As secondhand luxury soars, authentication becomes a new gold standard

As the global market for secondhand luxury items surges, authentication has become the defining factor separating credible platforms from the rest.

The resale market for fashion and luxury items is expanding at an annual rate of 10%, three times faster than the firsthand market, according to a report released Oct. 9 by Boston Consulting Group and luxury resale platform Vestiaire Collective.

The report projects the global resale market could reach up to $360 billion by 2030, from about $210 billion today.

With more shoppers buying pre-owned designer brands, trust has become paramount. “As counterfeit manufacturing becomes increasingly sophisticated, even luxury brands themselves sometimes fail to detect fakes, in some cases, unknowingly repairing counterfeit items,” said Jaewha Choi, CEO of South Korean online marketplace Bunjang.

Horror stories abound online of people paying thousands for fake Hermès bags or a Rolex Oyster Perpetual watches with swapped parts. Some counterfeits are so convincing they are dubbed “superfakes,” reportedly made with materials from the same leather suppliers as the original brands.

Buyer beware

However, as the resale market expands, authentication has become a growing concern. The secondhand industry has long operated under the rule of “caveat emptor,” or buyer beware.

To counter increasingly realistic “superfakes,” resale platforms are pouring resources into verification. Singapore-based online marketplace Carousell opened its first brick-and-mortar store for luxury items in downtown Singapore this year, allowing sellers to have their items graded by one of the company’s appraisers before listing them for resale.

The verification team inspects not only the material of a bag but also details like stitching and stamping, Tresor Tan, Director of Sales, Marketing and Client Relations at Carousell Luxury, told CNBC.

“At the end of the day, it’s our reputation at stake as well,” Tan said. “And because of that confidence, we also offer our buyers a money-back guarantee on authenticity.”