Businessmodel of reBuy

Customer Segments

reBuy has a multi-sided business model, with two interdependent customer segments that are both needed in order to operate:

• Sellers – Consumers who sell their used products to the company
• Buyers – Consumers who buy used products from the company ### Value Proposition

reBuy offers five primary value propositions: accessibility, convenience, cost reduction, risk reduction, and brand/status.

The company creates accessibility by providing many options for consumers. It enables people who want to get rid of used products to earn money and provides used products for sale to those seeking discounts. Buyers can use one of several payment methods, including debit card, credit card, bank transfer, purchase invoice, or PayPal. Lastly, the site is available in French and Dutch versions.

The company offers convenience by making its service easy to use. It buys products from consumers at flat prices, avoiding the auction model used by sites such as eBay. Sellers can find out the purchase price by entering information such as ISBN or EAN codes on the website. When they ship their products to reBuy, it checks them in within 24 hours, and sellers are paid within the next day.

The company reduces costs. Buyers who purchase used items on its site can save as much as 50% off the original product price. Furthermore, it pays for all shipping costs.

The company reduces risk by maintaining high standards and enabling returns. It inspects all products it purchases, refurbishing them and/or reparing them if necessary. Customers who make purchases can return them within 21 days if unsatisfied and also receive an 18-month warranty. The company’s operations have been certfied by Trusted Shops as meeting its quality criteria.

The company has established a powerful brand due to its success. It has over one million registered users and sells over eight million different products in 13 categories. Product categories include all types of media and electronics, including video games, movies, music, software, phones, consoles, tablets, and eBook readers. It ships items to Germany, Austria, France, and the Netherlands.

Channels

reBuy’s main channel is its website. The company promotes its offering through its social media pages, TV advertising, and participation in conferences.

Customer Relationships

reBuy’s customer relationship is primarily of a self-service, automated nature.

Customers utilize the service through the main platform while having limited interaction with employees. The company’s website provides answers to frequently asked questions and access to an e-mail newsletter offering discounts and promotions such as contests.

That said, there is a personal assistance component in the form of phone and e-mail support.

Key Activities

reBuy’s business model entails maintaining a robust common platform between two parties:  sellers and buyers. The platform includes its website and its mobile app.

Key Partners

reBuy maintains partnerships with the shipping companies DHL, Hermes, and PIN Mail.

The company also operates an affiliate program through which third parties can advertise it through their platforms (websites, mobile apps, etc.). Advertising formats include banners and links. Affiliates receive a commision of 13% for ad visits that lead to purchases of software and 3.5% for visits that lead to purchases of hardware (i.e., from site buyers). They receive a commission of 4% for visits that lead to sales of software and 3% for visits leading to sales of hardware (i.e., from site sellers).

Key Resources

reBuy’s main resource is its proprietary software platform, which serves over one million registered users.

It depends on its engineering employees to maintain and update the platform and its customer service personnel to provide support. Another important resource is its 10,000 square meter logistics center in Berlin, which holds over two million products.

Lastly, as a startup it has relied heavily on funding from outside parties, raising $11.4 million from 10 investors as of January 2014.

Cost Structure

reBuy has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions.

Its biggest cost driver is likely handling expenses, a variable cost. Other major drivers are in the areas of sales/marketing, logistics and administration, both fixed costs.

Revenue Streams

reBuy has one revenue stream: revenues generated from sales of the products it features on its website.