Let’s revisit July to get a better grasp on how August shaped up. July had a lot of Dunks. August, I didn’t win hardly any raffles so the number of Air Jordan 1 and Dunks decreased. Here is what I wrote for July:
The Average Resale Price in July on StockX was $129.68. This number blows away previous resale averages which hovered between 98 and 107 dollars.
My average price this month: 45,196/382 = 118.31. That’s not as high as the previous month, but is considerably more than previous months. There weren’t any other brands sold in August. This allows for some important information for retailers who are dependent on Nike, but still in the cross-hairs of possibly losing an account. It’s also a major commentary on why resale is slowing down considerably, while sneaker culture is growing more mainstream.
How can I say Resale is Slowing Down?
If I write these articles from my data, and I continue to state that sneaker culture is growing and mainstream, it should be reasonable to make a you statement that resale should follow the growth of sneaker culture right? I don’t think so. Resale follows the availability of footwear at retail. Not everyone lives near a Factory or Clearance Outlet. According to Statista, there are 234 Nike stores in the U.S; most of those stores in major cities. This means the inventory available to hit resale must come from Nike accounts. Several factors are limiting the number of shoes available at retail:
- Digital Raffle Systems have effectively wiped out a lot of the backdooring that happened in the past.
- Covid-19 has slowed shipping to a crawl and the stores don’t have a lot of inventory. The shoes that are hyped are raffled. Shoes that aren’t hyped, don’t require promotional enticements for the consumer since there aren’t many options.
- Because the options are limited, arbitrage is no longer a possibility. Furthermore, Nike itself is now a part of the resale system with Nike Refurbished.
- More sellers vying for the hyped shoes means new sellers aren’t able to mix risk and guarantees. This is the most important aspect of how more people being involved in sneaker culture hasn’t equated to more resale. The limited amount of shoes available forces a new seller to rely solely on a guaranteed win. This means there are fewer sellers entering the business, and by default fewer shoes are being resold.
A key topic of discussion that is often overlooked, take a shoe like the Air Jordan 1 Retro High OG Trophy Room. The number of shoes made was reported to be 10,000 pair. On StockX the shoe has been resold 1,740 times. On eBay 234 pair have been sold. This would be a fair number of shoes entering the resale market, but no one accounts for how many times the same pair has been resold. THIS CONVO IS ALWAYS OVERLOOKED. All people see is the inflated ‘sold for’ price and they think that all shoes have this type of value. The reality in resale has always been the ability for a person to walk into any retail outlet and work via arbitrage, or to be able to by off the shelf and flip for maybe a 20-50 dollar profit.
You cannot walk into a retail outlet right now and buy shoes to flip, you can, but it would take a lot of detailed research to guess which pairs to buy and hold. I visit at least 5 stores a week and every Nike account has tiny sections for other brands and duplicates on the wall of Nike and Jordan. Does this diminish resale for a company like StockX? No. StockX has insulated itself as I stated earlier. They have made it possible to immediately sell even the cheapest shoe. Most people overlook the models that can bring them a consistent 10 dollars. For a seller on eBay, holding for ten dollars isn’t feasible.
The number of resellers is decreasing and the power in resale has shifted altogether to cook groups and bots. My 118.00 average consisted of 246 of the 382 pair sold at 118 and under. Those were shoes I bought from my buyers/consignment team and sold immediately on StockX. Would I have been able to do this by keeping inventory and using Amazon or eBay? September is a good gauge to measure this as I’ve decided this month to hold certain shoes. I’ll be able to report on Amazon from September. The question is should I attempt to do this with eBay?
On to Part 4
