Western brands under pressure as 'pre-owned' luxury booms in China

Pre-owned luxury refers to luxury goods that someone has owned before and then resells. Buying brand-new means purchasing directly from a brand or retailer, usually at the original retail price. The difference matters because secondhand shopping can make prestigious products more affordable and extend their commercial life.

At Shanghai’s Super Zhuanzhuan, shoppers browse previously owned handbags, belts and jewellery in a warehouse-style store. They compare who found the better deal, rather than who spent the most. The store requires black gloves, showing how carefully resale goods are handled. The article does not explain its authentication process, but authentication is an important established part of trusted luxury resale.

This market is expanding while new luxury sales weaken. China’s secondhand luxury market grew 15 per cent to 20 per cent in 2025. That growth gives consumers more choice and pressures Western brands to remain desirable, distinctive and relevant beyond their traditional stores.

China’s new personal luxury market is shrinking, while resale is moving in the opposite direction. Bain & Company says the mainland market fell as much as 19 per cent in 2024, then contracted another 3 per cent to 5 per cent in 2025. This matters because Chinese consumers once generated around one-third of worldwide luxury spending.

The secondhand market grew 15 per cent to 20 per cent in 2025. Insight & Info Consulting estimates its total sales reached 38.4 billion yuan, or US$5.7 billion. It forecasts sales could exceed 100 billion yuan by 2030. Shoppers are choosing lower-cost ways to buy luxury as they tighten household spending.

The split is reshaping the industry. LVMH blamed weaker China demand for lower third-quarter organic sales in fashion and leather goods. Resale is not simply replacing every new purchase, but its rapid growth shows that luxury demand is changing in price, purpose and shopping channel.

Major Western brands face weaker demand as China’s economy struggles to recover from the pandemic. Consumers are tightening their budgets, buying secondhand goods or choosing upstart domestic brands. This matters because Chinese shoppers once accounted for around one-third of global luxury spending, making China central to the growth plans of companies such as LVMH and Hermes.

Louis Vuitton has closed five mainland China stores in two years, including a Shanghai chocolate boutique. Galeries Lafayette also shut its Beijing flagship in May. LVMH linked a third-quarter decline in organic fashion and leather goods sales to a slowdown in Chinese demand. Fewer stores can lower direct sales and reduce a brand’s physical visibility.

Closures also signal a relevance problem. Shoppers increasingly want identity, experience, quality and cultural connection, not status alone. If brands fail to adapt to China’s digital, social-media-driven market, they may lose attention and face reputational criticism, as LVMH did after its Molly Tea lawsuit.

Luxury buying in China is shifting from public status to personal meaning. Bank of America’s Chen Luo says shoppers increasingly value self-identity, distinction, experience, quality, emotional value and cultural relevance. This matters because the old idea that one famous logo automatically signals prestige is becoming less powerful, especially as consumers watch their spending.

Phoebe Ma, a 24-year-old freelancer, said Louis Vuitton’s monogram feels dated and suits her mother’s generation. She said Gen Z would rather buy trendy Korean brands. Her view shows how age and taste can change the meaning of a luxury symbol. A logo that once communicated achievement may no longer communicate individuality.

Digital and social media reinforce this change. China’s retail landscape is highly digital and has a unique online ecosystem, Luo said. Brands must therefore stay visible and culturally relevant in new spaces, not rely only on historic status. Economic recovery could help luxury spending rebound, but China may not be a growth engine soon.

Chinese fashion preferences are becoming more varied and less dominated by a small group of Western luxury names. Phoebe Ma said her mother’s generation knew only a handful of luxury brands and developed a deep impression that Louis Vuitton was the most prestigious. Younger shoppers do not necessarily share that hierarchy.

Ma said Louis Vuitton’s monogram feels dated and that Gen Z would rather buy trendy Korean brands. The wider article also describes consumers buying upstart new homegrown brands. Together, these choices broaden what can look fashionable or desirable in China. Trend, identity and cultural relevance can now compete with long-established Western status.

This does not mean Western brands have become irrelevant. Analysts still call China vital to global luxury. But brands must adapt to a digital, social-media-driven retail environment and changing expectations. If domestic and regional labels offer stronger cultural connection or better value, they can capture attention that once flowed automatically to famous Western logos.

Trademark protection helps a luxury company defend distinctive symbols from imitation. LVMH called its intellectual property an “absolute key asset,” so protecting its monogram-related designs can support brand control and commercial value. But legal ownership does not guarantee public approval, especially when a design has wider cultural associations.

LVMH successfully sued Chinese beverage chain Molly Tea over a four-petal floral pattern resembling its monogram. Chinese internet users and state media then pointed out that the motif shares roots with ancient Chinese traditional patterns. Some shoppers viewed the lawsuit as inappropriate because Molly Tea was a much smaller Chinese business.

The result was a reputational trade-off. LVMH protected its trademark, but management admitted the controversy had a negative impact. The case shows why enforcement must be understood in local cultural contexts. A lawsuit may deter copying while also making a global brand seem aggressive or disconnected from Chinese history and public sentiment.

The secondhand market creates value by keeping luxury goods in circulation after their first purchase. Owners can resell handbags, belts or jewellery instead of leaving them unused, while new buyers can obtain recognised products for less than the cost of buying new. This matters during an economic slowdown, when shoppers still want quality but are more careful with money.

At Super Zhuanzhuan in Shanghai, customers browse luxury items that are all secondhand. Dance teacher Yuan said people now compare who got a better deal and spent less. The store’s black-glove rule shows the products are treated as valuable goods. The article does not describe the store’s authentication system, but reliable authentication is an established mechanism that helps buyers trust resale products.

China’s market grew 15 per cent to 20 per cent in 2025 and reached an estimated 38.4 billion yuan. Its projected growth could pressure new-product sales while encouraging brands to consider resale as part of luxury’s future.