Entrepreneur

Second-Hand Luxury: This S'pore Startup Made $49.8M Sales In 2019 From Pre-Loved Hermes Bags

Navigating the secondhand luxury bag space has its challenges.

For privacy reasons, sellers often don’t want to be seen selling their designer bags. They may also find it too time-consuming to field questions from interested buyers, or to complete the transaction themselves.

On the other end of the spectrum, buyers are concerned if they’re getting the real deal or a cheap knock-off with their hard-earned money.

This is why people in the know head to luxury purveyor LuxLexicon, where they can sell and buy pre-loved Hermès handbags without any fuss.

Meet S’pore’s Largest Luxury Reseller Of Hermès Bags

Incorporated by Florence Low in 2016, LuxLexicon touts itself as Singapore’s largest luxury reseller of Hermès Birkin and Kelly handbags.

The business was first launched on Instagram in 2012 under the @luxlexicon handle, which has since garnered 55,900 followers (and counting). 

Florence started LuxLexicon after seeing the need for “a trusted platform”, where consignors could leave their expensive handbags behind without worries for them to sell on their behalf.

She stressed that her business puts a lot of emphasis on trust — in fact, they claim to be the only Hermès reseller that offers a money-back guarantee on authenticity.

LuxLexicon also prides itself on transparent pricing and makes it a point to clearly state the pricing of all items. This way, customers can expect how much to shell out if something catches their fancy.

luxlexicon hermes singapore
Image Credit: luxlexicon via Instagram

“We’re trying to remove any shadow of doubt as to how we handle the consignment and how much of the consignment proceeds [the consignor] gets from the sale,” said Florence.

Not every reseller is open with their prices, she shared, adding that some resellers prefer to ‘eyeball’ the potential customer and charge based on how much they think he or she can pay.

Four- And Five-Figure Bags Sold Within Minutes

LuxLexicon’s Instagram page is curated with photos of designer goods, which varies from handbags and wallets, to scarves and bracelets.

Their prices range from $300 for a silk scarf to $300,000 for a diamond Birkin bag, with the average ticket price being $14,000 in 2019.

Its Instagram page currently has over 1,000 posts — this excludes posts of sold items, which are promptly deleted after a customer makes full payment.

luxlexicon hermes singapore
Image credit: LuxLexicon

According to Florence, LuxLexicon takes a flat $1,000 cut from the consignment price for all Birkin and Kelly bags, which serves as the “dealer fee”.

She admits that each of LuxLexicon’s posts may not necessarily have a high number of ‘likes’ or comments because buyers don’t want to be seen publicly expressing their interest.

For that reason, LuxLexicon mainly interacts with buyers through messaging platform WhatsApp. Out of the business’ six full-time staff, three of them are dedicated to handling sales via WhatsApp.

Florence added that their bags tend to get sold quickly. Some are sold as early as within five minutes or a day of posting, while the “most challenging” bags, such as the bigger ones, get sold within six months.

luxlexicon hermes singapore
LuxLexicon store at The Centrepoint / Image Credit: LuxLexicon

After two years of transacting online, she realised that “relying on pictures alone isn’t going to cut it”. This prompted her to bring the business offline and invest approximately $2 million to open a flagship brick-and-mortar LuxLexicon store in The Centrepoint mall in 2018.

Florence said that the store’s purpose isn’t so much for people to window-shop, as most walk-in customers have already made up their mind on what they want to buy.

Instead, the store acts as a safe place for the completion of a sale. Besides doorstep delivery, customers can opt for self-pick up at the store for a chance to touch and feel the item before proceeding with the big-ticket purchase.

Bagging Sales Worth $49.7 Million In 2019

In 2019, LuxLexicon clocked a record $49.7 million in sales, marking a 46% growth from the previous year. This sales revenue was derived from 3,600 deals over the whole year, which equates to about 10 deals a day.

luxlexicon hermes singapore
Image Credit: LuxLexicon

Recounting her success, Florence said that getting a Birkin or Kelly bag from the original Hermès store is a “very political” game because you first need to go through six months of “profile building”.

This means that you have to spend tens of thousands of dollars on various Hermès peripherals, such as shoes, accessories, small leather goods and apparels, before you are deemed ‘worthy’ enough to buy a Birkin or Kelly.

Even then, you don’t have any say on the size, style or colour of the bag you can buy.

“[Hermès] basically gives you what it wants to give you,” revealed Florence.

So if you’re part of the instant gratification crowd and want to own a Birkin or Kelly without all this hassle, then an Hermès reseller like LuxLexicon serves as a great option.

The high sales volume LuxLexicon experienced last year is a testament to the viability of the business. 

Florence shared that when she first launched LuxLexicon, many were sceptical about it. “Naysayers” expressed doubts on whether customers would trust the authenticity of the bags, or whether they would even be open to buying from a reseller. Consignors too were unsure if their bags would be well taken care of while waiting to be sold.

However, LuxLexicon has successfully converted not just one, but two clients — the consignor and buyer — with every sold bag.

“People’s trust needs to be gained over time, one bag [at] a time,” said Florence.

“When I sell your bag and pay you promptly, you [will] feel that this service is reliable. It delivers […] and meets your expectations, so you’re going to come back to me next time.”

The Language Of Luxury

Locals make up about 70 per cent of LuxLexicon’s customer base, with the rest being made up of overseas shoppers.

Florence said that she has even encountered customers from as far as the United States, who make it a point to visit their store during their Singapore trip.

“They must have read about us, or heard [about us] from someone, or they could even have bought something from us [before] — and they feel that it is worthwhile to check out [our store],” she said.

“We’re just very humbled and privileged that [tourists] feel that it is worth their while to come down [to the store] even though they only have a very limited time to be holidaying in Singapore.”

To that end, LuxLexicon fans and customers may look forward to visiting a larger store in the future. Florence said she’s actively looking for a bigger retail space to scale the business’ presence since the current store size is “cramping [their] style”.

But if there’s one thing that will not change in time to come, it is LuxLexicon’s efforts to ensure consistency across all customer touch points.

For instance, LuxLexicon has been posting on its Instagram page daily for the past six to eight years. The key is to “be consistent [and] diligent,” she advised.

“Maintaining consistency gives people a sense of predictability and comfort in knowing what to expect when they deal with us. Through our consistent and diligent work, people have come to associate us with transparency [and] honesty.”

Featured Image Credit: LuxLexicon

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