Tag: economics

How to determine the resale value on vinted?

Posted on by AnnJoest in Business-Sustainability

If you are just as annoyed about not being able to resell or frustrated why reselling takes such a long time, completely new to it, then this blog post is for you. With a background in business and econmics with a touch of psychology, I listed a few questions to think about before and during resale. They won’t help you determine how much to resell something for, but they will make you aware of different factors to help you determine the resell price for you, or to resell more effectively and maybe not, where it might be too time consuming;

Does every product resell the same?

Reselling at a higher price is often easier, when the market size is small. It means that there are only a limited set of goods available. If the interest to purchase such product is higher then the supply, than it is more likely that you can resell your product at a higher price. A secondhand Porsche tends to resell at a higher price then a secondhand car of a car brand that is largely available and affordable to most people. A jacket that is high in demand, but not available on the secondhandmarket (yet), or in very small quantities will likely resell at a higher price then a jacket of which (secondhand) markets are saturated on.

Do new products resale at a high price?

Even if your jacket is new and the market is saturated, it will likely resell at a lower price, because of market saturation. A related difficulty is that you will likely also find jackets, that are less worn but categorized as “like new”. This increases the total quantity of the “same jackets” and reduces their total value, because too many jackets of the same or a similiar model are available. Of course, if your jacket is new, it likely will resell higher, then if it is not, but the question is “if” and when. Another thought is to not resell it as high as the initial purchasing price as long is it is on the market, because it likely leads to people buying the new product from the store. That is because they are “brand new”. Even if your item is brand new, it is not, because you owned it already. Likewise, if the market is less saturated, you are likely to resell at a high price.

What if the market is saturated and my clothes are already worn?

That tends to be a bummer. You likely succeed in quick resale if you resell at a much lower price, then the average. The price has to be much lower, because then you are more competative towards higher priced and used products. It will make reselling a bit faster, but also runs risk of losing profits. On the other hand, it more likely leads you to making profits that you otherwise run risk of not making, because your average priced item will perish in the saturated market and the fact that new items are uploaded frequently on resale platforms. This may also work the opposite, by selling higher then the average. Reselling at a higher price likely means that more demands on the product exists, so reselling authentically is important.

We tend to be a bit greedy and are easier willing to pay a lower price faster, or higher for something being more unique.

How does product authenticity relate to resale value?

Each of us is different, which means that people will have different tastes, budgets and body sizes. It means that the more real a picture and related description feels like, the more real it will feel to the person interested in the product; what a consumer expects from a product by looking at its description should match the reality after purchase most likely. That can happen through the right colors representation, description of lenght and width, material features, deffects and pictures taken while worn with body in “normal poses”. In buying decisions, this likely leads to higher levels of confidence and a greater interest in paying a higher or “the” price for a product.

Isn’t it that some products don’t resell, if I am being that authentic?

Its not like that because again different people have different interests, budgets, body sizes and demands. It means that in different market segments, different customers can be found. Someone with a low budget, but eager to buy product x may buy a semi broken item, but repairs it and someone with a higher budget will buy the same product in a better or even new condition. Or maybe you want to try out a new style. Because it is new to you, it is not new to others and you find many products in a different market segments. In other words “there are different segments of popularity”, or “authenticity” that resale at a different price.

The more “real” your product is described, the more it will match the consumer reality and the more both of you will be satsified.

Should I use words like pretty or beautiful jeans for authentic resale?

I find that we are saturated on products and we often tend to forget, why we buy them. For example, shoes are there to protect our feet and jackets may keep us warm. Many of these qualities are often not listed, but instead descriptions such as “pretty”. While these descriptions are not wrong, they are subjective to individual perception, meaning your pretty might not be mine, but your waterprotection likely is mine. So, what are you selling? Highlight that and match your price accordingly. For example, it is rare to find waterproof raincoats. Ironic, right? But it sells, even if the brand is a bit less known.

Can brand names help me sell higher?

It depends again on the market and its saturation. If the brand name is so little known, it may take some time to resell high, a bit like in the example of the Porsche. On the other hand, a high new instoor purchasing price from a well known brand, likely keeps the average price in the resale market higher. For example, you will more likely sell product X from brand Y, with an instore price of 200€ at around 175€ new then product K from brand B with an instore price of 20€. So it’s a bit of a mix and you can have a look how your competitors set prices for similiar product categories, but also have a look at the current store prices. Ideally, you could be a bit lower, but not too low and not too high, but again depending on product quality, brand image etc.

