Second-hand as a new economy: used clothing is changing business, culture, and tax policy in Ukraine

This year, second-hand in Ukraine ceased to be just a budget option for those looking for cheaper clothes. He pond a full-fledged market segment that shows stable growth every year. Today, used things are not a shame, but a style, a trend and a real business with millions of copies.

During the three war years, the number of second-hand shops increased by 25-40%, and now they cover at least 11% of the entire domestic clothing market. These are hundreds of chains across the country that serve thousands of customers every day. And although most of them are small points or outlets, the most successful turn into full-fledged business networks. If you correctly build a system – with several stores, constant product rotation and the right markup – you can earn millions, or even billions of hryvnias a year.

This market has long been about more than poverty. Young people, eco-activists, fashionistas and those who choose conscious consumption have turned the second-hand shop into a platform for individuality and a new fashion ethic. People buy things here not because there is no money for new ones, but because it is stylish, smart and responsible. In addition, this trend is supported by global players: IKEA, Levi’s, Zara already are launched own platforms for the resale of things, supporting the principle of reuse as part of the corporate strategy.

But second-hand is not only about trends, but also about a real chance to open your own business. You don’t need hundreds of thousands to start a store. According to entrepreneurs, it is enough to invest about $200 in the first batch of goods. These funds will go towards the purchase of one bale of used clothes. Next, rent a small space (from $250 to $500), advertise in social networks and design a storefront. And this is enough to start.

The profit is more than real. If everything works as it should, the store can open in a few months bring about $3000 net profit per month. The most successful ones open a second or third point, automate accounting, launch online sales. And then scale up.

In this business, the main thing is not just to have a product, but know, what exactly the client will be looking for. Men’s or women’s clothing? Children’s things? Brands or vintage? Success depends on the correct positioning, an attractive window, a clean hall and a well-thought-out system of discounts. People should come not just to buy a sweater, but to find “something cool” — and leave with a bag of things and a desire to return.

And don’t underestimate marketing. Currently, most customers will come in a second not from the street, but from Instagram or TikTok. Photos of interesting finds, live broadcasts with unpacking of bales, stylish bows made of things “for 70 hryvnias” — all this works better than any billboard.

Even ten years ago, “second hand clothes” sounded like something that should not be advertised. Now that’s a reason to be proud. Young people and even stars directly say that they wear second-hand items.

Two out of three Ukrainians buy secondhand goods because of the price-quality ratio, and 38% to be able to afford branded items. Among Gen Z, second-hand clothing is a way of expressing yourself, not a compromise.

Social networks became the impetus for a new wave of interest. In TikTok, videos with the hashtag #secondhand gain millions of views. Young girls and boys share their “catches”, organize fitting sessions, tell in which stores you can find Prada clothes for UAH 120 or leather jackets for the price of a T-shirt from a mass market.

Stylists caught the wave. One of them — Andriy Popov — stated, that “bomzhatsky style” can look stylish if you put together the image correctly. And that the second-hand market is a platform for the most daring fashion experiments.

Even Vogue UA includes a second to their trend digests – this year they wrote which five things from a second will become the hits of the season.

This year, second-hand buyers are hunting for vintage 80s and 90s — jeans, bombers, neon, hyperbolized shoulders, branded streetwear — Champion hoodies, Nike jackets, Adidas oldschool t-shirts. Utilitarian items are in demand – cargo pants, shirts with large pockets, puffer jackets, graphic t-shirts with prints of Van Gogh, Mozart or even Mariah Carey, as well as oversize jackets in the style of men’s suits – often in the men’s department

In the selection of trends, these things are not only fashionable, but also help to look “expensive” for affordable money.

Yes. It has long been more than just a way to save money. Buying things that have already been used is a way to avoid overproduction. The global fashion industry is one of the five most polluting industries, and second-hand clothing really reduces the amount of textile waste.

Choosing used, you reduce carbon footprint, do not support fast fashion and do not finance corporations that sew clothes in factories that violate human rights.

What is the difference between “cream”, “extra”, “stock” and “mix”?

Recently, domestic second-hand turned into to a powerful industry with extensive logistics, a clear sorting system and a wide range of suppliers. Understanding the sources of supply, logistics processes and product classification is key to running this business successfully.

The main suppliers of used clothes for Ukrainians are Great Britain, Germany, Italy, Canada and the USA.  The second-hand delivery process includes several stages. Clothes are collected through charities, collection points or specialized containers. At specialized factories, clothes are sorted by quality, type, season and other criteria.

Sorted clothes is being packed in bales or bags according to categories. In Ukraine, second-hand goods are classified under the UCT code of ZED as “other ready-made textile products, sets, clothing and used textile products”. The goods are transported to warehouses or directly to stores throughout Ukraine.

