How sneaker reselling went from niche collecting to mainstream fashion _ financial post

MONTREAL — Toddy Flores’ journey to buying and selling sneakers began like most of his fellow enthusiasts: as a teenager who finally had the financial independence to afford shoes that weren’t picked out by his parents.

The 43-year-old Montrealer said he first realized his interest in sneakers went above and beyond the norm while on a week-long trip to Chicago for a basketball tournament in 1989. Low cost high profit business in india The all-black Air Jordan 4s were being released in the U.S. What products have high profit margins that weekend and with his $400 trip budget Flores bought not one but two US$99 pairs knowing the shoes could become rare once they sold out.

Flores soon realized that sneakers could be a passion, but also an investment, using the cash collected through his work as a professional DJ. Small business with low investment and high profit in india Although he doesn’t know exactly how much money he’s made over the years, he said it has helped him pay for his wedding, cars and his first condo.

“I’m passionate about it, I love them and I see them as pieces of art, but at the same time they have value, and I saw them as something that could be profitable,” he said.

The sneaker reselling market has grown from a niche interest into an industry worth an estimated US$1.2 billion per year in the U.S. Small business with high profit margin alone, fuelled by celebrity culture and made more accessible through the Internet and social media.

Sneaker culture received some of its first publicity in the late 1980s with stories about U.S. Companies with high profit margins inner-city youth being murdered for their shoes — particularly, the coveted Nike Air Jordans — famously highlighted in the 1990 Sports Illustrated cover story, “Your Sneakers or Your Life.”

Although the industry is still heavily focused on young people, it has drifted to the mainstream as consumers have aged and started making more money. High profit items to resell Sneakers produced in limited runs have now become highly coveted luxury items that can be sold for many times their retail value on the secondary market.

“You see people wearing sneakers more a little liberally with suits and it trickles down,” said Marc Richardson, a manager who heads online retail at Off The Hook, a clothing store and sneaker retailer in Montreal. Small business with low investment and high profit “If sneakers are more socially acceptable attire, I can justify spending twice as much.”

To get an idea of the resale value, the right model of Yeezys — the Kanye West-Adidas collaboration — can retail for $300 and resell for more than $1,000.

Flores once owned close to 1,400 pairs of sneakers, but decided last year it might be time to downsize his collection when had to make two trips with the moving van for his sneakers alone after he bought a new house. Small business high profit in india He also doesn’t have as much time to devote to his passion, given that he’s a DJ, owns a restaurant and wants to spend time with his family.

But with about 900 boxes of sneakers still crowding out the living space in his finished basement, he said he would be happy to sell most of them and just hold onto the ones he really loves — a modest 150 pairs.

How resellers get their hands on sneakers varies from person to person. High profit margin Flores said he’s developed a network of collectors and store managers during the past 25 years to help get the shoes he’s looking for.

Those without Flores’ connection have to find other ways to get their hands on the rarest sneakers, including camping out in front of stores for hours, sometimes days ahead of a release.

Others, such as University of Ottawa student Elliott Klein, make extensive use of the Internet. High profit service business He said anyone who treats it as a business can’t just rely on online retail checkouts to get a pair of sneakers that are being sought after by thousands of people — both buyers and resellers.

Competition is so intense that Klein uses computer programs called bots to automatically select the size and process an order in 10 to 20 seconds, shaving off just a little bit of time from the 30 seconds it might take for a human to do it.

“Bots themselves aren’t super complicated, but the reason that casual fans can’t get pairs for themselves is that a bot alone isn’t enough anymore,” he said

Klein said serious resellers now rent temporary servers that have high Internet speeds to run the bots, and have access to multiple credit cards, IP addresses and physical addresses to ship, because some companies cancel orders if they notice multiple pairs are being sent to the same person.

There are also regular conventions in most major North American cities where collectors can display their shoes to sell or trade. Low investment high profit business in delhi Flores said he’ll be attending one called Sneak Peak MTL early next year, and adds that the social and community aspect of these events is just as important as the profit.

Selling on the Internet — eBay is an obvious way as it’s an online auction — creates problems when it comes to authentication. Low cost business ideas with high profit in india Buyers are left on their own to figure out who the sellers are and their reputations. High profit business in india People who feel they have been scammed are left to resolve conflicts with PayPal on their own.

For example, a judge in October ordered eBay to pay two Montreal brothers more than $86,000 after it took down their advertisement for a pair of highly prized Nike sneakers because the online auction giant claimed the first-time seller’s listing looked like a fake.

In the past few years, there has been a migration away from eBay to social media sites such as Facebook where online communities can self-police through reputations gained by buyers and sellers, though this doesn’t solve the problem of authenticating products.

Former IBM Corp. Low cost high profit consultant Josh Luber believes he has come up with solution. Items with high profit margins In 2010, he combined his loves for sneakers and data analysis to create Campless, a company that collects, analyzes and publishes data and derived insight related to the industry. High profit home business And in February 2016, he and Cleveland Cavaliers owner Dan Gilbert launched StockX, which functions like a stock market for sneakers.

Sellers on StockX list the price they are willing to sell their sneakers for, while buyers post the amount they want to pay. Small scale business with high profit in india When a price is matched, the seller ships the shoes to StockX, which makes sure it is the real product and sends it along to the buyer.

“If you buy a share of Apple stock on the New York Stock Exchange, there’s a real seller on the other end of that specific trade, but you don’t know who that is and you don’t care,” Luber said. High profit online business “All you care about is the price you paid for it and you know it’s real.”

The relationship between resellers and sneaker enthusiasts is a complicated one, but there is a wide spectrum of those who collect for the passion and those trying to turn a profit.

“Although I am a reseller, I actually want to give to the real sneaker fanatics a chance to get the sneaker,” said Flores, adding that because of his connections, the shoes he buys do not affect local store allocations.

Klein, as someone who loves sneakers, said he has thought about the ethics of inflating prices through reselling, though he sees it as different than, say, concert scalpers who are limiting access to an experience, as opposed to a product.

Some retailers take measures to level the playing field by having raffles for sneaker releases to discourage resellers who have the time most don’t to camp out in front of stores.

Richardson at Off The Hook said it is working with Ottawa-based e-commerce platform Shopify Inc. High profit products to sell online to create programming that can block bots. High profit industries But these measures haven’t been successful as the bot programmers always find a way to stay one step ahead.

“It’s not a good thing that people are reselling,” Richardson said. Small business with high profit “But it means there is a value to the product if people are willing to pay double, triple the price sometimes to get the shoes that they want.”

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