Hope you liked this! If you have questions or comments, drop a message or leave a message in the comment section.

contact me for inquiries

How can external costs of consumption be equated with external costs of production? – An economic-psychoanalytical perspective

Posted on by AnnJoest in Uncategorized

The traditional business model equates production costs with revenues and therefore measures success based on the profits created. In doing so, most business models neglect their external costs of production. These are costs that relate to pollution or other forms of destruction and are often not accounted for. Business models that do not account for these external costs of production, likely run risk of market failure in the long term. A consequence is that neither business, nor planet, nor consumer will benefit in the future.

Increases in production come at an expense of
resources and well-being that is worth
more than the products produced. It also
implies that an undesirable balance of
quantities known as utility and disutility
occur. Utility is the level of satisfaction of the population’s needs and wants. Disutility refers to the sacrifices made necessary by increasing production and consumption, such as labor, loss of leisure, depletion of resources, exposure to pollution (Daly, 1990)

External cost of consumption?

Climate change and also climate awarness have been increasing steadily, particular since Fridays for Future. “We must act now, our planet is on fire, system change is needed” are some of the phrases that cover media. While these phrases demand companies, governments to change systems, they externalize individual repsonsibility and hence individual and collective cost of consumption. These are cost produced because of a (subconcious) desire for consumption and lifestyle choices. Because of that system change as demanded now, misses a sustainable point of view. That is a view in which “external cost of consumption” need to be internalized by consumers.

How can external costs of production be internalized?

Businesses can transition towards more sustainable business models and because of that reduce their external costs of production. That can happen if unsustainable materials are swopped with more sustainable materials (think about a plastic straw being swapped with a bamboo straw), if a company promotes the re-use of products or offers recycling opportunities (and so much more). However, swopping one thing with the other, or continue producing at the same speed, does not necessarily lead to more sustainable business models. Instead current production problems shift to other production processes. Because of that, long term business sustainabiltiy might fail.

For sustainable business models to take place in the long term, the role of consumers, the way they engage, behave and hence, want to purchase or not and how needs to change as well.

What are external costs of consumption and how can they be internalized?

Humans aren’t static. Humans like other species evolve and adjust to changes. “Survival of the fittest” – in evolutionary terms. If adoption does not occur, the survival of a species is at risk. To adopt and to change, we adjust, we make ourselves appeal to others by creating images, to become part of a group, to subconciously influence our own survival. However, much of such behaviours , think about dressing a certain way, or looking a certain way to be accepted by a group, does not relate to survival anymore – it is instinctional and therefore (unconciously) culturally influenced. Such behaviours therefore stimulate external costs of consumption [Evolutionary desire for change and adaptation, while such a change and adaptation is not need but rather socially constructed path-dependent]

External costs of consumption can hence be internalized, if individual and collective awarness increases towards unconcious behaviour and lifestyles. Where does a constant desire for changes deprive from? What purpose does a change fullfill? Who is this change done for? Who does one desire to desire back and because of that adjust towards a certain lifestyle , look or behaviour and therefore changes? What meaning do changes in choices have? Where should subconcious evolutionary need for change and adoptation stop? Where is the point of maximum utility for happiness reached and hence, the possibility to create an equilibrium between internalized external costs of consumption and production?

Do we need hair dye to impress others? Do we need new phones to take better pictures? Do we need make up? For who? Who are we, when we don’t change who we are or appear to be?

References

Campbell, A. (2000). Cultural identity as a social construct. Intercultural Education, 11(1), 31-39.

Graham, C. (2005). The economics of happiness. World economics, 6(3), 41-55.

Harte, M. J. (1995). Ecology, sustainability, and environment as capital. Ecological economics, 15(2), 157-164.

Hedman, J., & Kalling, T. (2003). The business model concept: theoretical underpinnings and empirical illustrations. European journal of information systems, 12(1), 49-59.

Hollan, D. (2000). Constructivist models of mind, contemporary psychoanalysis, and the development of culture theory. American Anthropologist, 102(3), 538-550.

Lüdeke-Freund, F., Carroux, S., Joyce, A., Massa, L., & Breuer, H. (2018). The sustainable business model pattern taxonomy—45 patterns to support sustainability-oriented business model innovation. Sustainable Production and Consumption, 15, 145-162.

Thompson, S. A., & Loveland, J. M. (2015). Integrating identity and consumption: An identity investment theory. Journal of Marketing Theory and Practice, 23(3), 235-253.