Challenges

Buy-back as alternative: A few examples

A few stores are experimenting with buy-back programs as a way to incentive return of used products no longer needed. The companies either recycle, refurnish or resell the products.

The programs are becoming more popular because companies are realizing that giving a small financial incentive like 5% or $20 off a new purchase drives users to spend more at the stores. In addition, companies make a small profit by re-selling the raw material back to manufacturers. 

Users in turn benefit from knowing their old product will not go to waste, and from the financial incentive. Overall this is a win-win experience.

It would be nice to see more brands doing it.  These are some of the examples I found:

Mass Save: offers $75 back for returning used refrigerators https://www.masssave.com/en/shop/recycling/refrigerator-and-freezer-rec…

Apple buy back: https://www.apple.com/shop/trade-in

Best Buy has a trade in program: https://corporate.bestbuy.com/trade-recycle-old-tech-enjoy-new/

Eileen Fisher claims to take lifetime responsibility for their clothes) https://www.eileenfisher.com/renew

John Lewis piloted a buyback of clothes, sofas, matreses and appliances. It even helps coordinate product pickup: https://www.theguardian.com/business/2018/jun/18/money-for-old-socks-jo…

Comments (4)

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What can go wrong?
Madalina Radoi
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  • Would schemes like this launched by large retailers not disadvantage smaller (local) charity shops?

    What can go wrong?
    Maria Chercoles
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  • Hi Madalina, you raise a very good point. In fact, I heard that thrift and second hand shops have been against buy-back programs exactly for that: It makes their business obsolete. However, as society moves towards a circular economy model, all businesses will have to re-invent themselves and find a way to be relevant. If people are no longer owning their appliances and clothes, or they're holding on to them for life, then it's likely that thrift shops will go out of business because their business model depends on people getting rid of things they own to make room for new ones. However, those small shops have the opportunity to change their role and business model. An idea could be to become collection, repair, buy-back or refurnish centers for larger manufacturers that don't have a local presence. I have to doubt that the circular economy will disrupt a lot of industries. To survive, businesses will have to change and start considering how can they benefit and bring value in a new circular mindset, instead of stay attached to the old way of doing business.

    What can go wrong?
    Isadora Ruiz Dias
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  • I like the idea of sending products back and the companies have to deal with their own products at the end of life, and I also understand that if there is some type of incentive for the consumer to send it back, it is probably more successful than relying only on the consumer´s conscience to send it back.

    However, I wonder if the solution is to give discounts, to buy even more products. I guess this still reinforces patterns of consumption that we should try to disrupt? Just a thought that constantly goes through my mind when I think about possible business models.

    Maria Chercoles
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  • Hi Isadora, you raise a good point. Buy-backs is an incentive for customers to get out of their way and return things they might otherwise just throw away, but it could trigger more consumption. While it might work in the cases where the user definetly needs a new product and plans to buy it no matter what, for example a broken phone, it could generate more consumption in other industries such as fashion. It's not perfect, but it's just a way to motivate returns. An alternative to giving incentives to buy a new product is charging an extra amount at the time of the purchase that's returned to the customer when the product is returned. An example of this is how bars and clubs in Berlin charge 1€ extra for each beer bottle and they return the 1€ when the empty bottle is returned. Bar and clubs want to keep empty bottles off the floors and also make sure they're recycled properly, and this system is very efficient at it.