Our clients quiet often ask what type of clothing is the most profitable to resell and the differences between second hand cream (creme) clothing and original unsorted collection. First of all, all second hand clothing is divided into two types: clothing sorted in regards to quality and/or type – Sorted/Graded mix; or clothing in its original form, collected from local community – Original unsorted collection. Let’s see the differences, shall we.
Please note: all the figures mentioned below represent European market only. If you trade in Africa or Asia for example, it might work out differently for you. But, again, if you trade in Africa, you wouldn’t buy the Original unsorted clothing, would you? You would need Sorted, summer grade clothing!
Where does second hand Cream (Creme) and the Original clothing come from?
Original unsorted collection. This is clothing that was collected by charity organisations or recycling companies with the purpose of selling these clothes outside of the UK. There are two main types of Original unsorted clothing:
- Door to Door collection. The clothing and shoes are collected locally at people’s homes.
- Textile banks (Textile container collection). The clothing donated via textile banks/containers in shopping or recycling centres.
In both, Door to Door and Textile banks collection, you would find untouched original clothing that can be of excellent quality as well as full of unsaleable textile waste.
On average, the percentage of waste is 30-40% for Door to Door collection and 40-50% for the Textile banks collection.
Sorted second hand clothing. As a rule, you already know what you are buying, clothes are selected either by season or by gender or by quality:
- Season (can be summer or winter mix or summer and winter items in one mix)
- Gender (Ladies, Mens and Kids clothing)
- Quality (Cream, Grade A, Grade B/C/D). The best quality would be Cream and Grade A mix, the lowest quality is Grade C/D.
How to choose the Grade?
The difference between Sorted, let’s say as an example Grade Cream/A and Original unsorted used clothing is the price and the quality you get for your money. Don’t get me wrong, I’m not saying that the Original unsorted clothing is better than Grade Cream/A because it’s very cheap. And I’m not saying that Grade Cream/A is better than the Original unsorted clothing because it has more quality in it either. Each category has its own advantages.
To begin with, you should determine the desired product for your store. What type of clothes do your customers most want to buy and at what price? If you need the entire range, from household goods to books, hats, underwear and shoes and all this in a small volume then you should go after the Original collection. But just keep in mind, there are categories of clothing that are constantly in demand, they will provide you a turnover and will be sold in a matter of days or even hours. These are a good quality children’s clothing and shoes, bright and trendy women’s clothes and quality men’s wear.
And now imagine, you bought 1,000 kg of the Original unsorted clothing. You’ve put this product on your shelves and hangers; it is on display now. In two days you sell 20% of the supply, it is 200 kg and you think wow, happy days, I’m gonna sell the rest 800 kg in 8 days, right? WRONG!
Let’s see what’s happening in reality.
Believe it or not, about 30 – 40% of Original unsorted clothes are unsaleable items and represent a textile waste. From the remaining 60 – 70% you have around 15 – 20% of really interesting and pretty good items. Please remember, the original clothing mix contains about 25% kid’s, 25 – 30% men’s and 45 – 50% ladies clothing.
In reality, it turns out that in your first two days you have sold the most interesting items (Grade Cream/Grade A), which was 20%. In coming days/weeks people will still purchase some men’s and kid’s clothing, which is always popular no matter what. However, 40% of clothing have already gone into the textile waste, we’ve talked about it earlier, and now you have unpopular ladies, men’s and household items that you cannot sell. On average, it would be around 20% of items that you just cannot sell. You really don’t want to offer the same items at your shop over and over again. You have to refresh your stock, otherwise your customers would get bored and stop coming into your store.
What do you do next? Well, if you managed to return the money you’ve invested from the sale of 20% of Grade Cream/Grade A clothing, then the rest of sales is your profit, your next 20 – 30% of the goods sold.
What do I do next?
You make a new purchase, you buy another 1,000 kg and then another 1,000 kg, etc. After five purchases, you will have about 1,000-1,200 kg of unsaleable goods in your storage.
Do you have a good size storage space? Will you have the right customer for your unsold/unsaleable product so you could sell it wholesale? After all, the risk of you not be able to sell this stock is really high.
If you have a chain of large shops (20+ shops) with high footfall; you see pensioners, children, teenagers, men, women and you need a lot of different goods, like household textiles, shoes and underwear, then take the Original unsorted clothing, fill the shelves with clothing! Any required/popular grades can be purchase separately and any unsold inventory can be loaded into shipping containers and sold as Grade C/D abroad.
For smaller retail networks, for obvious reasons, we recommend taking second hand sorted clothing, Grade Cream and Grade A. This is the best price/quality combination. You can get the season you need and the quality you want! Yes, the Grade Cream and Grade A clothes have a slightly higher cost than the original, however, you are 100% sure that you get what your customers need. The Grade Cream and Grade A mixed clothes come from high quality Original clothing, the only HUGE difference is that every single item will be checked/selected for quality. There will be no rubbish, no textile waste, no ripped, stained, wet or damaged items. There will be no household textiles, socks or underwear.
The cost of Transportation
The other reason to consider, when choosing between Grade Cream or Original used clothing is the cost of transportation. If you take a 100 kg, it wouldn’t make much difference. However, if you need 20,000 kg then transportation costs could play a major role. Just think about it for a moment. Let’s say, as an example, the cost to deliver 20,000 kg from the UK to your country is £2,000. If you buy the Original clothing and 50% of that clothing will go to textile waste then you have just wasted £1,000 to deliver the unsaleable clothing and textile waste to your shop/warehouse. Not to mention customs clearance fees if you had to pay those too.
We encourage you to read the rest of our articles about second hand clothing business. Good luck!