China generates about 15 million tonnes of used clothing each year, a large share of which crosses the ocean to Africa's second-hand apparel market, forming an industry worth roughly 200 billion yuan, with the number of companies involved rising from 262 in 2016 to over 800 in 2020. In Africa, rider uniforms bearing the words "Meituan Waimai" and "Ele.me," Chinese school uniforms, and even old camouflage gear are common sights. Most of these garments come from used-clothing collection bins in Chinese residential compounds or scrap recycling stations; after sorting, cleaning, and baling, they are shipped to Africa, then passed down through layers of local wholesalers and distributors before ending up on market stalls.

Key points

  • China produces about 15 million tonnes of used clothing a year; if 10 million tonnes are exported to Africa, that corresponds to an industry scale of roughly 200 billion yuan; there were 262 companies in 2016, rising to over 800 in 2020.
  • Domestic exporters quote about 8-20 yuan/kg on platforms such as Alibaba, usually with a minimum order of 10 tonnes; a 100 kg bale yields about 2,000 yuan in gross profit, and one tonne can earn over 20,000 yuan.
  • In Africa, first-tier wholesalers pay about US$5 per kg on import; a shirt costs about 50 US cents and often sells for five or six US dollars; total profit from wholesale to retail is about three times, and some vendors earn US$1,000 a day.

Domestic used clothing comes mainly from two sources: first, public welfare collection bins in residential compounds, where clothes dropped off by residents often become hot-selling goods in African markets a few months later; second, scrap recycling stations, where peddlers buy by weight, often driving the price down to four or five yuan. These clothes converge at recycling plants for a second sorting. Badly damaged items go to reprocessing plants to be made into insulation materials, mops, and cushions, while wearable items are cleaned, baled, and loaded onto freighters bound for Africa.

About two months later, word spreads that a shipment has arrived at an African port, and local vendors begin a new round of "opening bales"—like opening blind boxes, they buy Chinese used clothes by the bale and only find out what styles are inside and how much they can earn once they open them. On the sourcing side, first-tier importers are mostly relatives of Africans in China or Chinese people in Africa; they do not do retail and distribute directly to second-tier wholesalers, who in turn resell by the bale to distributors at various levels, until the goods finally appear on market stalls. After stallholders get the goods, they hang the better-quality items for sale and put the rest on the ground, selling first at US$5, then cutting to US$4, and so on until everything is cleared.

Most African countries have underdeveloped economies, and for price-sensitive consumers, clothes costing a few dollars are still highly cost-effective "brand-name goods." A shirt bought for about 50 US cents can be resold for five or six US dollars, and even if it is finally dumped for US$1, there is no loss. However, the biggest share of profit is not at the stall level but in the upstream wholesale segment.

This business has continued to heat up in recent years. Chinese used-clothing exports already have public quotes on e-commerce platforms, and the price of 8-20 yuan/kg with a minimum transaction volume of 10 tonnes has made many companies smell an opportunity. The number of companies in the industry surged from 262 in 2016 to over 800 in 2020, showing the scale of the sector.

From collection bins in residential compounds to stalls in Africa, the Chinese used-clothing trade has formed a complete chain spanning two continents. It is both resource reuse and a highly profitable transnational business.

Source: "Meituan delivery guys" delivering food with AKs? Actually many of us are alumni of African mercenaries | Light Weapons Column_NetEase Mobile · Originally published on 2021-11-01