StockX Remains Open During Covid-19 Because the Resell Market is Still Strong
Covid-19 and the stranglehold it has on society has changed the way we shop, work, and — most importantly — how a large percentage of the population lives its daily life. Most employers have turned to an indefinite work from home policy, while many countries and cities around the world have forced all non-essential businesses to close or take their business online. In Germany, restaurants only offer takeout or delivery service, and any businesses that aren’t pharmacies, grocery stores, or other medical institutions have completely shut down.
Still, StockX — one of the biggest resell platforms worldwide — has made the conscious decision to keep most of its warehouses and verification centers open (its authentication center in Detroit has been closed in accordance with the State of Michigan executive order). This is in large part due to the fact that the resell market, unlike the stock market, has been largely unaffected by the coronavirus crisis.
According to StockX, the average prices of the 500 most popular shoes bought and sold on the platform are slightly down when comparing prices in late March to late February, though the decline is relatively small: 4 percent across all sneakers. The Dow Jones on the other hand, dropped around 30 percent from its February high, proving that the sneaker resell market — while often compared to the stock market — is a very different system.
The real-life stock market is tied to macroeconomic changes and the financial health of certain businesses. The sneaker resell market is tied to the supply and demand for a specific commodity. Recent events have little to no bearing on sneaker prices, as scarcity and desirability play a larger part in determining the value of specific sneakers.
In a post on its blog, StockX explains its decision to keep authentication centers open, which in today’s climate is controversial to say the least. “In an effort to continue serving StockX customers globally, we have been working tirelessly to keep our marketplace open and operational while, most importantly, prioritizing the health and safety of our team members and community,” reads the statement before outlining the measures the company has taken.
These include new procedures for personal and workplace hygiene in accordance with the CDC and WHO, splitting shifts between employees, reconfiguring work stations to avoid overcrowding, and stocking up on disinfectant.
StockX isn’t the only resell business that has kept its figurative doors open. The RealReal, a used designer e-commerce platform, has kept its warehouses in New Jersey open for business, even after closing its four physical locations in New York, Los Angeles and San Francisco. This has some employees fearing for their safety, as per The New York Times.
While StockX claims to have the best interests of both its employees and its customers at heart, it’s hard to ignore that those interests — while overlapping occasionally — are at odds with one another. Is the resell market really an essential business? It may be for those that have turned flipping sneakers into their full-time jobs, but so are the jobs of wait staff, hospitality workers, and anyone else affected by the closure of businesses.
While those industries have taken the short-term economic hit to try and quell the spread of Covid-19, it seems as though the resell industry has continued on unfazed. Of course, if no shoes were able to be resold, StockX employees would face losing their jobs as a result, and this is something StockX is trying to prevent for as long as possible. Some would argue, however, that it is StockX’s responsibility to make that decision proactively, rather than put pressure on its employees to travel to work and interact with more people than absolutely necessary as the coronavirus continues its spread across the United States.
StockX also added that any employee who felt uncomfortable or unable to go to work could do so without recourse. The company is also offering everyone working at an authentication facility a $200 spot bonus to purchase supplies or emergency items, as well as a 25 percent pay increase through April.
StockX is a business first and foremost, and needs to make sure it can weather the pandemic by continuing to make money for as long as it can. And just as the health and safety of its employees is a complicated matter that isn't simply black or white, StockX’s constituents rely on the platform to stay open during this time.
With more time at home and other streams of revenue likely compromised, resellers need to move inventory to weather the storm, too. Having large amounts of deadstock product is a quick and (thanks to StockX) relatively easy way to liquidate and make some cash, especially in times of financial hardship. The stuff you've had “on ice” is a very real commodity that can really help out in a pinch.
Additionally, as much as drops and limited products don’t really “matter” in the grand scheme of things, chasing the next drop to rock, stock, or flip it is a form of escapism for the streetwear community. And in a time where we're all searching for some form of normalcy, plenty of us are trying to get “Ws” where we can.
It’s clear by StockX’s blog post that the company takes the health and safety of its employees seriously and is doing everything it can to ensure the authentication facilities continue to operate. It’s also clear that StockX is a business and needs to keep making money in order to keep people employed. But what many seem to forget is that just as much as StockX depends on its authentication employees and buyers and sellers to keep the business running, the buyers and sellers depend on the service being able to fulfill its promises.
If StockX stops all buying and trading, a factor to consider would be that many resellers and those buying the product off the platform would lose an important means of maintaining normalcy, adding yet another layer to this difficult and touchy subject.
Proving its commitment to its constituents, StockX has also started a fundraising campaign that will ultimately donate more than 200,000 meals to Feeding America’s Covid-19 response fund. StockX has pledged $20,000 and will donate $1 for every use of the hashtag #FlexFromHome in combination with a fit pic posted to social media.
Clearly, there is a balancing act going on and StockX has found itself in the middle of it. The question, it seems, is one of ethics; is keeping the authentication facilities operational and resell markets up and running worth the increased risk to StockX employees?
