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Luxury is not merely about indulgence or high prices—it is a dynamic ecosystem shaped by economics, culture, and technology. Beyond the shining boutiques of LVMH, Gucci, or Chanel, lie two thriving parallel markets: the grey market and the secondhand market. These segments, while distinct, are interwoven, forming a complex network of supply, demand, and consumer behavior.
Luxury overview
As per Bain & Company in 2022 the global luxury market was worth $382 billion in 2022. At a CAGR of 6-8 per cent from 2022-2030 it is expected to be worth $540-$580 billion by 2030. At the core of the luxury ecosystem lies the global market, driven by heritage brands such as Hermès, Prada, and Cartier. These brands dominate with their focus on craftsmanship, storytelling, and exclusivity.
Most of the growth in the segment is being driven by aspirational spending. The rising middle class in emerging markets like China and India aspires to own symbols of status and achievement. On the other hand, high-end consumers value immersive brand experiences, from exclusive store launches to bespoke services. And conscious consumerism is pushing brands to adopt ethical sourcing and sustainable practices, appealing to environmentally aware buyers.
While inflation and geopolitical tensions present challenges, the global luxury market remains resilient, with digital transformation and market diversification. E-commerce, virtual shopping experiences and localization strategies are critical for brands to sustain growth.
Grey market’s threat
Even as the luxury segment continues to grow, the grey market in luxury an opaque frontier has been growing simultaneously. As per studies was worth $20-$30 billion in 2022-23, experts say it’s growing faster than the global luxury market but difficult to quantify due to its informal nature. The grey market, though often frowned upon by luxury brands, caters to consumers seeking genuine goods at discounted prices. It operates through unauthorized channels like online resellers or duty-free shopping, blurring the lines between affordability and exclusivity.
And what is helping it grow are the consumers, especially younger buyers, are who are unwilling or unable to pay full retail prices but still crave luxury brands. Grey markets also gives access to hard-to-find items, from limited-edition sneakers to region-specific collections. In fact, online platforms like eBay or private resellers offer seamless shopping experiences which pushes up demand. However, the grey market faces scrutiny over issues like authenticity, product warranties, and legality. Brands are combating this segment to safeguard their pricing strategies and brand prestige. Still, its growth highlights a demand that cannot be ignored.
Secondhand market a growing segment
As per Bain & Company the market size of secondhand luxury was worth $37 billion in (2022). And at a CAGR of 10-15 per cent in 2022-25 it’s expected to touch $64 billion by 2025. The secondhand luxury market is a star performer, merging affordability with sustainability. Platforms like The RealReal, Vestiaire Collective, and Fashionphile have transformed how consumers perceive pre-owned goods, making them desirable and socially acceptable. And as awareness about environmental impact grows, consumers are turning to circular fashion, reducing waste through resale. Moreover, luxury items retain or even appreciate in value, making them attractive for savvy buyers and sellers. Interestingly, luxury brands themselves are entering the secondhand market. Initiatives like Gucci Vault and Balenciaga’s resale programs signal a shift, as brands recognize the potential in owning a slice of this burgeoning market.
However, the global, grey, and secondhand luxury markets do not exist in isolation, their interactions create ripple effects across the industry. The grey market undermines official pricing structures, affecting brand equity and exclusivity. However, it also taps into consumer segments that the global market may overlook. On the other hand, the secondhand market often relies on inventory from both the global and grey markets, providing a circular flow of luxury goods. A handbag bought in a flagship store might eventually end up on a resale platform, creating opportunities for new buyers.
Consumers, too, traverse these segments. A single buyer might splurge on a new luxury watch, sell a vintage piece through a resale platform, and pick up a discounted grey-market item—all within a year. This fluid movement showcases the interconnected nature of the ecosystem.
Therefore, the luxury market, in all its facets, reflects the changing desires and values of global consumers. The global market continues to thrive on exclusivity and innovation, while the grey market fills gaps in affordability and access; the secondhand market aligns with growing demands for sustainability and value. For brands, navigating this multifaceted landscape requires agility and foresight. By embracing digital tools, sustainability, and creative partnerships, they can not only protect their legacy but also unlock new growth opportunities.
The 2025 Spring Fair, set for 2-5 February at NEC Birmingham, will showcase a newly curated space: The Summer House: Home, Gift & Lifestyle Edit. Marking its 35th anniversary, this reimagined destination promises a seamless, inspiring experience for buyers and interior designers, with a focus on high-end home decor, furnishings, and gifts.
