Wednesday marked the final day of the academic year for teachers, and after attending our luncheon, I decided to revisit my hunting/scouting days. I ventured to one of my secret spots in Glen Burnie, Maryland. During my last visit, I managed to find belts for $4.98 each, which I’ve been reselling for $40 a pop. This location used to be my go-to destination for sneaker deals, but footwear is no longer my primary investment focus – I’ll explain why shortly. What began as a quest for items to flip soon turned into an opportunity to analyze the current state of sneaker resale and retail.
As I entered the store, I couldn’t help but recall the words from an article I wrote just a few days ago. It was a piece discussing how counterfeit sneakers were pushing the sneaker resale market further into the abyss. If you haven’t had the chance to read that post, I highly recommend doing so. Now let me share my observations from the store visit.
Over 50% of the shelves were filled with Nike sneakers, with a majority of them discounted at up to 40% below their retail price. Upon closer inspection, it became apparent that the store was attempting to use third-party marketplaces, particularly StockX, as a reference for pricing their items.
The Air Force 1 Low Lemon Wash, pictured above, never had a specific release date and originally retailed for $100. Its current average asking price on StockX is around $59, which clearly demonstrates what stores are attempting to do. They aim to stay competitive by using third-party marketplaces as a benchmark for pricing their products. Due to the high volume of buyers attracted by online sales, brick-and-mortar stores find themselves in a challenging position, leaving them with no choice but to succumb to the pressure and lower their prices.
The Lack Of Gravitas
The sneaker market is currently facing a significant issue: an overwhelming influx of new releases, dropping at an unprecedented pace. This rapid saturation has resulted in a lack of backstory for each product, diminishing the gravitas that once made sneakers so captivating. The power of a compelling narrative cannot be underestimated, as it plays a crucial role in connecting with consumers and elevating a sneaker’s status.
Consider the recent release of 27 different sneakers since June 1st ( and we’re only on June 9th) – a prime example of this issue. The sheer volume of new products has left little room for meaningful backstories, ultimately failing to resonate with consumers and create lasting connections. In the past, people wanted to ” Be Like Mike” and Jordan signature shoes, Retros included were packed with meaningful stories of MJ’s lucrative career, and that became the catalyst to shoes flying off retailers’ shelves. Similarly, if we examine Steph Curry’s original sneaker series, each release was infused with a captivating narrative that resonated deeply with consumers. The underdog theme, in particular, played a significant role in driving their appeal and success.
When faced with a high volume of sneaker releases that lack meaningful narratives, the outcome is quite predictable – the sneakers end up collecting dust on retailers’ shelves and are soon marked down. And to make matters worse, many of these shoes are available below their retail price even before their official release, inevitably dragging the resale market downward. Furthermore, when a shoe is discounted by up to 40% off its original price, this sale price essentially becomes the new retail price, rendering the product far less attractive to potential resellers.
Do not Attempt To Resell General Release Sneakers
If you’re a Reseller betting on General Release sneakers to make a buck, it’s time to hang up the gloves and find a new hustle. Let me just go through some of the sneakers I came across to prove my point. Before I do that, I want you to quickly watch the video below
Let’s take the Nike Air More Uptempo as another example, a model I’ve been suggesting for the past two years that Nike should retire. In just the last month, the brand has released nearly 20 colorways, none of which have a discernible backstory. In fact, Nike has introduced a new version with an oversized swoosh on the panels (dubbed the “Copy and Paste Edition”), resulting in a Frankenstein-esque appearance and a major letdown. If we examine the white and black colorway featured in the video, it’s currently on sale for $99, while its resale value on third-party marketplaces is $111, accompanied by an 18% volatility (above normal).
At $111, resellers face a $5 loss – not disastrous, but still a loss considering the shoe is already discounted. For day traders in the sneaker market, this is undoubtedly a poor time for business. Furthermore, I would argue that even for those considering long-term sneaker investments, the current climate is far from ideal.
I acquired the Air Jordan 6 Bordeaux and the Jordan 13 Red Flint over a year ago, and even now, I would incur a significant loss if I were to sell them. My point is that retaining shoes for an extended period often results in minimal profits, no profit at all, or continued losses. This is due to the vast selection available and the relentless pace at which brands release new sneakers. Consequently, the concept of holding and reselling footwear may soon become obsolete.
The Lack Of Knowledge
A few years ago, I would have eagerly purchased many of the shoes in the video without needing to look them up, as they were well-known and held sentimental value. Nowadays, I find myself typing in the style code just to identify the shoe’s name – that alone is a major factor contributing to the struggle faced by retailers since even resellers are uncertain about the products they are selling.
This absence of depth is not only detrimental to the resale market but also has a negative impact on retail. Unfortunately, it appears that many brand especially Nike remain unconcerned. They continue to churn out sneakers, seemingly without implementing any checks and balances to address this issue.
This will likely be my final discussion on the current stagnant state of the sneaker resale and retail markets. The issue affects not only minor retailers but also major ones, such as Foot Locker, which must adapt or risk closing numerous brick-and-mortar locations. The photo below was taken during a visit to my local Foot Locker, where the wall is overwhelmingly dominated by Nike shoes, many of which are on sale and still unsold.
Chris Burns highlighted the golden opportunity smaller brands have amidst this situation. Now is the perfect time for them to make their mark, and some are indeed seizing this chance. Consumers are increasingly seeking gravitas and functionality, and it may be these smaller brands that drive significant change in both the resale and retail markets.
Interestingly, counterfeit sneakers, like the Air Kiy’s, have resale values surpassing their authentic counterparts by more than 50%. I previously wrote a post about this phenomenon, which can be found via the link below.