Used luxury goods sites might seem like a threat to sales of new luxury product at retail stores but, as with luxury cars and indeed gadgets, having an easy way to offload unwanted items often encourages further consumption, and brings new customers to brands without the budget to shop at full price. The problem has been finding an easy, trustworthy way for buyers and owners to deal. With the former head of Louis Vuitton Japan heading up one of the leading platforms, this problem looks to have been solved.

Japanese wardrobes are bursting with unused luxury clothing and accessories – the estimated value varies between ¥600 billion and ¥1.2 trillion, Japan’s luxury brand market is the second or third largest. While some consumers want to hold onto everything for sentimental reasons, many others would happily sell on little used luxury goods if only there was an easy way to do it.

Although there are a plethora of CtoC services that make it easy for buyers and sellers to find each other, in luxury goods the stakes are that much higher and trust becomes a bigger issue. Not least is the risk of a purchase turning out to be counterfeit, all the more so given the increased use of CtoC markets by manufacturers of fakes. In addition, quality and delivery worries increase when purchasing a used item online for serious money.

To solve this problem, several trusted intermediary services have sprung up, first in the US and now in Japan. The key to their expansion, and where they threaten used goods stores, is their use of the non-consignment system. Under this model, trusted intermediary services don’t take title to merchandise – thus essentially being a CtoC service – but crucially still provide the product checking and payment guarantee services of a retailer to smooth transaction flow. In this way they aim to offer the value of a retailer but without taking similar margins.

The first company to make a real success with this service is US-based luxury flash sale site, The RealReal, which launched a Japanese version in August 2013. RealReal Japan was initially headed by Keisuke Seto, formerly head of Groupon Japan, but last month The RealReal lured former head of Louis Vuitton Japan Kyotaka Fujii to run the business – Seto will stay on as founder and shareholder.

The RealReal is in essence a high service used goods store and it is the level of service which appeals to many Japanese. The RealReal offers what it calls a ‘white glove service’; potential vendors make an appointment request through their smartphone, and The RealReal associates go through vendors’ wardrobes, selecting items on a list of preselected luxury and designer brands and then shipping to its warehouse for free.

This makes getting rid of stuff easy, and by authenticating and grading each item, purchasers can trust the service. Products are held on consignment and then priced and sold in a series of flash sales at up to 90% off prices of equivalent new product, but still ranging from ¥5,000 to ¥1 million. The vendor gets as much as 70% of the sale price – 60% at the start and then rising to 70% for sellers with turnover of more than ¥500,000 a year, or for corporates.

As well as the convenience of home visits by associates, this high return is a key differentiator from the many used goods retailers such as Komehyo, Brand Off, Daikoku and online store Brandear. They too buy used luxury items, but expect to squeeze vendors to around 20-30% of the expected resale value, driven by the fact that they take title and so risk.

The high service and big margins go down well in Japan and in its first full year of trading The RealReal Japan expects sales in excess of ¥1 billion – in the US sales hit ¥6 billion in FY2013 and membership of 2.2 million after just two years in operation. Local CEO Fujii believes the Japanese market has bigger potential given the sheer quantity of well-cared for luxury goods stashed away and the high level of demand.

Not surprisingly, The RealReal’s success has encouraged local competition. There are also plenty of no frills CtoC fashion marketplaces in Japan such as Mecari, Frill, Locari, Stulio and as of last month Sumally, not to mention Yahoo and other free-to-setup e-commerce sites. Just last month, a similar service called Reclo (reclo.jp) was launched by Active Sonar, an e-commerce and direct marketing firm with reported sales of around ¥4 billion. Another service went live in 2012 in New York co-founded by Japanese national Rie Yano but which focuses solely on women’s apparel.

Like The RealReal Reclo offers home visits – although limited to within the Tokyo 23 wards for now and only for customers with 10 or more items to sell. Reclo hopes to differentiate from The RealReal by offering items for sale all the time rather than through flash sales, and says it will gradually lower prices of stock in order to maximise sales. Thus an item that is still unsold after five days will be discounted by 5% and then in similar increments over three months, subject to limits set by the owner. Within 18 months Reclo is targeting sales of 45,000 items and a membership of 300,000 and longer term sees real potential in providing Japanese vendors the chance to sell their unused luxury goods to Asian consumers – a perfect match.