New additions include Portmeirion’s Minerals collection and Bedeck’s debut with three exclusive ranges. Established brands like My Gifts Trade, Casa Fina, and Ulster Weavers return, alongside newcomers Sofia Toscano and Torres Novas. Sustainability also takes center stage with Hug Rug, Weaver Green, and The Braided Rug Company.
The Summer House Edit will feature curated displays highlighting craftsmanship and design excellence. Notable exhibitors include Gallery Direct, DRH Collection, and Malini. The event introduces a dedicated interior design focus, supporting residential and hospitality projects with brands like Mindy Brownes Interiors and RV Astley.
Event Director Soraya Gadelrab emphasizes the refreshed concept as part of Spring Fair’s 75th anniversary celebrations, stating, “The Summer House Edit reflects our commitment to premium products and memorable experiences.”
With over 1,200 exhibitors, Spring Fair 2025 promises to be the most anticipated in its history, offering an immersive journey into the future of home and lifestyle retail.
Temu and Shein, popular low-cost Asian e-commerce platforms, are facing heightened regulatory scrutiny in Europe. EU authorities are cracking down on retailers evading customs checks, with proposals including a new tax on platform revenue and handling fees to curb competitive pricing.
European Trade Commissioner MarosSefcovic highlighted that 4 billion low-value parcels, triple 2022’s figure, are expected to enter the EU this year, many exempt from customs duties due to the €150 threshold. This has raised concerns about unchecked imports of counterfeit or dangerous goods. The EU is now considering scrapping this threshold, mirroring similar moves in the US.
Officials fear platforms’ rock-bottom prices undermine EU competitors, who face higher production costs due to strict regulations. Screening all parcels, however, remains a logistical challenge, with major hubs already processing millions daily. A handling levy on non-EU shipments is also being discussed.
Additionally, Temu faces allegations of misleading consumers through fake discounts, hidden conditions, and unclear contact details. Meanwhile, Amazon’s low-cost storefront, Haul, recently entered the US market, targeting budget-conscious shoppers.
Bangladesh’s ready-made garment (RMG) exports to the European Union (EU) are likely to decline by as much as 21 per cent due to the dual challenges posed by the EU-Vietnam Free Trade Agreement and Bangladesh’s upcoming graduation from the Least Developed Country (LDC) status, according to a recent study by RAPID and the Friedrich-Ebert-Stiftung.
Currently benefiting from duty-free access to the EU under the Everything But Arms (EBA) initiative, Bangladesh faces the prospect of tariffs up to 12 per cent starting in 2029. In contrast, helped by efficient trade policies and investments in its supply chain, Vietnam is likely to enjoy zero-duty access to the EU by 2027 under its FTA.
Bangladesh's slower progress in backward integration and trade policy implementation exacerbates its vulnerability, threatening its global competitiveness. The study emphasises the urgency of negotiating extended transition periods for LDC graduation, relaxing rules of origin under the Generalised Scheme of Preferences (GSP+), and pursuing additional FTAs to maintain market access.
To counter these challenges, the report underscores the need for strategic reforms including engaging with the EU to extend LDC benefits and relax GSP+ conditions, investing in sustainable practices, including man-made fibers and recycling technologies, to align with EU standards, addressing energy supply deficits and enhancing trade logistics to improve efficiency and reducing dependency on apparel exports by exploring new sectors and markets.
While rising labor costs in China and Vietnam could redirect some orders to Bangladesh, the report cautions that internal hurdles, such as energy shortages and inefficiencies in banking systems, continue to undermine growth potential. Additionally, ongoing FTA negotiations with Japan and Singapore offer hope but require structural reforms to unlock their full benefits.
The study concludes that Bangladesh must act swiftly to adopt forward-thinking policies and meet global sustainability standards to retain its position as a leading export hub. Failure to do so could significantly impact its economic trajectory as competitors like Vietnam continue to gain ground in the lucrative EU market.
Pakistan needs to urgently introduce a new policy to boost cotton production in the country, opines Pakistan Cotton Ginners Association (PCGA). In FY2024, Pakistan’s cotton production declined by 33 per cent.
By November 30, 2024, Pakistan produced 5,190,725 bales of cotton as against 7,753,473 bales produced in 2023. Cotton production in Punjab declined by 34.19 per cent to 2,459,684 bales in 2024 compared to 3,736,749 bales in 2023.
Similarly, cotton production in Sindh contracted by 32.01 per cent to 2,731,041 bales this year as against 4,016,724 bales last year. Production in Balochistan contracted to only 155,800 bales.
