The Guangdong Entrepreneur Selling Second-Hand Clothes to Africa: A Story of Success

 Embrace Your Authentic Self, and the World Will Reward You.

Guo Song (The well-known name in the business is MR.Song)

Recently, the story of Wu Kais thought-provokingly capturing attention with the headline “Law Graduate Achieves Financial Freedom through Recycling” showcases the belief that everything has value. Another inspiring figure in this realm is Guo Song, a young entrepreneur from Guangdong who dove into the second-hand clothing industry in 2012 by founding Guangzhou GRACER Recycling Resources Co., Ltd.

After more than a decade of growth, GRACER has become the largest second-hand clothing exporter in China, processing tens of thousands of tons of clothing each year with revenues exceeding 400 million RMB. Remarkably, around 60% of this volume is exported to Africa, while the remainder reaches Southeast Asia, Europe, and America. “There’s no such thing as waste — only misallocated resources,” says Guo, beaming with pride as he sees high-quality second-hand clothes from China worn by people in Africa.

Turning Waste into Wealth

Born in Maoming, Guangdong, Guo Song enrolled in the Administration program at Guangdong University of Foreign Studies in 2008. His early awareness of career planning is evident from an interview with his alma mater. From reading widely and joining clubs in his freshman year to focusing on his major in his third year, Guo consistently directed his own path.

His connection with recycling began in his sophomore year when he noticed military training uniforms piling up in dormitories after a new student orientation. “They’re worn once and discarded. What a waste! Can’t we find a way to recycle them?” Motivated by the potential to fund his student organization, Guo borrowed money from classmates, collected military uniforms from various universities, and sold them to local training centers, earning his “first bucket of gold.”

Guo then launched the “Angel Action” university alliance, encouraging participation from 50–60 schools to recycle clothing. A portion of the collected clothes was donated to children in rural western areas, while the profits helped sustain the alliance, which continues to operate entirely on a non-profit basis today.

As graduation approached, Guo considered seeking employment and spent a month polishing his resume. Ultimately, he decided to pursue entrepreneurship in second-hand clothing recycling, co-founding GRACER. “The circular economy holds tremendous potential!” he asserts.

Despite China’s abundant supply chain for second-hand clothing, the cultural preference for new over old means most of the market lies abroad, particularly in Africa. As GRACER’s General Manager Li Wencai discovered during a visit, “Most Africans earn between $50 and $100 a month. Only 10% can afford new clothes; 50% can buy second-hand, while 40% can’t afford even that.”

According to UN trade data, global second-hand clothing exports surpassed $5.4 billion in 2021. Statista predicts the global second-hand clothing market will reach $84 billion by 2030. Within this rapidly growing trade, Chinese second-hand clothing enterprises have made a significant impact. In 2016, China ranked fifth globally in second-hand clothing exports, totaling 218 million RMB. By 2020–2021, exports to Africa surged by 123%, making China the leading supplier in Africa and Southeast Asia, overtaking Western nations.

Despite their higher price compared to second-hand clothing from Europe, America, Japan, and Korea, Chinese second-hand garments stand out due to their variety, quality, and fit for African consumers.

From China to Africa

So, how does a second-hand garment travel from Chinese households to the people of Africa?

Before reaching the international market, these garments typically end up in waste bins or community recycling boxes. They are collected by sorting companies, disinfected, sorted, and then sold to second-hand export companies. After classification based on quality, type, and seasonality, they are compressed into bales for shipping to Africa. Local agents then distribute these clothes to towns and villages across the continent.

“A quality second-hand T-shirt sells for about 5–10 RMB, whereas a new T-shirt of similar quality can cost several times more,” Guo notes from his market research.

In its first year, despite the nascent domestic second-hand clothing industry, the GRACER team managed to collect 2,000 tons of clothing and export it through Alibaba’s international platform. By 2014, when Li Wencai joined, they were handling 10,000 to 20,000 tons annually.

While many local enterprises focus on just one or two aspects of the industry, Guo aimed to integrate the entire supply chain, believing it essential for creating a genuine circular economy. “This approach reduces costs and maintains quality control.”

Today, GRACER operates 30,000 self-service recycling bins nationwide and utilizes online platforms like Alipay and Xianyu for collection. “We don’t reject clothes just because they’re damaged; that contradicts our environmental principles,” Guo emphasizes.

In GRACER’s factories in Guangzhou and Shandong, over 600 workers sort, disinfect, and package garments daily. They separate wearable items from those that aren’t, ensuring even unusable garments are not wasted — they are sold to downstream companies as industrial raw materials or transformed into new fabrics and materials.

“We aim to utilize every resource fully,” says Li Wencai.

Overcoming Challenges

Guo’s steadfast commitment to the circular economy has not been without its hurdles. The rise of companies using charity as a façade for profit diminished public trust in clothing recycling, leading GRACER to expand its collection network in 2017. However, overestimating the domestic market’s maturity, the company lost over 20 million RMB in two years.

Simultaneously, GRACER invested heavily in developing new materials from non-wearable clothing. Although they succeeded in creating items like automotive sound insulation and industrial cleaning cloths, market acceptance for these new materials remained low.

“Taking one step forward makes you a pioneer; taking too many can make you a martyr,” Guo humorously reflected later.

Due to significant losses, GRACER had to temporarily retract its northern collection network and outsource new material production. It wasn’t until 2020 that government support for the second-hand clothing industry began to materialize, allowing GRACER to thrive.

During GRACER’s expansion phase, the team debated establishing a local presence in Africa. Ultimately, Guo decided to set up the first overseas station in Uganda, but two years later, it collapsed, prompting a full withdrawal back to China.

“Challenges included manual operations in pricing, warehouse management, and currency exchange, leading to difficulties in regulation. Additionally, the lack of a compliant business environment in Africa made it hard to register companies. Life was monotonous for employees, with some even frequenting casinos,” Guo explained in a HardKear interview, highlighting the strain on their team.

Nevertheless, Guo has not completely abandoned the idea of returning to Africa. He acknowledges that for any overseas enterprise, local integration is crucial. “Once we fully digitize our domestic operations, I don’t rule out the possibility of expanding overseas again,” Guo concludes.

(End of Article)

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