Looking to save some cash? Buying second-hand items on sites such as Kijiji or eBay can help shave dollars off the retail price. And buying gently-used is big business in Canada: the inaugural Second-Hand Economy Index by Kijiji reveals consumers spend nearly $30 billion on used goods per year.
A Growing Marketplace
In fact, the second-hand economy contributes a whopping $34 billion to Canada's GDP, as items purchased second-hand help offset the costs of our importing industry. Simply buying durable goods like furniture second-hand creates an extra $10 to $15 billion per year of re-use. And there's big benefits to the consumer, as the average family of four could save about $1,150 per year by buying used.
“The second-hand economy provides a great opportunity for Canadians to stretch their budgets,” said Shawn McIntyre, Community Manager, Kijiji. “In 2014, the average Canadian granted a second life to 76 products with a family of four saving approximately $1,150 per year by buying second-hand goods.”
Kijiji, a popular online second-hand marketplace, is used by over 23 million Canadians each year and holds the distinction of being the nation's most popular way to buy and sell used items.
Tips for Consumers Buying Second-Hand
Despite its growing popularity, there are risks associated with buying products sight-unseen online - and no one wants to get stuck with a lemon. It’s important for consumers to exercise caution. Here are a few tips:
Double Check its Condition: When buying used products, pay close attention to the item’s condition. Some sites, like eBay, include a detailed summary of what shape it's in, but this info may not always be disclosed by sellers, so inquire directly if possible. If the product does come with damage, ensure you know the specifics. For example, a second-hand iPhone may have a scratched screen. If you’re not fine with that, you should probably think twice about buying that specific item.
Confirm the Warranty: If the product was recently purchased, it may still come with a warranty. It’s important to find out if the warranty is still valid when the item is resold, as many warranties are only valid for the original purchaser.
Stop Before You Toss: Buying used goods is only one half of the second-hand economy - consider selling your own gently-used items for an extra cash infusion. As the saying goes, one person’s trash is another person’s treasure. In fact, the top three most acquired and disposed of categories of goods are clothing, shoes and fashion accessories; entertainment equipment; and baby clothing & accessories. Cell phones, specifically, are a popular rerun item. Can't afford the latest iPhone out of the box? Try swapping in your old model, and find an upgrade from another seller.
Protect Your Payment: Using a credit card when shopping online adds an extra layer of security should your purchase go awry. Features such as fraud and purchase protection and the ability to stop payments can help you recoup any losses should your seller not fulfill the transaction. Using a third-party payment system such as PayPal can also ensure you're protected as a customer.
Sean Cooper is a Financial Journalist and Personal Finance Expert, living in Toronto, Ontario. He offers Unbiased Fee-Only Financial Advice, specializing in pensions and the decumulation of financial wealth in retirement. Follow him on Twitter @SeanCooperWrite and read his blogs and request his writing services on his personal website: http://www.seancooperwriter.com/