $4 billion a year. United States is the biggest exporter and Pakistan is the biggest importer of used clothing.  The second hand clothing that I used in my first few months in the United States in the winter of 1977-78 was purchased at Karachi's Landa Bazar. The purchased item appeared to be brand new, especially after dry-cleaning.  In the next winter season when a new batch of Indian and Pakistani students came to the campus, I passed these on to those who came unprepared my heavy winter coat and jacket.  Landa Bazars is the name of "flea markets" that specialize in selling used clothes and they do brisk business at the start of each winter. These markets are found in all major cities and cater to middle-class and poor customers looking for moderately priced warm clothing for a couple of weeks of cold weather. Pakistan has a huge domestic textile industry that meets the needs of the people with relatively cotton clothing for the rest of the year.

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10 comments:

Imran Q. said...

US is still the cheapest country ... even the second hand clothing is a huge business. I had ubered in Minnesotta, the Uber driver was a somali and he was into large scale 2nd hand used shoe exports to Somalia. its a Multi million dollar business too.

Najam said...

Do you know that this old clothes Market ie Lunda Bazar has completely been razed during recent Anti Encroachment operation in progress in Karachi. Other major markets Empress Market and Jodia Bazar have also been effected.

Abdul said...

Interesting reading! even Russia Malaysia import seconds hand clothes that's surprised me.

Junaid said...

its not only imported to be sold in local market most of the containers imported are sorted/graded packed into smaller bales and re exported to africa its a huge and profitable trade.

Riaz Haq said...

Junaid: " its not only imported to be sold in local market most of the containers imported are sorted/graded packed into smaller bales and re exported to africa its a huge and profitable trade."

Pakistan exported $35 million worth of used clothes in 2016, according to the Economic Observatory at MIT.
Not sure if these are locally made/used or re-exports.

https://atlas.media.mit.edu/en/profile/hs92/6309/

Ali said...

For the record ----- make the correction
Most of it goes to Afghanistan and Iran

Ramesh said...

As an Indian I appreciate this. Throwing away gently used clothes is only an ecological calamity.

Riaz Haq said...


A massive force is reshaping the fashion industry: secondhand clothing. According to a new report, the U.S. secondhand clothing market is projected to more than triple in value in the next 10 years – from US$28 billion in 2019 to US$80 billion in 2029 – in a U.S. market currently worth $379 billion. In 2019, secondhand clothing expanded 21 times faster than conventional apparel retail did.

https://theconversation.com/secondhand-clothing-sales-are-booming-and-may-help-solve-the-sustainability-crisis-in-the-fashion-industry-148403

Even more transformative is secondhand clothing’s potential to dramatically alter the prominence of fast fashion – a business model characterized by cheap and disposable clothing that emerged in the early 2000s, epitomized by brands like H&M and Zara. Fast fashion grew exponentially over the next two decades, significantly altering the fashion landscape by producing more clothing, distributing it faster and encouraging consumers to buy in excess with low prices.

While fast fashion is expected to continue to grow 20% in the next 10 years, secondhand fashion is poised to grow 185%.

As researchers who study clothing consumption and sustainability, we think the secondhand clothing trend has the potential to reshape the fashion industry and mitigate the industry’s detrimental environmental impact on the planet.

The next big thing
The secondhand clothing market is composed of two major categories, thrift stores and resale platforms. But it’s the latter that has largely fueled the recent boom. Secondhand clothing has long been perceived as worn out and tainted, mainly sought by bargain or treasure hunters. However, this perception has changed, and now many consumers consider secondhand clothing to be of identical or even superior quality to unworn clothing. A trend of “fashion flipping” – or buying secondhand clothes and reselling them – has also emerged, particularly among young consumers.

Thanks to growing consumer demand and new digital platforms like Tradesy and Poshmark that facilitate peer-to-peer exchange of everyday clothing, the digital resale market is quickly becoming the next big thing in the fashion industry.

The market for secondhand luxury goods is also substantial. Retailers like The RealReal or the Vestiaire Collective provide a digital marketplace for authenticated luxury consignment, where people buy and sell designer labels such as Louis Vuitton, Chanel and Hermès. The market value of this sector reached $2 billion in 2019.

The secondhand clothing trend also appears to be driven by affordability, especially now, during the COVID-19 economic crisis. Consumers have not only reduced their consumption of nonessential items like clothing, but are buying more quality garments over cheap, disposable attire.

For clothing resellers, the ongoing economic contraction combined with the increased interest in sustainability has proven to be a winning combination.

More mindful consumers?
The fashion industry has long been associated with social and environmental problems, ranging from poor treatment of garment workers to pollution and waste generated by clothing production.


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High-quality clothing traded in the secondhand marketplace also retains its value over time, unlike cheaper fast-fashion products. Thus, buying a high-quality secondhand garment instead of a new one is theoretically an environmental win. But some critics argue the secondhand marketplace actually encourages excess consumption by expanding access to cheap clothing.

