What do most people do when they upgrade their phones or buy a new
laptop? They sell the old via platforms for refurbished goods. The
most-sold items online in the refurbished category are smartphones,
laptops, headphones, watches, small appliances and Kindle e-readers, to
name a few.
The refurbished goods market in India will be worth an estimated $20 billion in the next five to six years.
Smartphones, the most popular product in the refurbished category, saw volumes grow by close to 25 percent in 2017. It crossed 12 million units in India, according to Counterpoint research’s report - Technology Market Research.
The global market for refurbished smartphones grew 13 percent
year-on-year in 2017, reaching close to 140 million units. By
comparison, the global new smartphone market grew a scant three percent
last year, thus being outpaced by refurbished ‘second-life’ smartphones,
according to the latest data from Counterpoint’s Refurbished Smartphone
Tracker.

Flipkart logo. Reuters
India's refurbished goods marketplace houses some established and
well-known names like Shopclues, OLX, Quikr, among a host of
others. Besides, with social media gaining much currency, several
Facebook and WhatsApp groups too act as a channel for those interested
in selling or buying refurbished goods. It is in this growing market
that Flipkart has rolled out its platform for refurbished goods -- 2GUD.
“We will keep evolving and bringing newer formats, categories and
features which cater to the needs of our value-conscious middle India,"
Flipkart CEO Kalyan Krishnamurthy said, adding that all eBay.in sellers
and customers will be migrated to the new platform.
"The new platform has a different value proposition compared to
Flipkart, and will cater to a different target audience. We are
committed to investing in this independent brand," he pointed out.
But will Flipkart be able to cash-in on its brand name and succeed?
There are early movers in this space. Think Quikr, OLX, GreenDust, Reboot, Togofogo, Overcart, Shopclues and Amazon.
According to a survey by Quikr, people who prefer pre-owned goods are
chasing better pricing, easy availability, doorstep service and a
short-term requirement. The majority of people who lean towards this
segment are in the 20-29 age group and about 54 percent of those polled
said they prefer refurbished goods for better pricing and easy
availability of products.
Amazon promises fast shipping
Amazon which rolled out its ‘Amazon Renewed’ programme last year, has
found customer demand across categories including smartphones, laptops,
headphones, watches, small appliances and Kindle e-readers to name a
few.
Vivek Somareddy, Director- Seller Services at Amazon told
Firstpost,
the refurbished goods category is growing 300 percent y-o-y with over
70 percent of all orders coming from cities like Kanchipuram,
Secunderabad and Surat to name a few. This category has become a ‘go to
destination’ for Indian customers who aspire to buy high quality
aspirational products at more affordable prices, he said.
“Certified refurbished products are worked upon by the original
manufacturers or professional refurbishers in adherence to our product
quality policy. Customers purchasing products through Amazon Renewed get
high quality, like-new products at a competitive price – in fact, they
can save up to 50 percent while purchasing a refurbished product vs the
purchase of a new product,” Somareddy added.
Amazon, however, has a strict policy.
"We have a very strict policy regarding quality and under this program,
only selected sellers who maintain a high quality and performance bar
are allowed to offer certified refurbished products on
Amazon.in.
"The refurbishment process for this category typically includes a
full diagnostic test performed through industry standard applications,
replacement of any defective or damaged parts, a thorough cleaning and
data wiping process, and finally the repackaging in a brand-new box. The
products come with a minimum of six months warranty offered by the
brand or the seller of the product and are available for free and fast
shipping with
Amazon’s Fulfilled by
Amazon (FBA) shipping service."
Re-New eyes 16 million customers
ShopClues runs Re-New Gadgets for refurbished goods. Re-New clocked
Rs 4.5 crore in sales from refurbished and unboxed electronic devices
alone, including laptops, smartphones, and tablets, for the month of
July. It is looking to double GMV growth with a 16 million customer
target in 2018.
“ShopClues had long identified the massive opportunity around the
refurbished category; specially the renewed smartphones segment, which
according to industry estimates, is set to grow by over 27 percent in
2019. We have almost doubled our customer base from eight million to 16
million within two years and our success has given us confidence to
offer more than 400 stock selling units from different brands in the
smartphone category.
"Also, soon ShopClues will be launching a full assortment of laptops
and TVs from HP, Dell, Apple, Asus, Lenovo, LG, Sony and Samsung for its
customers,” said Radhika Aggarwal, co-founder & Chief Business
Officer, ShopClues.com
There is a need for more players in the refurbished goods market in
India, as there is a market for used products that can be recycled and
upcycled, said Devangshu Dutta, Founder-Chief Executive, Third Eyesight.
When people move cities, countries, there are a number of products
that are used for a short time and have not lived their full life-cycle,
and refurbished goods players come to their aid. However, he said, it
is all about peer-to-peer trust.
“If the platform stands by some kind of a guarantee, it will improve
that transaction and increase the number of transactions. Else, it does
not matter who is doing it. Just because Flipkart is a known name, it
won’t find it easy navigating this space,” Dutta added.
The Flipkart advantage
The post-purchase warranty of three to twelve months for each product
would be serviced through an extensive network of service centres
across India, said Flipkart's Krishnamurthy. "Additionally, users will
always be assured of convenience in payments and logistics," he added.

Flipkart’s new move toward refurbished goods is a good experiment on
its part, said sector specialists. Indian consumers want to own good
products but a large number of them have low purchasing power. Beyond
the pre-owned two-wheeler and four-wheeler market, there aren’t many
platforms which cater to this need. At best, single brand players remain
an exchange platform, they said.
But the challenge for Flipkart is to ensure quality. “Customers want
goods to perform and will need after-sales services, as original
equipment manufacturers won't be able to provide warranties with the
product out of the warranty period. And with products being refurbished,
no manufacturer can provide guarantees. Flipkart has the advantage,
with technology and logistics. 2GUD is a good opportunity but execution
will be the key [to the platform's success],” said Arvind K Singhal,
CMD, Technopak.