s new store The new store in Siam Discovery offers an impressive lineup of pre-owned clothing brands, mostly at the high end and sporting price tags to match. Secondhand it may be, but it’s not at the kind of entry-level price point for luxury that you might find in a premium factory outlet centre. It also has a selection of footwear, bags and watches. The spaces are tight since this is far from being Second Street’s biggest store in Southeast Asia, or even in Thailand: the branch at Big C on Rama IV in Bangkok is bigger, and the one at Singapore’s 313@Somerset weighs in at almost 600sqm. The clothing is displayed on the customary rows of racks, but with the more limited space it is like a TJ Maxx that’s been put through a compactor. The slightly cramped feel of the store has its upside: there’s nothing quite like an elbow-to-elbow treasure hunt for adding intensity to the shopping experience and urgency to buy. Most of the labels are Japanese, European and American, but over time it is likely that more domestic Thai brands will percolate into the collection as locals bring in their used items to sell. Geo Group has big ambitions Second Street is the primary vehicle for the overseas expansion of its parent company, Japan-based Geo Holdings, and has 949 stores in its homeland. But it is far from being the only string in the company’s bow. In all, the group consists of more than 2250 stores, including its Second Street chain as well as Geo and Geo Mobile (1,022 stores at mid-year), and three smaller chains: Okura, Luck Rack and Capsule Rakkyoku. Not all of the focus is on reuse: Geo and Geo Mobile stores sell brand-new as well as pre-owned items, while Luck Rack, which operates like a true off-pricer by purchasing surplus stock from manufacturers, and Capsule Rakkyoku both sell new. However, Second Street is the only one of the banners that is focused almost exclusively on reused clothing. Business is booming: in the first quarter of Geo Group’s fiscal year that ended June 30, the company booked 84.8 billion yen (US$540 million) in reused clothing and accessories sales. This represents an increase of more than 27 per cent over the same quarter a year ago and accounted for nearly 70 per cent of total company sales. The company has ambitious growth plans: it wants to double both its store footprint and sales over the next 10 years. Over the same time period, it wants to increase its overseas store count from the current approximately 160 to 1,000. It cites estimates that the global reuse market will grow from about US$245 billion now to around US$1 trillion by 2036. The limiting factor in Southeast Asia is the number of large cities: Second Street is very much an urban concept because its labels are predominantly high-end so it will open mainly in places with large, growing urban populations like Kuala Lumpur and Bangkok. This is not the kind of concept, like, for example, fast fashion, that will lend itself to expansion in secondary markets. Moreover, the growth targets seem ambitious and rely heavily on rapid urbanisation. For example, the company wants to have about 50 stores open in Thailand, almost all in Bangkok, by 2036. However, H&M, arguably the most popular global fast fashion brand in the country, has opened only just over 30 nationwide after being in Thailand for 14 years. While H&M has a strong presence in secondary Thai cities as well as Bangkok, Second Street won’t have the same number of opportunities. Defence against counterfeits In Second Street’s business, defence against counterfeits is critical. In its Asian business, the emphasis is on human training and expertise to determine if an item is authentic. Thus, company manuals and detailed sensory inspection of items brought in by the public for sale are the first lines of defence against fakes, but that doesn’t mean counterfeits don’t get through now and again. The US, where Second Street has more than 50 stores, doesn’t possess the sheer breadth of human authentication experience that exists in Japan, so scaling up of the business wasn’t really viable without technology: thus, in the US, AI imaging is relied upon heavily to verify (or otherwise) the authenticity of items. As Second Street scales up in Southeast Asia, technology will likely become increasingly important here too for counterfeit protection. While Geo Group’s top brass in Nagoya are brimful of confidence in their business model, they still face residual hurdles in taking reuse retail to the next level. Fast fashion is extremely cheap, and e-commerce/social commerce sites like Tiktok offer merchandise that is so cheap it is virtually wholesale in the sense that it is not uncommon for small entrepreneurs to purchase items from there and resell at a profit in street markets. So reuse faces heavy competition at the low end, while at the high end it must overcome the residual stigma attached to secondhand clothing among more affluent Asian consumers. However, the stigma is eroding as recycling fashion becomes trendy for environmental reasons. Further reading: Vietnamese streetwear gatecrashes Thai market