Product returns are an increasing problem in the European e-commerce market. Around 15% of all sold products are returned to the vendor. Most e-tailers have no solution for the fast-growing pile of returns they encounter in their warehouses. They have no other option than quickly amortize their goods and take a loss of up to 80% on their initial value. Not only monetary value is lost, but the environment is also affected by this extensive devaluation. 4 billion pounds of good quality products are disposed annually and the 11 million metric tons of carbon emission that was used for the production are spoiled. Although these numbers seem staggering, this is still the top of the iceberg. In the past 6 years, the e-commerce market has experienced rapid growth (14% annually) and there are no signs of slowing down.
BuyBay solves this problem by embracing returns and reselling them for a fair market value. With funding of the EU, BuyBay developed a data-driven solution that revolutionizes the intake, processing and resale of returned products. It uses highly innovative pricing software and is unique in its ability to connect inventory management and re-product grading to multiple third-party sales channels. BuyBay, hereby sets the standard for the reversed supply chain.
The different activities and results that BuyBay performed were integrated under an umbrella project: Project SMILE. The title of this project refers to the level to which BuyBay, with each re-product sold, makes a consumer happy, reduces waste, creates added value for our partners and leaves our world a little more sustainable. With the support of the H2020 grant we enabled growth in three areas:
First, a new and more efficient IT infrastructure was developed, that is capable of serving the entire European market. BuyBay improved its IT systems significantly to support the value chain in the best possible way. A new IT system was developed, launched and is continuously evolving into an even better system. This system ensures that all products are enriched with data and that all our stock is offered simultaneously on marketplaces through Europe and sold fully automatically. To make sure that our system is also scalable in Europe, we added the functionality to make sure that the software has the possibility to serve multiple warehouses.
Secondly, BuyBay improved its business intelligence methods, enrolled a new machine learning model and implemented a pricing strategy tool. New internal developed AI/machine learning pricing software now automatically retrieves the optimal price for the products on offer. With enabling multiple high-tech data features, it is guaranteed that BuyBay is the best solution for returned goods.
Lastly, a European roll-out was started. After a thorough analysis BuyBay decided to enter the German and French market. Since the beginning of Project SMILE, BuyBay created twelve partnerships with different companies in Germany and France. Resulting in an output of over 46.000 products sold in these countries after the fast roll-out.
The impact of project SMILE on BuyBay and its environment is gigantic. BuyBay became, with the support of the European Union, a profitable self-supporting business that is able to invest heavily in innovation. Partners get a higher pay-out for their products than ever before and BuyBay made a big socio-economic impact by reducing carbon emission and creating public awareness about the return product problem. These results were not left unnoticed and were acknowledged by many objective institutions who gave BuyBay multiple awards.
