Are you struggling to break into the refurbished technology market and can’t pinpoint the problem? Perhaps you’re looking to begin targeting this market and want to prepare for potential challenges you may face.
Failing to be aware of the factors the refurbished market faces to succeed will impact your progress.
Ingram Micro Lifecycle is an accredited and OEM-certified reverse logistics partner. We specialize in the lifecycle extension of technology products, including high-end consumer electronics, Small Domestic Appliances, IT assets, and mobility devices. Our mission is to enable a circular economy for these product categories.
Within this article, we touch on four top issues identified within the market for refurbished technology and advise on how to tackle these challenges.
4 main challenges
The main four challenges can be split into two categories; supply and commercial.
Supply challenges of refurbished technology
1. Securing products
There’s a growing demand for refurbished technology, which is putting pressure on the market to ensure there are buoyant supplies to sate the demand.
The supply of these products is dependent on the supply of new products – when a new product becomes used and unwanted, it has the potential to become refurbished. Securing these used products and keeping logistics efficient are barriers to success.
To tackle this, trade-in schemes enable a direct source of preloved products. These create your supply channel so you have full control over inventory and get complete stock visibility. You can consider a repair and refurbishment partner, or a trade-in partner, who can manage parts of or the full process for you.
This partner will have the technical know-how to process used products and uplift the quality and function, recovering value and extending the lifecycle. A partner with extensive and innovative processes will have a higher yield to boost your supplies of refurbished goods.
2. Quality control
Keeping control and consistency of quality within the products being refurbished for customers can be an issue. Your customers will expect consistency between orders and transparency of the grades they’re purchasing. This is important to ensure repeat customers and high satisfaction.
If sourcing your products externally, you need a trusted provider that supplies high-quality goods. Repairs and refurbishment should use innovative techniques to deliver better results. Partners should also hold certifications and OEM accreditations to prove that equipment manufacturers have audited their processes and that everything generally is conducted compliantly.
Quality doesn’t stop at the product itself but extends to the packaging it comes in and the peripherals. Reboxing needs to factor in recycled or recyclable materials to ensure waste is minimized. The equipment required to use the product to its full potential can also be provided in a refurbished condition, for example, charging cables or earphones.
A partner can enable large-scale processing of repackaging as well as provide supporting equipment for boxing up with the main product and will manage the relationship with recommerce networks for seamless sales.
Commercial issues
3. Customer reassurance
Customers expect the same experience whether they're buying refurbished or new products. The product needs to be boxed and presented as if new, including all the necessary peripherals for use (as mentioned above). If it’s sold without certain peripherals, then this needs to be reflected in the price.
Customers need the same ease of collection or delivery as they’d experience with a brand-new product. The effort required to obtain the product should be equal to or less than the effort required to purchase brand-new products.
The end product purchased needs to meet their expectations for quality and function. Warranties on refurbished products are becoming more and more common, providing reassurance that the customer has protection should they experience any issues. Lifespan and reliability are among the top factors cited as concerns for choosing refurbished smartphones.
While a brand-new product would have to be in tip-top condition, there’s room for lower grades of products when selling refurbished. There’s a segment of the market that is happy to pay for high functionality but lower cosmetic quality products. These imperfections will be reflected in the price, giving them a lower purchase cost, which can be more desirable than receiving the highest-grade product.
Transparency on the product condition is essential so the customer knows exactly what they’re getting for their money. This accurately sets their expectations and reduces the risk of disappointment.
4. Visibility
The offer of refurbished products, alongside or instead of brand-new products, needs to be marketed clearly to the target market. Active promotion of these products can depend on your business type but may include an online sales website, positioning within physical stores, and outlets on marketplaces.
This offering needs to be clearly labeled in line with the transparency points we’ve covered above, to build trust in your offering.
Choosing a third-party partner to support these activities can help streamline the process. The partner should already have the experience and resources to set these up on your behalf. This increases the chance of success and enables you to be focused on your core business goals. You won’t have to diversify your team or split your resources any further to accommodate these new activities.
Tackle these four challenges today
Failing to deliver high-quality refurbished technology products to waiting customers that meet their expectations will lead to a poor reputation, low customer retention, and a high rate of returns. Partnering with a recovery and recommerce partner with the technical expertise and resources to provide refurbished goods increases efficiency, streamlines the process, and boosts customer satisfaction.
Ingram Micro Lifecycle offers end-to-end reverse logistics solutions for technology products which include invasive and non-invasive solutions for repair and refurbishment. We operate trade-in programs on behalf of customers and have an established network of recommerce partners. Our innovative approaches boost yields of returned and traded-in products, lower waste, and enable a circular economy.
Get in touch with us today to learn more about how we can support your trade-in program.
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