The resale of Hermes bags, brand-name jewelry and other luxury items is a thriving industry in Japan, with one critical bottleneck: Building inventory is tough.

Sou Inc. offers a solution: pawnshops dedicated only to buying up secondhand merchandise. Business has been so good for founder Shinsuke Sakimoto ¡ª who posted profit of ?1.14 billion ($11 million) on sales of ?22.7 billion for the year ending August ¡ª that he¡¯s taken the company public.

Shares of Sou opened for trading in Tokyo on Thursday at ?4,100 a share, 24 percent higher than the IPO price of ?3,300, before closing at ?3,900.

The national resale market for luxury brand goods is worth almost ?200 billion, according to a government report. Yahoo Japan Corp.¡¯s auction website is dominant, but there¡¯s plenty of competition. Mercari Inc. became Japan¡¯s first startup unicorn with a marketplace app, and even eBay Inc. is returning to the market. With plenty of demand for secondhand goods, Tokyo-based Sou has focused on making it easier for people to part with their expensive bags, watches and jewelry.

¡°We are specialists in purchasing other items; we do not sell them,¡± Sakimoto, 35, said in an interview. ¡°Other companies will open stores to sell the items they buy as an exit. We are B-to-B, so we use auctions to say ¡®bye-bye¡¯ to the items in a short amount of time.¡±

The company, named after the Chinese character for ¡°thought,¡± has a network of 57 stores across the country. They¡¯re stylish, attractive locations where people can sell their used luxury goods in a relaxed atmosphere. Sou is planning to open more stores, funded in part with the sale of ?4.9 billion worth of shares. The company, which is trading on the TSE¡¯s Mothers section, has a market cap of about ?24.5 billion. SMBC Nikko Securities is the underwriter of the IPO.

Sou doesn¡¯t rely on much technology or smartphone apps. It has a bare-bones website. The company¡¯s growth, according to Sakimoto, comes from its ¡°ability to round up customers, to purchase the goods, and then sell them off quickly.¡± For the fiscal year ending in August, the company expects sales to increase 31 percent from the year-ago period.

Still, Sou will be wading into a crowded market where consumers will have their choice among websites, smartphone apps and Japan¡¯s already built-out network of pawnshops for how they want to sell their items.

Sakimoto says it¡¯s impossible to know when an item will see less or more demand. So once Sou buys used brand-name goods from customers, it auctions them off to other businesses four times a month.

The next stop could be another city in Asia. Sou is also considering a location overseas, and has previously held auctions in Hong Kong to sell diamonds.