Sajid Mahmood, Cotton Expert, attributes this decline to weak policies and practical challenges. He emphasise on the need for a comprehensive revival program for cotton cultivation. According to him, a minimum support price of Rs 10,000 per maund needs to be set to incentivise farmers. Farmers need to utilise modern, climate-resilient seeds to combat pests like whiteflies and pink bollworms. To achieve this, farmers need gain financial stability to prioritise cotton over other crops, adds Mahmood .
Research institutions like the Pakistan Central Cotton Committee (PCCC) require immediate funds to boost cotton production. Duty-free imports of cotton should be banned in order to encourage local farmers, states Mahmood. He urges for the strengthening of research and development facilities in the country. He also calls for direct market access for farmers, bypassing exploitative middlemen.
For the growth of both the industry and farmers, it is essential to remove the 18 per cent tax on cotton, says Mahmood. Cotton production in the country can be restored by adopting a sustainable strategy rooted in practical measures.
The 16th edition of HGH India is being held from December 4-6, 2024 in Bengaluru. The exhibition is hosting more than 700 brands and manufacturers from 32 countries.
Featuring home textiles, décor, furniture, house wares and gifts, the bi-annual show is being held at the Bangalore International Exhibition Centre. A few of the highlights of this event includes a conference on the evolving India sleep market held on December 4, 2024, a panel discussion on house wares trends, a sustainability pavilion and the Indian Heritage Pavilion, which highlights National Award-winning artisans showcasing traditional Indian art forms passed down through the generations.
This is the expo’s debut edition in South India which contributes 20 per cent to India’s population and 35 per cent to its GDP. The region is fast emerging as an important production and services hub. The per capita income in this region is about 50 per cent higher than the five North Indian states, which gives it a higher purchasing power, states Arun Roongta, Managing Director, HGH India.
As Western countries actively seek to ‘de-risk’ their supply chains from China, India emerges as a prime contender to capture a significant chunk of this re-routed trade. But can India truly capitalize on this opportunity, or will it be caught in a tangle of its own making?
The ‘China Plus One’ strategy, adopted by many companies to diversify their sourcing, is gaining momentum. This strategy aims to reduce dependence on China by adding another manufacturing hub to the mix. And India, with its vast labor pool, cotton production prowess, and growing manufacturing capabilities, is a natural choice.
Where India can stitch success
As one of the largest producers of cotton globally, India has a significant advantage in raw material sourcing. A large and relatively inexpensive workforce makes India attractive for labor-intensive textile manufacturing. Add to this, government initiatives like the Production Linked Incentive (PLI) scheme for textiles that are aimed at boosting domestic manufacturing and attracting foreign investment. For example, Arvind Limited has invested heavily in modernizing its facilities and expanding its product range to cater to international brands. Similarly, Welspun India,, the leading home textile manufacturer, has successfully captured a significant share of the global market through innovation and quality.
Table: Comparative investments in textile industry ($ billion)
|
Country |
2020 |
2021 |
2022 (Estimated) |
|
China |
250 |
270 |
285 |
|
India |
40 |
45 |
50 |
|
Vietnam |
30 |
33 |
36 |
|
Bangladesh |
25 |
28 |
30 |
Sources: Source: Statista, Invest India, various industry reports
In fact numerous opportunities are waiting to be unravelled for India. In garment manufacturing, India can become a major hub, especially for Western brands looking to diversify their sourcing. With growing demand for specialized fabrics in sectors like healthcare and automotive, India can carve a niche in technical textiles. What’s more, India's rich textile heritage and design talent can be leveraged to create unique, high-value fashion products.
Growth challenges
However, the path to success is not easy as infrastructure bottlenecks are a major dampener. Inadequate infrastructure, including unreliable power supply and logistical challenges, can hinder production and increase costs. Lack of skilled labor in areas like design, technical textiles, and modern manufacturing techniques too needs to be addressed. Also complex regulations and bureaucratic hurdles too can deter investment and slow down business operations.
Therefore, while India has the potential to become a textile and apparel powerhouse, it needs to address its challenges proactively. By improving infrastructure, upskilling its workforce, and streamlining regulations, India can truly seize this opportunity and weave its way to dominance in the global textile industry.
India’s cotton market continues to grapple with significant supply-side challenges despite a 0.04 per cent rise in cotton candy prices in South India. This rise in cotton candy prices in South India is being driven by a rise in apparel orders and exports.
India’s cotton production is also expected to decline by 7.4 per cent to 30.2 million bales in 2024-25 due to reduced planting areas and crop damage caused by heavy rainfall. USDA has alson revised its production estimate for India to 30.72 million bales. This decline in production estimates is anticipated to impact exports while boosting imports, which are projected to rise to 2.5 million bales during the year.
