Sneakers have been an integral part of fashion for longer than I have been alive. There are hyped-up sneakers being released every month and, if you are lucky enough to buy a pair, the resale price can be astronomical. It’s not unheard of to make upwards of a 200 percent profit on a pair of sneakers. I remember when I was successful in purchasing a pair of the Pirate Black Yeezy Boost 350 sneakers for about $200. I was extremely excited to wear them, but I felt the need to satiate my curiosity and looked at the resale prices for my pair. When I saw that I could realize a 300 percent profit by selling them, I was no longer able to look at my sneakers as $200 shoes but rather $800 ones — I had to sell them.
Some people have even turned sneaker resale into a full-time job. Recently, a man named Allen Kuo entered the spotlight of the sneaker community, posting pictures with about 100 pairs of the Yeezy 750 Boost sneakers released in June of 2016. For reference, the retail price on these sneakers is about $350 and the resale price according to StockX, a reputable site for finding a fair price for resale sneakers, is about $950. Some quick math tells you that Allen is making at minimum $60,000 on the release of a single pair of sneakers (he has the sneakers posted on his site for $2,000, so he may be seeing even more in profits from this venture). This isn’t the only pair of shoes that he has gotten en masse this year: Kuo has posted pictures on his Instagram with other coveted Yeezys and Jordans whose resale values have surely shown him many more thousands in profits.
Kuo is not unique in this venture, though. For every Allen Kuo in the sneaker game there is also a twenty-something year-old kid with a “plug” who posts on every Facebook buy/sell/trade group that you’re a part of that they have ten pairs of the new sneakers for sale at, maybe, a 250 percent markup. Sneaker bots have also been around for many years. A bot essentially functions as an “add-to-cart” service for prospective sneaker purchasers. These script packages capitalize on the fact that humans can only type in their shipping information so fast and, that by the time an ordinary customer has finished typing in their 16-digit credit card number and billing address, a customer with an ATC service has already successfully checked out, or “jacked” their cart. Retailers consistently claim to be working to stop the efficacy of bots, but release after subsequent release show that even sites as large as Foot Locker simply cannot stay ahead of the ATC developers. It doesn’t stop with sneakers either, large brands like Supreme and Palace see the same thing happening. A Supreme box-logo hoodie (yes, a sweatshirt that simply has an embroidery with the brand’s name) can retail for around $150 and will sell on sites like Grailed for four-times that amount within a few hours of the posting.
A question that I have struggled to answer for myself, even in the context of my single pair of Yeezys, is the whether or not it is fair to use these methods as a means of making money. The answer that I have been able to come up with is a resounding “maybe.” I’ve realized that the reason why everyone cannot get a pair of coveted sneakers or a hoodie is not due to the fact that full-time resellers are hoarding them, but rather because the supply does not meet the demand. Regardless of whether someone like Kuo buys all 1,000 pairs of a hyped release or if 1,000 distinct purchasers are able to buy them, the resale market will still exist and sellers will still actualize greater gains on a pair of sneakers than even some of the riskiest stock options. Sure, some people may be able to purchase a pair of shoes that they intend on keeping if bots are banned. But, I am sure that there are plenty of people like me who can’t turn down a quick buck. I could go into the intricacies of a marginal-benefit / marginal-cost analysis, but in the end all that will show is that even though there are some people who are barred from the secondhand market because of their willingness-to-pay, markets will still clear and retailers really have minimal incentive to do anything about bots and plugs.