Bangalore, June 30 2017: When it comes to selling used products, the avenues available are limited: social media or specific online portals or the local secondhand goods trader. These avenues entail multiple inspections, bargaining and do not offer in exchange, another upgraded second hand product.
Seeing the gap in this segment three software engineers, Durai Gowardhan, Rahul Varma and Vineeth Kumar decided to look at the prospect of purchasing used household appliances that were not more than four years old, refurbishing and selling the same with a six month warranty.
It all started when the trio moved to Delhi for a short period of one year to train for the Civil Services. The glaring lacuna in this segment became evident to them when they tried to either hire or purchase used home appliances. Realisation then dawned that this must be the experience of short term residents as well as newcomers to a city who are looking at a similar market. The trio was then quick to spot a business opportunity waiting to be tapped in this domain.
Refabd, which started its operations in June 2016, initially dealt with purchase and sale of washing machines and refrigerators but within a year down, have extended their cover to televisions, furniture, laptops and other household items. The purchase is however with the precondition of the product meeting specific quality standards.
How it works: Interested sellers can log on to their website and upload information on the product offered for sale and their contact details. This is followed with a physical inspection of the product by a technician, negotiation of the price and final purchase. Sellers are invariably those leaving the city or those wanting to upgrade their product.|
While these pertain to direct customers, a second source of the company’s purchase comes from e-commerce platforms. This source supplies what is referred to as ‘unboxed’ items which have suffered small damages during shipping and have been returned by the clients who have ordered. Since these items cannot be resold by the manufacturer, these are bought directly from the online marketing companies by Refabd, damage if any is rectified and sold to customers at a marked down price.
Incidentally, the customers are happy as they get these latest products at a large discount merely for a small blemish or dent that would have occurred during transportation. Generally the products offered by Refabd in this segment are priced anywhere between 50 to 70 per cent of the MRP prevailing in the market for the new product.
The refurbishing process: The refurbishing of the products purchased is a process that begins at the warehouse where they are stored. Here three stages of quality control (QC) occur with the first stage pertaining to testing the product in terms of inspection to see if it passes the QC. The second stage involves a full cycle of testing and repairs if required. Once the product is fit for sale, in the third stage comes in photographing, where candid pictures with all the dents and blemishes if any are taken and uploaded on the website along with full information on the product as well as the expected price. The products are all sold with 6 months warranty. The products are also given a QC rating based on the age as well as the condition and quality of the product. The QC rating enables the customer to make an informed choice.
Hassle free return: Before purchase the customer is expected to read the entire literature on the product uploaded. However if any fault that is not listed is detected, exchange of the product is available. A provision for return within seven days of purchase in case of dissatisfaction is also provided.
Buy back option: The customer is also free to exchange the product after a few months of purchase in case of a choice to upgrade the product. Selling back the product too is permitted if the customer is leaving the city within 6 months of purchase. The buyback option in the case of exchange to upgrade the product is pegged at 80 per cent of the original price sold at. If the buyback is to accommodate shifting of residence within 6 months, the price offered for the same product would be 80 per cent of the price it was sold and 70 per cent in case of a lapse of a year.
Funding: Refabd received its initial seed funding from ATHAMUS Ventures which was sufficient to carry out the operations in Bangalore. Currently it is looking at more funding to expand into other domains of products as well as other cities such as Delhi NCR, Hyderabad, Chennai and Pune. The last 11 months of operations of the company saw revenue accrual of Rs 7 millionThe customer reach so far stands at 5000 plus with daily visits to the website registering over 100 unique customer.