India’s production challenges are expected to cause global cotton prices to rise even as supported by higher yields in China, Brazil, and Argentina, worldwide output is predicted to increase by 200,000 bales. Nonetheless, the market is facing some downward pressure from Hurricane Helene’s disruption of U.S. production and a global dip in import demand.
In India, with a 9 per cent Y-o-Y shrinkage in cotton acreage, particularly in Gujarat, farmers are shifting to more profitable crops like groundnuts. However, despite this shortage in supply, domestic cotton demand in India is projected to remain steady at 31.3 million bales in 2024–2025.
The rising prices and tighter supply chain have sparked mixed reactions in the market. Apparel manufacturers are voicing concerns about potential cost escalations, while exporters are keeping a close eye on global price trends.
Stakeholders are urging the government to introduce new policies to support farmers in addressing crop damage and exploring more sustainable planting practices to stabilise cotton production.
Indian fashion brands Doodlage, Lovebirds, Ka-Sha, Paiwand Studio, Sonam Khetan, and Urvashi Kaur have partnered with Canopy, an environmental non-profit focused on protecting Ancient and Endangered Forests and promoting Next Gen Solutions in the fashion industry. Joining sustainability leaders like Flipkart and Anita Dongre, these brands are part of a global network of over 950 companies committed to advancing circular supply chains and forest conservation.
The announcement follows Canopy’s ‘Fashion for Forests’ event in New Delhi, where Indian designers and innovators discussed reducing the fashion industry’s environmental impact and scaling sustainable materials derived from recycled textiles and agricultural residues. With India generating over 500 million tonnes of agricultural waste annually, transforming this into textiles and packaging could position the country as a global leader in low-carbon, circular materials.
Nicole Rycroft, Founder of Canopy, emphasized that India’s fashion industry is well-positioned to lead in sustainable textiles while safeguarding biodiversity. She highlighted the role of partnerships with innovative brands in driving this transition and bringing the vision of eco-friendly fashion to fruition.
Gursi Singh and Amrita Khanna, founders of Lovebirds, stressed their dedication to purpose-driven creation, noting that partnering with Canopy supports their commitment to sustainability across all aspects of their brand. Similarly, Karishma Shahani Khan, founder of Ka-Sha, acknowledged Canopy's role in strengthening their circular practices and enabling the exploration of innovative, sustainable materials.
With these partnerships, the Canopy Style initiative now includes 560 brands globally, collectively representing over $1.06 trillion in annual revenues. The collaboration underscores how fashion can drive positive environmental change through creativity, innovation, and sustainable practices.
A pioneering report by Circle Economy, supported by funding from the H&M Foundation, offers an unprecedented look at circularity in the clothing and textile industry. Titled, Circularity Gap Report Textiles, the study calls for urgent action to reduce the sector's environmental footprint by adopting circular economy principles such as reuse, recycling, and slow fashion.
The report uncovers startling statistics: of the 3.25 billion tons of textile materials used annually, only 0.3 per cent are obtained from recycled sources. Furthermore, 70 per cent of these materials are fossil-fuel-based synthetic fibers. The report advocates a focus on renewable and recycled fibers, improving garment durability, localising supply chains, and scaling back production and consumption to propel the industry towards a sustainable and circular future.
The report offers actionable insights for the textile industry, says Christiane Dolva, Head - Innovation, Research & Demonstration, H&M Foundation. Its findings aim to inspire industry-wide transformation for the benefit of people and the planet, she adds.
To achieve a circular textile industry, the report makes four key recommendations including reducing overproduction, expanding environmental priorities, ensuring a just transition to circularity and fostering collaborative action.
Quantifying circularity in textiles for the first time, the report emphasises on the urgent need to transform the entire value chain, notes Hilde van Duijn, Managing Director, Circle Economy Foundation. The industry needs concrete, scalable actions to contribute meaningfully to a sustainable future, he adds.
The Circularity Gap Report Textiles aligns with the H&M Foundation’s ongoing initiatives, such as the Global Change Award, which supports innovations benefiting both people and the planet, and Saamuhika Shakti, a program advancing inclusive circularity by empowering waste pickers. Moving forward, the Foundation plans to use the report’s findings to inform its efforts to decarbonise the textile industry equitably, identifying areas where its philanthropic support can have the greatest impact.
By highlighting circular economy principles and actionable strategies, the report sets a roadmap for reshaping the textile industry into a more sustainable and socially responsible sector.
