When a seller comes to sell their bag on Value Creation UAE, their primary concern is not whether the bag will be sold or not. 

In fact, they are more worried about them not being underpaid for it. 

They are concerned about not getting scammed or rushed into making a decision. 

The majority of sellers presuppose that underpayment occurs due to the unfairness of a buyer. In most cases, it occurs because the seller does not understand how pricing works in the resale of luxury items. 

It is the sellers’ unrealistic expectations and low market logic that result in value being lost. 

The Real Meaning of Being Underpaid

Let us first understand the actual meaning of “underpaid.” This is the biggest misunderstanding.

The fact that you are underpaid does not simply mean:

• Receiving less than the retail value.

• Getting less than what you had paid.

• Getting less than a random estimate.

Underpayment actually means:

The amount of your ultimate payout is less than what the bag could have attained otherwise. However, simultaneously considering its current condition, the time, and the market route.

These factors really matter since most sellers do not take good early offers. They sometimes wait too long and then are left with no choice but to accept poor terms. 

The First Disconnect: How Sellers Think vs How Buyers Act

How sellers usually think

• "This bag is quite high-priced."

• “The bag's condition is still quite good."

• “Other online listings are priced higher.”

• "I’ll wait a little more. I can get more."

How buyers actually act

• Only concerned about money; feelings do not matter to them.

• Refer to sales’ statistics, without asking price.

• They presume that negotiation will happen.

• Their demand for discounts is based on their spending time and effort on this transaction.

It is the gap between a buyer’s and seller’s expectations that leads to this discrepancy and value being lost. 

Translation Block: What Feels Like A Low Offer To You

What sellers think:

“They are making a fool out of me and being unfair to me.”

However, the purchaser in actuality is just accounting for future negotiation, resale friction, and the associated risk. 

This is standard behavior of any buyer, be it any market.

The Hidden Math Most Sellers Don't Do

This step is where a majority of the sellers lose control over negotiations or the outcome.

They do not pay attention to net payout, but in fact focus solely on headline numbers. 

A simple example:

• Bags sell at a rate of 70% of retail value.

• The platform on which one is selling keeps a commission of 40%.

• 3-5% is consumed as fees for payment and service.

Therefore, the amount in hand for the seller at the end of the sale is 40-42% of the retail value. 

This is the very mismatch that we elaborate on in our guide to selling designer bags without making errors.

Decision Tool: How Selling Method Changes Your Outcome

Insight:

Sellers would definitely think they are underpaid when they take a slow path and do not realize the math behind the payout.

Why Waiting Often Makes Things Worse

Most initial offers received by sellers are not considered. 

In such offers, they are being offered 65-70% of market value, and sellers do not address them in the hope that waiting will help them achieve a higher payout.

However, what normally occurs in such a case is:

• Interest rates fall

• Depending on platforms, markdowns are triggered.

• Buyers benefit from this delay in sales.

• The eventual offer that is accepted is lower than what was initially offered.

This is a cycle that we observe on every occasion, particularly on non-iconic bags. 

Check out this article for further understanding and comprehensive guidance on luxury bag shopping. 

Bag’s Condition: The Silent Price Compressor

Value is lost immediately if the condition of the bag is bad. 

10-20% of the price will be reduced if the bag downgrades from “excellent” condition to “very good.” 

Moreover, sellers often exaggerate when it comes to the condition of the bag. They also miss structural or odor problems, and this is greatly looked down upon by buyers. 

To understand how much buyers place importance on bags’ condition, give a read our complete breakdown of condition and luxury resale pricing. 

Where Expectations Mess Up

Luxury brands do not all perform the same on resale. Let’s see how different brands perform differently when it comes to resale.

Hermes & Chanel 

• Demand is high.

• Rates very much depend on the condition of the bag.

• Not much room for negotiation.

Louis Vuitton 

• Pricing usually needs to be sharp.

• Lots of variety for buyers.

• Dependent on volume.

Trendy items

• Price and value fluctuate. Usually, the value goes down quite quickly.

• Delaying as usual does not help much.

Due to reasons mentioned above, sellers often perceive and value their items at a higher amount, but then get disappointed when they actually sell off at a lower rate.

This is further explained in our article "Best Designer Bags to Invest In." 

Packaging, Repairs, and False Confidence

Underpayment is the result of two assumptions:

“I own and am willing to sell a complete set, hence I should receive more.”

Packaging does not immediately result in a bag getting priced high. 

“I will fix it so that I can demand a higher price.”

Professionally restoring the bag will only work if the ROI is as expected. In fact, unrequired restoration often just results in suspicion.

To read more about this, check out “Is it worth repairing a designer bag before selling?”

Dubai-Specific Reality Sellers Miss

They:

• Are well-informed and price-conscious sellers.

• Value authenticity.

Dubai sellers in the second-hand luxury goods market often do transactions at 30-70% below retail value. This is the on-ground reality.

Charging an overprice only results in silence.

Micro-Framework: How to Protect Yourself From Being Underpaid

To avoid being at a disadvantage, follow these steps:

• Understand the category in which this resale bag fall. 

• Value the bag realistically, not emotionally.

• Choose the selling route wisely.

• Focus on the net amount, not gross. Gross includes the fee cost as well.

• Initial offers are often the best ones; do take them seriously.

Conclusion

Avoiding being underpaid isn't about pushing harder.

It's about understanding:

• The buyers’ perspective.

• The platforms’ cost.

• Time is crucial.

Underpayment is simply a result of your expectations being higher than the value of the bag in reality.