Reclo, a Japanese ecommerce startup that focuses on used luxury brands, announced plans to further expand in the Chinese market after it raised ¥3.6 billion ($33.8 million) in fresh funding from various investors.
The China expansion plan was even bolstered as CITIC Capital, the alternative investment arm of Chinese financial conglomerate CITIC Group, backed the funding round, along with SBI Investment and SBI Securities.
In a statement, Reclo’s owner Active Sonar said the fresh investment will be used to further expand in China, a booming market for luxury brands. In 2017 alone, China’s luxury market further expanded to over Rmb700 billion (US$97.7 billion), according to data cited by the company.
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Founded in 201, the Tokyo-headquartered commerce firm allows owners of luxury brands to resell their items at a reasonable price. The items on Reclo’s platform include bags, wallets, clothes, and jewellery.
Reclo also provides expert appraiser to ensure that items posted on the site are not fake and have been priced accordingly. Additionally, the company handles all the aspects of the entire sale – from listing and processing payments to delivering the items to the buyer.
The sellers only need to send the items to Reclo and the company will take care of everything, the commerce firm said.
The ecommerce firm’s China expansion plan is not actually new as it already has a presence in the country. Reclo launched a Chinese version of its platform in October 2016. Immediately, the move boosted the firm’s overall sales.
Last year, China sales accounted for about seventy percent of the company’s total overseas revenue, prompting the company to establish a local subsidiary in Shanghai.
The company said it sees huge potential in China’s used luxury market because while the country is one of the top market for luxury items, used luxury market only accounts for just 1.4 percent of the total.
Reclo, however, said it will expand its offering from just luxury brands. Going forward, the company said it intends to sell and collect used branded products from around the world to achieve its goal of becoming a global ecommerce firm.