Gadget buyback services launch
NEW YORK (AP) - January 17, 2008 A couple companies want to help us clear out those old gadgets,
while feeding our upgrade habit, helping the environment and making
a buck for themselves.
Instead of being hit up for an extended warranty next time you
buy a gadget, you may find yourself hearing a pitch from
TechForward Inc., a Los Angeles-based company selling a
"guaranteed" buyback plan for electronics.
For a fee paid when you buy a device - $9 for an iPod, for
instance - you get the right to sell it to TechForward at a
predetermined price that depends on how long you keep it. If you
sell an iPod after a year, for example, you would get $40; after
another year, $20.
In the financial world, this is known as a "put option" - the
opportunity to sell a certain number of shares at a certain price
at a certain date in exchange for an upfront fee. But Jade Van
Doren, TechForward's chief executive, said his inspiration came
from traveling in Asia, where gadget worship is even more
pronounced and some consumers buy new cell phones every few months.
"I just started thinking about ways that you could build a
company around ... encouraging people to live that lifestyle of
temporary ownership," he said.
The trade-in prices don't look competitive with eBay auctions,
but TechForward offers the convenience of free packaging and
shipping. Its prices assume the item is in good condition. The
company won't pay for an item that's broken, though it will supply
packaging, pay for shipping and arrange to recycle it.
In addition to trades TechForward accepts from customers its
retail partners sign up when they buy electronics, the company lets
owners of a limited range of gadgets sign up online to participate.
So far, TechForward's partners are small West Coast retailers.
They get a share of the initial fee and can count on repeat
business from customers who trade in their old gadgets.
"The fact that we're helping people upgrade more quickly is
beneficial to the owner of the device but also beneficial to the
retailer who's trying to sell the new product," said Marc
Lebovitz, TechForward's vice president of operations.
Techforward claims participating stores are selling its
guarantee with 12 percent of applicable gadgets.
NEW Corp., a much larger company that runs the extended warranty
programs for Best Buy Inc. and Wal-Mart Stores Inc., plans to bring
a slightly idea to stores in the second quarter.
The ecoNEW program - which amounts to a vast expansion of the
trade-in programs some retailers run, mainly as promotions - won't
charge upfront like TechForward.
It will provide store credit for old electronics in some
categories, like computers, MP3 players and smart phones - with the
dollar amount depending on the market for the particular equipment
when it's traded in.
Some items, like printers and non-LCD monitors, won't qualify
for credit, but users will be able to send them back to NEW for
free for recycling. Other items, like cell phones, aren't eligible
for credit or recycling.
Dan Hulkower, vice president of client management at NEW, said
the Sterling, Va.-based warranty company hopes to bring in as many
types of products as possible.
"We've got the green contingent in the company screaming for
this solution and to make it as altruistic as possible," Hulkower
said.
The program will be offered by retailers - NEW can't yet say
which - so customers will go to their Web sites or stores to return
things. With no receipt necessary, they will be able to return
things bought from other stores.
Some manufacturers, like Apple Inc., Dell Inc. and
Hewlett-Packard Co., run their own recycling programs, which
generally rely on customers mailing in their old gear. In
September, Sony Corp. started accepting discarded electronics at
some Waste Management Inc. drop-off centers.
The NEW and TechForward programs offer a new take. It's
reasonably easy to resell working, high-value electronics through
eBay, but it has been hard for consumers to dispose of defunct or
obsolete items in an environmentally safe manner.
Just 12.5 percent of U.S. electronics waste is offered for
recycling each year, according to the Environmental Protection
Agency, and much of that is actually dumped rather than recycled,
the EPA says.
Recycler TechTurn Inc. estimates there are 600 million to 800
million personal computers sitting unused in the U.S. They contain
substantial amounts of lead, among other toxic metals.
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On the Net:
http://www.techforward.com
http://www.newcorp.com/