Gadget Buyback, Part 1

Ready for a bit of reading? This article describes a program that buys electronics back from customers based on how long they've owned it before upgrading. I am really interested in hearing what you think about it. I'm going to keep working on my thoughts about it and post later today.

Companies launch gadget buyback services
Concept feeds consumer upgrade habit while helping the environment

By Peter Svensson



We think a lot about getting new gadgets, but not so much about getting rid of old ones. The result: old cell phones, defunct laser printers and Pentium III computers gathering dust.

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.

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