New research suggests the resale value of unused goods in Australian households could equate to more than $40 billion, highlighting opportunities for start-ups in the growing second-hand market.
According to the research, conducted by classifieds website Gumtree, Australia’s second-hand economy grew from $13 billion last year to almost $18 billion this year – a rise of almost 40%.
Over the last year, Gumtree.com reported its sales grew 143%. According to Gumtree spokesperson Nat Thomas, the most popular items sold are books, clothing and electronics.
The report estimates there are 23 unused items in each household across the country, while one in five homes have at least 40 items they don’t use or want.
According to the report, the resale value of these unwanted and unused goods could equate to nearly $44 billion.
Thomas told AAP the surge in the second-hand economy is “a reaction to the tougher economic times we find ourselves in”.
“People are selling everything from property to cars to business services, fashion – anything you no longer have a need for,” he said.
Marco Ferlaino, of award-winning start-up RemoveMe, says the figures from Gumtree reaffirm the demand for his offering.
“Our simple philosophy is what happens to all the unsold stuff on eBay? That’s our market,” Ferlaino told StartupSmart.
“Essentially, we’re interested in the tens of millions of items every day that end with no bids.”
Anyone who wants to get rid of unwanted goods can contact RemoveMe – described as “FedEx in reverse” – which takes the goods away and recycles them.
Ferlaino says his business is no different to any other internet start-up in that it provides a new approach to an old problem. But he insists he’s not concerned about competitors.
“For us, we are working extremely hard creating a defensible advantage. 99.99% of everything we do is working on what our value proposition is,” he says.
“We’ve got our vision and [competitors] can only copy a certain snapshot of that.”
Initially, RemoveMe will only operate in a handful of suburbs, Ferlaino says.
“[This will enable us] to get feedback from the customer to see what they like, what they don’t like… and then extend it to little bit of radio advertising I guess, which gives us a broader [scope],” he says.
But rather than rejoice over consumers’ cost-conscious behaviour, Ferlaino says he prefers to see strong retail figures.
“We want Harvey Norman and every major retailer in Australia to make trillions,” he says.
“Because for every item that’s bought or exchanged, someone has to make room for something that is no longer needed.”