06.02.2024 | by Lili
Refurbished products, especially in categories like electronics and household appliances have been in trade for a long time. Nowadays, with increasing consumer demand for a more ecologically conscious global commerce, the trade of refurbished products is rapidly rising.
But what exactly are these products and how can their trade contribute to saving the environment?
Although there’s no commonly accepted legal definition, the term “refurbished” is used for any product that has been purchased by an end-user and then returned to the seller or manufacturer for any reason.
As you can see the term is quite broad: it includes gifts brought back to the shop soon after purchase because the recipient already had one or didn’t like the colour, as well as defective products returned for repair within the legal warranty period.
Whatever condition products are returned in, however, sellers and/or manufacturers are generally required to check them for faults, repair them if necessary, and offer them for resale at a reduced price with full disclosure of their history.
There’s a very important difference between second hand and refurbished products. While all of them have been pre-owned, second hand products may not have been checked for faults whereas refurbished products undergo a process of testing and repair. Also, with refurbished products, customers can count on some kind of warranty and/or further repair services, as they’re buying the product from an official seller.
Together, the trade of second hand and refurbished products are referred to as recommerce.
Since refurbished products are sold at a reduced price, consumers can save money while still purchasing a tested and fully functional product. As for the environment, the advantages are even clearer.
Instead of being thrown away, refurbished products get another chance at life, thus diminishing the amount of waste accumulating in landfills. And let’s not forget that selling refurbished products en masse reduces the need to manufacture new ones, saving resources and curbing pollution.
With consumers, especially younger generations, pushing for more eco-friendly economies, it’s no wonder that the trade of refurbished products is soaring. A recent study predicts that the market of refurbished products, currently worth around $107 billion, will double its size and reach ca. $262 billion by 2026.
As Dr. Tim Seewöster, Managing Director of refurbished and second hand marketplace Asgoodasnew, put it: “We see a rising trend for more eco-friendly commerce, especially amongst young people. Here, refurbished is the new organic.” (translated from German by globaleyez.)
According to Dr. Seewöster, brands and retailers have to adapt their operation to these new consumer requirements and become more sustainable. This may even include providing refurbishment services themselves, which allows them to cut out the middlemen and save unnecessary costs.
With this increasing demand for recommerce, brands need new solutions to facilitate the trade of second hand and refurbished goods. Marketplaces like the aforementioned Asgoodasnew as well as Vinted and even eBay are certainly helpful, but what if your brand wants to retain control over your resales? Luckily, you’re not on your own.
Trove, for example, is a provider offering “branded resale at scale.”
Screenshot of trove.com/who-we-are/
The company offers brands the chance to enter the omnichannel-retrade with trade-ins, reverse logistics, commerce solutions and data analytics.
As an alternative solution, brands may try to do it on their own, or enter into partnerships with retailers to enable their recommerce operations. Zara Pre-owned, for example, is a branch of the popular Spanish fashion retailer that handles the recommerce of its garments. WornWear by Patagonia works on a similar principle, as well as Re-Supply by REI.
Momox, on the other hand, approaches the issue from the side of consumers. The Germany-based online marketplace buys pre-owned items, including clothing, books and electronics from end-users and sells them again on its platform.
Preparing refurbished and second hand products for resale is not without its unique challenges that brands and sellers should be aware of.
As Stefan Klostermann, Chief Commercial Officer for Books and Media at Momox remarked, “One of the biggest challenges of recommerce is getting products quickly and efficiently through quality control, including the exact identification, sorting and condition check of products.” (translated from German by globaleyez.)
Now, thanks to several AI-based tools like smart image recognition software, this process can become much quicker and more efficient. AI applications can significantly diminish the need for the manual sorting and handling of products, which makes them essential for enabling a more cost-effective recommerce.
Another challenge in the way of recommerce is shipping. With products coming from all over the place (instead of one single warehouse as is often the case in regular e-Commerce), some providers may find it difficult to employ a streamlined and cost-effective shipping solution that also lessens the burden on the environment.
Unfortunately, recommerce also poses unique challenges for your brand’s IP rights.
With consumers as well as recommerce operators active in selling pre-owned goods, you may find your products handled and sold by people you’ve not authorised to do so. Similarly, some providers may take advertising into their own hands, using your copyright protected images without your permission. And let’s not forget the issue of fake products re-entering trade and causing problems for you all over again.
Luckily, we have very good news: We already have solutions for these problems, and many more.
Image monitoring provides an excellent basis for detecting IP infringements in recommerce. Our powerful software, infrimage combs through the internet, checking for unauthorised use of your copyright-protected images. With infrimage you can find both exact matches and similar pictures shot by fraudsters anywhere online.
Marketplace monitoring, on the other hand, provides keyword-based monitoring on over 150 marketplaces worldwide. We can check any keywords like your brand name, product name, or anything else fraudsters may be using to lure customers to themselves.
Once we have our suspects, a test purchase is the logical next step to find out more about the origins of the product and the seller. It’s also indispensable to determine if the product in question is counterfeited or original but sold outside of your authorised distribution network (= grey market.)
If we suspect that the product originates from an authorised seller, distributor or any other business partner of yours who disregards your contract terms, we suggest a round of compliance checks. This service helps you find out if your business partners honour your contracts, or if they act against your terms in any way, i.e. selling your products on unauthorised marketplaces.
The culmination of our services is the enforcement of your rights, where we demand the removal of the infringing content from the internet. This includes marketplaces, social media platforms, single webshops, domain registries, or any other spot we came across the infringing content.
Recommerce is an emerging trend that seems to be beneficial for consumers, brands and the environment alike.
Don’t let its inherent challenges stop you from entering recommerce! Contact us and let us take care of the safety of your IP rights so you can concentrate on all the opportunities recommerce provides for your brand.