What is ReCommerce? A subset of e-commerce allows companies to sell their returned products to consumers, reducing the need for new products and increasing margins. Backflip is a ReCommerce platform that works when you have excess inventory or accumulated stuff at home that you want to get rid of. For example, your store may be overstocked due to a popular fashion trend or items not selling. Additionally, you may have things that customers return due to a change of mind, damage, or an unmet expectation.
ReCommerce is a subset of e-commerce.
ReCommerce is a type of e-commerce that focuses on upcycling items. The entry barrier is relatively low, making reCommerce a good choice for entrepreneurs looking for a part-time or full-time venture. Today, retail e-commerce is expected to reach $27 trillion globally by 2020. Its popularity is primarily due to its streamlined and flexible system, making it easier for small businesses to grow and scale. As a result, it’s a powerful tool for both small and large companies.
It allows businesses to sell returned products.
One of the most cost-effective ways to reduce the costs associated with product returns is to allow customers to return items. Online purchases can be expensive for businesses, and returns can quickly deplete a business’s profit margin. In addition to labor costs, shipping and handling fees can eat away at a retailer’s profit margin. Fortunately, ReCommerce allows businesses to sell returned products on their website for a profit.
Companies can use ReCommerce to maximize the return rate by offering free returns to consumers. Many consumers are now more likely to return products if a retailer provides a convenient network of return points. It can save money on printing labels and providing packaging at the end of the return. Consumers will appreciate the convenience of free returns.
It reduces the demand for new goods.
The theory behind reCommerce is that consumers will use a used item for a shorter period before buying a new one. The sustainability movement places a high priority on reducing the consumption of new goods. By reducing the need to purchase new goods, the environment is helped at both ends of the consumption cycle. However, the idea of recommerce has been met with resistance in some quarters.
ReCommerce has become an important strategic goal for businesses. Organizations without recommerce policies will find it increasingly difficult to gain the trust of their shareholders and consumers. Stringent environmental laws, scarcity of raw materials, and supply chain volatility drive businesses to adopt recommerce models. Consumers, employees, and shareholders will abandon the brand without eco-conscious practices. Fortunately, the recommerce trend has caught the attention of major brands. Burberry and H&M have recently launched their reCommerce business models. In addition, Patagonia recently announced plans to open a brick-and-mortar store exclusively featuring their reCommerce collections.
It increases margins
Increasing margins in e-commerce requires several strategies. First of all, increasing the price of your products is not a good strategy. However, increasing the average order value can significantly increase revenue. Increasing the average order value can be achieved by bundling products, expanding your product line, or acquiring more traffic. Fortunately, increasing average order values does not affect your gross margin. It is much more difficult to reduce product-related expenses.
Moreover, if you have a bestselling item, you can easily resell it multiple times. That way, you can increase your margins for this item. However, you should be aware that reselling can lead to slim margins. Despite that, it is good to set a minimum amount for a product to increase the AOV. It is also helpful to bundle products or offer coupons to increase the AOV.
It reduces wasteful business.
Recommerce is a growing industry that offers more benefits than simply recycling. It saves money, but it can also reduce the environmental impact of products. Every time an item is purchased, several materials and energy are used to create it. According to McKinsey research, buying one used thing would be equivalent to taking 500,000 cars off the road for an entire year. Aside from this, recommerce is an increasingly popular choice for consumers who want to avoid contributing to the growing environmental problem.
While the term “recommerce” might suggest a less wasteful way to shop, the concept is essentially about preserving the retail industry and helping the environment. Recycling is a critical component of the circular economy, which can help to limit the negative impact of product-based pollution. In addition to recycling, recommerce offers consumers a way to purchase previously owned products that are no longer wanted or are only partially used. This practice was previously limited to brick-and-mortar stores but has become widely available online. It brings systemic changes to waste management and how valuable materials are recovered. In addition, it helps retailers to avoid hazardous production processes, which are causing the waste problem.