“We’re finding more customers in the millennial age group are interested in secondhand clothing, rather than brand new, so we’re evolving our business model to actually resell the returns that we’re getting,” Sam Wood, Azura Fashion Group’s CEO, told Inside Retail.
Luxury’s discount problem
Azura Fashion Group was born out of the uproar caused by Burberry’s revelation in 2018 that it had destroyed millions of dollars worth of excess stock, rather than sell it at a discounted price, to protect its brand image.
While this is standard practice in the luxury fashion space, it’s not common knowledge among consumers, and many of them were outraged when they found out.
However, Wood saw an opportunity. Together with Tim Bloore, he launched Azura Fashion Group in 2019 to provide brands with an alternative way of dealing with excess stock.
The business sources end-of-line and off-season products from luxury brands, distributors and wholesalers and lists them on online marketplaces. It handles all the marketing, and if a product sells, it sends the supplier a shipping label and pays them a portion of the sale price.
“We built a model so brands could sell their products without having to discount heavily, while also being able to reach new markets that they aren’t currently in,” Wood explained.
At any given time, the business has over 1200 brands, such as Louis Vuitton, Gucci, Dolce & Gabbana, and over 380,000 products listed on 55 marketplaces in 17 countries. It also has logistics hubs in Australia, the UK, US, Netherlands and Italy to handle returns.
Rising opportunity in resale
Over the years, Azura Fashion Group has turned to the secondhand market to sell items that are returned. Today, around 40 per cent of its inventory is pre-loved, and it has a dedicated e-commerce site, Azura Reborn, where it lists returned items for rental and resale.
“We’re looking to build out this circular model, so when a product comes back to us, we can resell it as pre-loved or rent it out, rather than it sitting in our warehouse collecting dust,” Wood said.
The business recently launched a buyback service that enables customers to sell luxury items they have purchased back to Azura Fashion Group, furthering its investment in the circular economy.
“When a customer purchases from us, we automatically record the sale, and all they need to do is click a button to say, ‘Yes, I want to sell that back to Azura.’ We’ll list it through our tools onto a secondhand marketplace straight away and look after the whole thing,” Wood said.
The business plans to extend this capability to the suppliers and online marketplaces that it works with in the future.
“We’re trying to get to a point where we’re giving businesses a secondary income and giving consumers a better experience. It keeps them loyal to the brand,” he said. “It helps fast-track the circular economy as well.”
Wood noted that consumers have already embraced the circular economy, and said luxury brands and businesses need to catch up.
“The message to brands is to get on board with the circular economy whilst it’s still young. You can get involved now, or you can be left behind,” he said.