Recommerce (AKA reverse commerce) is the process of repairing, refurbishing and reselling (or recycling) pre-owned products. Beyond the environmental benefits, creating an in-house resale or exchange platform can have big benefits for a business: strengthening brand image and giving access to a whole new set of customers who either can't afford – or don't want – to buy new. Plenty of resale-as-a-service brands (like Treet, Faume and Reflaunt) have popped up, ready to run a brand's whole resale operation, handling inventory, shipping and payments. We spoke to Stephanie Crespin, founder of Reflaunt – which runs recommerce for fashion brands like Balenciaga, NET-A-PORTER and Ba&sh – to find out what businesses need to know before getting involved.
How do you know if recommerce is right for your business?
‘First and foremost, you need to find out whether there's already a big secondhand market for your products. If there is, then this is an opportunity. If not, you should consider investing your efforts into another part of the business that tackles sustainability. There'll no doubt be other parts of your operation and supply chain where wastage can be reduced.’
Is it easy to set up a recommerce channel?
‘The biggest mistake people make is thinking it's going to be less work than it is. Recommerce is complex because you need to reverse-engineer your existing distribution networks.
Theoretically, this means setting up new distribution channels so you can collect, refurbish and resell pre-owned products. In practice, this amounts to organizing drop-off points, contacting repair shops and creating a resale platform on your website. The costs can add up quickly. Whatever happens, if you're going into resale, be ready to rethink your customer experience.’
What are the basics you need in place?
‘A record of purchases your customers have made will make life easier when it comes to identifying the legitimacy of pre-owned products. If you sell your products offline, keep some kind of record. If customers want to list items on your marketplace, their experience will be a lot smoother if you know who they are and what they purchased. You should have a thorough vetting process in place every time an item is listed to safeguard users. Also bear in mind that if customers are listing pre-owned items on your website, you're responsible for the quality. Finally, make sure recommerce is adding value to the existing service – like providing credits to customers who send back their items, instead of cash.’
How do you decide whether to refurbish your items?
‘If items need to be refurbished, this is going to be a big cost to you as a business. Reflaunt mostly advises fashion brands to stick to resale, because refurbishment isn't as financially viable as in other industries, like electronics. If you go down the refurb route, it's best to outsource this procedure to a company that specializes in refurbishment.’
How much can it cost?
‘Our fees to run your platform start from €1,000 per month but can increase to a couple of hundred-thousand euros, depending on size, traffic, listing and sales. Set-up costs for your own resale platform can be considerably higher than the running costs if you decide to create an elaborate resale site within your existing website.’