Riaz Haq said...

Poshmark IPO Speaks Volumes About Fashion’s Future

https://sourcingjournal.com/topics/retail/poshmark-ipo-fashion-resale-secondhand-holiday-pajamas-onesie-luxury-251743/


Poshmark filed its prospectus Thursday for an initial public offering after finally turning a profit this year. The move follows secondhand rival ThredUp’s October IPO filing, underscoring the sky’s-the-limit growth potential for the booming fashion resale market, fueled in large part by eco-conscious millennial and Gen Z consumers whose full spending power has yet to be seen.

Unlike ThredUp or luxury peer The RealReal, similarly Bay Area-based Poshmark courts individual buyers and sellers to its online fashion marketplace for secondhand goods, allowing them to transact directly with each other for a small fee. Since launching in 2011, the company says it has attracted more than 70 million users and sold more than 130 million items, pushing cumulative gross merchandise volume (GMV) to $4 billion. Active users last year spent an average of 27 minutes on its site, connecting with each other through 20.5 billion social interactions.

“Secondhand and resale also continue to grow as consumers, particularly younger generations, adopt efforts to reduce overall consumption and support a more sustainable economy,” Poshmark said, citing its Social Commerce Report, executed with Zogby Analytics, stating that 16 percent of the Gen Z consumer closet is secondhand, versus 10 percent for baby boomers.

“According to that report, 72% of our U.S. users often consider an item’s resale value before purchasing, and that when unable to return an item online, 93% of our U.S. users would sell it online,” it added. Plus, the “online U.S. resale market for apparel and footwear is estimated to have been $7 billion in 2019 and is expected to grow to an estimated $26 billion in 2023,” it said, pointing to research it commissioned with GlobalData earlier this year.

Although the coronavirus pandemic affected Poshmark’s GMV, which measures the total dollar value of merchandise sold online, the metric gained ground as buyers and sellers resumed transactions following the initial outbreak. This year, GMV growth for the quarter ended March 31 was 9 percent but rebounded to 42 percent for the second quarter June 30. While it has benefited from stay-at-home orders as consumers shifted their purchasing to online, Poshmark cautioned that the pandemic “has impacted, and will continue to impact, our business.”

For its IPO, Poshmark plans to sell $100 million worth of shares, the typical placeholder by companies figuring out filing fees. Shares will trade on the Nasdaq under the symbol “POSH.”

The company said it posted its first quarter of profitability for the period ended June 30, which saw net income of $8.1 million, or 45 cents a share. For the nine months, revenue rose 28.1 percent to $192.8 million from $150.5 million, while it posted a net profit of $20.9 million, against a net loss of $33.9 million in the year-ago period. For the year ended Dec. 31, 2019, the company widened its net loss to $48.69 million from the year ago net loss of $14.5 million.

Poshmark charges a fee of 20 percent of the final price for sales over $15, or a flat rate of $2.95 for sales under $15.

As of Sept. 30, the peer-to-peer platform featured “over 201 million secondhand and new items for sale across 9,431 brands,” with “31.7 million active users, 6.2 million active buyers and 4.5 million active sellers,” it said.

Riaz Haq said...

Galaxy Rags ,Boys Clothing ,Pakistan

https://www.company-list.org/galaxy_rags.html

Company Introduction
WE ARE A GRADING & SORTING COMPANY OF USED CLOTHING & SHOESBASED IN KARACHI EXPORT PROCESSING ZONE IN PAKISTAN.WE ARE IMPORTING ALL OUR MIXED RAGS FROM USA AND THENPROCESSING AT OUR FACTORY THEN SHIPPING TO AFRICA.ALL ENQUIRIES ARE MOST WELCOME. WE ARE INTERESTED IN COVERING MOREAFRIACN MARKETS.


https://youtu.be/AUzlEhVbt3o

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Because of coronavirus, Europe is drowning in second-hand clothes
There’s pressure on the EU to help stop lockdown cast-offs from going to waste.


https://www.politico.eu/article/coronavirus-europe-drowning-second-hand-clothes/

Selling clothing that is reusable abroad often helps sorting companies break even. Of the 16 million tons of waste the EU textile industry generates per year, globally only 1 percent is recycled back into new garments — 50 percent is shipped to poorer countries, where it’s sold on local markets.

Since the COVID-19 pandemic began, exporters have cut their prices in a bid to shift stock. “The risks right now are much higher than the opportunities,” said Martin Böschen, head of the textiles division of the Bureau of International Recycling.

While recent months had brought some improvement in demand, prices are still “15 to 25 percent lower than before COVID-19,” said Böschen.

Gebetex exports around 40 percent of its reusable clothes and textiles outside the EU. “Regardless of the continents, the border closures simply blocked exports,” said Bourgeois, citing particular difficulties for shipments to Pakistan and India.