Second hand is shared into several categories depending on the quality and condition of the clothes. The highest category, which includes new or almost new items, often with tags, is the so-called Cream. It is followed by Extra, a high-quality garment with minimal signs of wear.
An order of magnitude lower is grade 1, i.e. things with minor defects or signs of wear, but suitable for sale. Then there is the 2nd grade – clothes with visible defects or wear and tear, which are usually sold cheaper.

A separate category is stock – new clothes that are not was sold in stores, often with labels. Finally, there is a mix — a mixed assortment of clothes of different categories, types and seasons. These categories help entrepreneurs to choose an assortment based on the needs of the audience.

Although most suppliers adhere to proper quality standards, there are certain risks associated with the product. In particular, these are risks of a hygienic nature: bacteria or mold may be present on clothing. It is also possible that the category does not match, when the product is marked incorrectly or does not meet the declared characteristics. Also, things can be damaged or contaminated during transportation.

To minimize the risks, it is worth cooperating with proven suppliers, carefully inspecting the goods upon receipt and observing hygienic standards when processing clothes.

Second-hand in Ukrainian: business model, taxes and the struggle for the future of light industry

Dealing in second-hand today is not just a fashion trend, but a full-fledged business. But in order not to run into problems with the tax or customs, you need to know how to properly file a case. In fact, everything is not so difficult – the main thing is not to neglect the legal details.

To open a store with used clothes, you must first register as an entrepreneur. The easiest way is to become an FOP (individual entrepreneur) if you start with one store. If you have ambitions to create a network, it is better to form an LLC.

Enough for a start register FOP, choose a simplified taxation system and indicate the corresponding KVED — 47.79 (retail trade of second-hand goods).

A license as such is not required, but a mandatory package of documents includes a lease agreement for the premises, documents for the cash register (if you plan to use it) and a certificate for the sanitary treatment of the goods. It is also important to have accompanying documents from the supplier: invoice, packing list, disinfection certificate — all this is needed not only for customs, but also to avoid accusations of “smuggling”.

Experty advise work with legal importers who can provide a complete package. Otherwise, everything can “hang” at the border for months.

If you are importing things from abroad, there must be confirmation that the goods have been disinfected and do not pose a health risk. In most cases, this is done by the importer, the factory that sorts and packs the bales. But in the case of retail sales, you must have copies of these documents on hand. Domestic legislation does not require certification of each thing, but there must be a general document about the origin and processing of the batch.

Second hand is imported to Ukraine officially, through customs, with UKT code ZED 6309000020. This means: “used clothes”. It is under this code that taxes are paid: VAT, customs, and in some cases excise. Here it is important to draw up the contract with the supplier, the invoice, the packing list and the disinfection certificate correctly
To avoid unnecessary trouble, it is better to work with Ukrainian wholesalers who have already imported the goods, cleared customs and have all the documents. It’s a little more expensive, but without the headache. Especially at the start, when every fine can hit your pocket.

To bring a second-hand car to Ukraine officially, you need to go through customs clearance. In 2025, fixed so-called “input prices” are in effect – this is not the real cost of clothes, but a customs assessment, from which counts duty and taxes. Yes, for goods from the EU it is 14.78 euros per kilogram, for Great Britain – 15.46 euros per kilogram.
This means that the customs can “value” a bale weighing 100 kg at one and a half thousand euros – even if in reality the supplier sold it for 300. It is from this amount that VAT and customs duties are calculated, and this often creates a headache for entrepreneurs.

Ideas about the banning of seconds in Ukraine are not a myth. Already last year, the government considered options for strengthening control over the import of used clothing. Options include capping at a minimum price, additional licenses, or even paying a tax per unit.

Government is afraid, that second-hand has become too cheap, and legal importers of new clothes, manufacturers, and even the budget suffer because of it, because the business is in the shadows.

All this is still talk. But the trend is obvious: the state wants to strengthen regulation. And here begins the most acute part of the discussion. According to the representatives of “Ukrlegprom” – the association of Ukrainian manufacturers – more than half of all clothes that enter our market are second-hand.

This means: instead of buying things from Ukrainian factories, people go to second-hand clothing stores en masse. As a result, the industry annually loses up to 45 thousand jobs. By volumes import of second-hand goods Ukraine is in third place in the world.

Manufacturers insist: it is difficult to compete with second-hand goods, because new things are more expensive, and the tax burden on business is higher. As long as the buyer is looking for jeans for UAH 120, Ukrainian production cannot withstand competition.

This conflict of interest is key. On the one hand, Ukrainians have the right to affordable clothing, especially in wartime. On the other hand, the economy needs jobs and domestic production.

Currently, the question is more relevant than ever: how to find a balance? How to preserve the advantages of second-hand goods without destroying the light industry?

There is no answer yet. But one thing is clear: second-hand in Ukraine is not just things with a charity label. These are economics, politics, culture and the struggle for the future of the market.

Tetyana Viktorova