Supreme.

You’ve heard of it, and you’ve seen it in its purest form, the red box logo. A symbol commonplace thanks in part to the stickers provided by the company. You’ve seen it plastered on laptops, cars, and most importantly, clothes. The symbol, an iconic manifestation of New York skate culture, has allowed the brand to become easily identifiable, and consequently, extremely popular.

It’s a brand that everyone knows, but in reality, so few own.

So why is Supreme a billion-dollar company?

The company, which was established in 1994, has evolved into the pinnacle of international “streetwear”. Founded with the purpose of providing unique, skate pieces, it has since transformed into a self-proclaimed “world famous” clothing enterprise.

Supreme’s popularity can be traced to one single aspect, exclusivity.

This hype has inspired two approaches to the brand. The first is to wear, and the second is to sell. The latter often convinces hundreds of people to line up outside of their nearest Supreme store. Since there are only eleven locations globally, many must resort to their online marketplace.

Each Thursday marks the release of new Supreme items, ranging anywhere from flannels to fire extinguishers. The drops sell out in seconds, forcing those who can’t buy the items, to pay above retail price. This cycle of buying and selling creates an endless loop of publicity for the brand. A shirt sold for 38 dollars is then listed for a much higher price. Like with anything else, people continue to follow the trend of wanting what they can’t afford.

For most, the clothing that they purchase will be listed on eBay or another similar service. From there, the clothing is marked up at exponential rates. Those who aren’t able to buy the clothes fast enough, or those in a location outside of Supreme’s shipping umbrella, must resort to re-sellers.

This new pricing results in two consequences.

First, the clothes appear to be rarer than they are. Many sell the garments overseas, resulting in a wider distribution of Supreme merchandise. This makes the probability of seeing two people wearing the same Supreme item, nearly zero. In addition, reselling attracts a new level of consumer. Those who may have looked down on a 30-dollar shirt are more willing to shell out 150 on it, assuming that price is equivalent to quality.

Besides the ridiculous re-pricing, the company limits its own releases, producing only a set amount of each item.

This combination of rarity and luxury pricing has resulted in Supreme’s overwhelming popularity.

This pattern of buying and selling is responsible for Supreme’s one-billion-dollar evaluation, a price cemented by the investment firm The Carlyle Group. The organization, which recently purchased half of Supreme for 500 million dollars, is the largest private equity firm in the world. With this support Supreme can expect even larger growth, propelling them into an even bigger market.

At this point, the only thing holding Supreme back is the emerging counterfeit market. The logo, which is extremely easy to replicate, along with extreme re-sell pricing, drives many to purchase unauthentic replicas.

When an authentic blue box logo Supreme T-Shirt sells for over 200 dollars on eBay, can you really blame them?