Sneaker reselling has been a booming business for many years, but recent changes in the industry have left many wondering whether it's still a profitable venture. In this article, we'll take a closer look at the state of sneaker resale in 2023 and explore some of the challenges facing resellers.
The Current State of Sneaker Resale
Reselling sneakers has always been high-risk, high-reward. But with the current state of the market, it's becoming increasingly difficult for resellers to turn a profit. The COVID-19 pandemic has caused disruptions to supply chains, resulting in shortages of popular sneakers like the Nike Air Jordan 1 and Adidas Yeezy Boost 350. This, in turn, has driven up prices, making it harder for resellers to buy low and sell high.
Moreover, companies like Nike and Adidas have taken steps to combat reselling. Nike, for instance, has implemented a "SNKRS Pass" system that requires customers to enter a lottery to purchase limited edition sneakers. Adidas has also launched its own reservation system to prevent bots from scooping up all the inventory.
Those hurting the most are sneaker resellers who rely on a quick flip - reselling immediately after purchasing as a means of sustaining their reselling business. Let’s say the market isn’t ‘cooperating’ and these resellers typically don’t have the luxury of holding onto product and selling when the market rebounds.
The larger the sneaker reselling market grows, the more opportunities there are for counterfeiters to rip off the sneaker community. We’ve seen discrepancies touch even the most trusted marketplaces in the game such as StockX.
Read more on the StockX scandal and how to instill trust reselling amid the rise of fakes right here!
Another indicator of the sneaker market slowing down is when launch-day sneakers are still in stock for several days after their release, it is considered an indication of a more difficult resale market, and this is commonly referred to as "shoes sitting."
The Impact of Technology on Sneaker Resale in 2023
Advancements in technology have made it easier for resellers to acquire inventory, but they've also made it harder to compete. Bots and automation software can purchase sneakers faster than any human can, giving those who use them an unfair advantage. Additionally, social media has made it easier for resellers to market their products, but it's also created a saturated market where it's hard to stand out.
“You live by the bot, you die by the bot.”
Mike Packer, owner of the boutique sneaker store Packer Shoes in Teaneck, NJ
How will tech impact the sneaker market this year? One of the key ways technology is expected to affect the industry is through the use of artificial intelligence and machine learning.
AI-powered tools can help sneaker resellers accurately price and value their inventory, by analyzing data from past sales and current market trends. This can lead to more informed pricing decisions and better profitability for resellers.
When it comes to counterfeit sneakers in the market, blockchain technology, for example, can be used to create a secure and transparent record of a sneaker's authenticity, making it more difficult for counterfeiters to pass off fake sneakers as genuine.
Furthermore, mobile applications and online marketplaces are expected to continue to be a major driver of the sneaker resale industry, as consumers increasingly turn to these platforms to buy and sell their sneakers. These platforms can offer resellers a wider reach and greater convenience, while also making it easier for buyers to find the sneakers they are looking for. Goat, StockX, eBay, Grailed, and many more will be marketplaces to keep up with.
Check out our Ultimate Sneaker Reseller Cheat Sheet!
Ultimately technology has been both a blessing and curse for the sneaker reselling industry. With so many resellers hopping on the money train in recent years, the landscape is changing, and sneaker resellers need to be more strategic than ever.
The Future of Sneaker Resale
Despite the challenges facing the sneaker resale industry, there are still opportunities for resellers to make money. For instance, resellers can focus on buying and selling sneakers that are less in demand but still have a loyal fanbase. They can also differentiate themselves by offering better customer service, such as faster shipping or more lenient return policies.
The state of sneaker resale is in flux, and it's unclear what the future holds. However, resellers who are willing to adapt and differentiate themselves from the competition can still find success in the industry. By staying up-to-date on the latest trends and being mindful of the challenges they face, resellers can continue to make money from their passion for sneakers.
Despite the looming challenges, the sneaker reselling market is expected to reach a market size of $30 billion by 2025, according to a report by Cowen & Co. This growth can be attributed to several factors, including the continuing rise of streetwear fashion and the increasing popularity of limited-edition and exclusive sneakers. Overall, the sneaker reselling industry is expected to continue to thrive in 2023 and beyond.
Are you a sneaker reseller? You might be interested in 2023 Sneaker Trends: 10 Styles Guaranteed to Sell.