Interview: The Edit LDN helping build an asset class
As the price of limited-edition sneakers pushes ever higher and the resale market continues to grow at a rapid pace, The Edit LDN is looking to carve out a position as the premium marketplace for the burgeoning category.
The Retail Bulletin met with Moses Rashid, founder & CEO of The Edit LDN, at his Shoreditch headquarters in London’s East End to discuss how he is growing the business on multiple fronts. Although the company is a streetwear platform – selling rare clothing and accessories – sneakers account for 70% of its business and are undoubtedly the potential growth engine for the operation.
Looking after buyers and sellers
As with any marketplace The Edit LDN brings buyers and sellers together to trade product and Rashid carefully looks after both these groups as he seeks to build the volumes traded on the site while competing with rival marketplaces including StockX, Goat and Laced. He regards the differentiation as delivering a more premium experience.
“We’re 10-20% more expensive to buyers because of our speed of delivery, curation and using only authentic sources for products while sellers use us because of this extra 10-20%,” he explains, adding that the cultivation of the sellers is crucial to the success of the business. These are the individuals who get access to new products that are often produced in very limited numbers and are tough to purchase.
“We work with these early access people who use technology or their relationships in the industry to secure products. It’s our job to give them the platform to then resell these goods. They operate like small businesses,” he says.
Since launching in January 2020 Rashid says the average sale price is around £360 and that volumes are up 500-600% year-on-year. The uplifts are reflected in the buoyancy of the industry as a whole with the sneaker market involving “highly engaged customers”, according to Cowen Equity Research, which found they typically transact five-times per month with an average value of £300. It predicts the market (for sneakers and streetwear) will grow by an incredible $22 billion by 2030.
The increasing volumes of sales, which is driving healthy levels of liquidity for certain sneakers, has led to the category being increasingly viewed as an asset class by investors. It represents an interesting alternative to putting money in shares, property or fine wine. The Edit LDN is contributing to this liquidity on its own marketplace by also buying and selling products, with 20% of transactions undertaken on its own account. Interestingly, despite the move to regard sneakers as a form of investment Rashid reckons that as much as 80% of buyers intend to wear their purchases.
Helping The Edit LDN grab more of this market is its focus on “cool activations” within the stores of high-end retailers such as Harrods in the UK and Galleries Lafayette and online with Soho House. When this is combined with its sustainability credentials and positive TrustPilot reviews, Rashid says it is a strong proposition.
Another development has been the recent launch of a fulfilment centre. Although presently located at the company’s headquarters, the plan early next year is to use a dedicated space when volumes increase. The warehouse will have the capacity to house up to 100,000 units. The proposition is similar to the ‘fulfilment by Amazon’ service that the online giant offers sellers of goods on its site.
The resellers give The Edit LDN their products to hold – for which it charges a storage fee – and whenever they choose to sell the items, they will have already been authenticated by the specialists at The Edit LDN and can therefore be dispatched rapidly.
If Rashid, along with the research team at Cowen, have got it correct then there is incredible growth ahead in this market, which is helped by the youthfulness of the participants in the market, with the typical buyer on The Edit LDN marketplace being between 18 and 34 years old while sellers are only 15 to 22 years old.
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