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SWAP: Showing path towards circular economy

Shamim Ahmed
19 Mar 2023 00:00:00 | Update: 19 Mar 2023 00:10:43
SWAP: Showing path towards circular economy

The use of electronic products has increased immensely during the last decade and the country has undertaken a number of initiatives to make electronic products available all across the country.

Eyeing the country’s large consumer market, different global brands not only release their latest gadgets regularly in Bangladesh but have set up manufacturing factories also to produce huge quantities cost-effectively. Alongside the retail stores, a number of local and global e-commerce companies now sell new gadgets online.

But the rapidly increasing use of electronic products raises concern over where this huge volume of devices would end up once out of use. Will those e-scraps finally end up in a dumping ground or landfill?

An innovative entrepreneur came up with a unique solution to the problem, foreseeing huge business prospects in the used electronic devices.

With an aim to ensure the affordability of electronic devices as well as reduce e-waste, Parvez Hossain founded SWAP BD Ltd in 2020 with a vision to contribute to the country’s circular economy, an economic system based on the reuse of products in a sustainable or environment-friendly way. SWAP is the first ever C2B and B2B marketplace and the only re-commerce platform in Bangladesh.

Within only two years of starting its journey, SWAP has grabbed 10-15 per cent of the country’s Tk 20,000 crore re-commerce market. It has resold around 100,000 electronic products including 63,500 used smartphones. Now, it has 50 partner shops and 3,000 agent shops across the country.

During these two years, it prevented 2,723 metric tonnes of carbon emission, protected 370 metric tonnes of e-waste, and saved 442,370 litres of water. It has also received Tk 17 crore in funding so far.

Beginning of the story

I have had a passion for technology since my student life. While studying IBA, I used to buy products from e-commerce platforms like sellbazar for my personal use; but buying and selling was so tough at that time.

“Buying a laptop 20 years ago was not easy as the price was over Tk 1 lakh. So, my friends and I bought a laptop collectively. I used to save money during my university days to upgrade or exchange my handset,” said Parvez Hossain, chief executive officer and co-founder of Swap BD Ltd.

Parvez realised that the demand for second-hand bikes and cars was also high. Hence, the idea of SWAP came up.

“We launched a reselling platform for retail business named live1 in 2007. We used to buy and sell products, but the growth of the platform was not as per our expectation as the market was not ready. We were working on only one per cent of the market profit. Customers were going back not getting the exact prices of products. At that time, there were only a few e-commerce platforms like seradam or clickbd where people would post,” he said.

Sharing the beginning of SWAP, he said, “We started with two people in August 2019 on a pilot basis at the Banani office. Later, the number of employees gradually grew. On February 20, 2020, we officially launched the platform with 26 people and now we have 104 people in our team.”

“Other similar platforms follow the P2P or C2C business model, where the selling procedure is uncertain. However, SWAP is a C2B marketplace where we connect the consumers to the businesses,” he added.

“SWAP received an overwhelming response during Covid pandemic because many consumers had products lying around and they could sell it off through the platform, which also aided them with extra cash, Parvez said, adding, “SWAP mainly deals with electronic gadgets like mobile phones and laptops. Monthly, we buy and sell 7,000-8,000 units on average.”

“In Bangladesh, we have electronic products worth around Tk 20,000 crore which can be resold. But most of the used gadgets are not sold thinking of the reselling hazards or hassle. However, the sale of such products will increase day by day, as the re-commerce market is expanding three times faster than the e-commerce market globally. The annual growth of e-commerce is around 10 per cent while the re-commerce market growth is over 30 per cent,” he said.

Parvez said, “So far, we have managed to cater to 10 to 15 per cent of the total market. As the market is expanding too fast, we are expecting to cover 50 per cent of the market share in the future.”

In 2022, we have resold around 100,000 units of electronic products. We offer 15 days replacement time and in some products, we give one year warranty, he said.

How it operates

SWAP offers a seller to sell used items at any convenient location and time, and accepts various payment methods either digitally or by cash. It gives various options to customers – exchange offers, gift cards, and so on which can be used to purchase from other stores, e-commerce platforms, or any marketplace. In a nutshell, SWAP is the only digital platform in the country by which customers can enjoy trouble-free selling and earn quick money.

“SWAP got 70,000 buying and 92,000 selling requests for used products in 2022. The pricing is transparent, our representatives go to the customers’ homes and offices, and the money is transferred instantly,” said Parvez, adding, “Now, we have 50 partner shops and 3,000 agent shops where customers can exchange their used gadgets like Samsung, Oppo, and Vivo smartphones. Later, we collect the products from the partner or agent shops.”

SWAP has many programmes, such as special exchange programmes for the employees of startups and corporations. SWAP also purchases the surplus products of different companies and gives them the opportunity to exchange those for new ones as part of the B2B model.

Currently, SWAP BD Limited is a re-commerce platform that conducts the business of buying, selling, and exchanging used smartphones, laptops, motorcycles, and cars along with providing rental laptops.

Helping digital inclusion, saving environment

Parvez said, “We want to save the environment from the pollution caused by e-waste. Bringing people from lower income groups under digital connectivity is also our aim. Those who cannot afford Tk 12,000-14,000 handsets can use our phones at affordable rates through an easy payment method.”

“We try to repair the handset at first, if not possible, we reuse the parts for another assembled handset. We try to make sure that no part of a handset is wasted,” he said, adding, “We have received funding of around Tk 17 crore so far from both local and foreign investors. We did not take loans from any bank except startup funding.”

Prospect of used electronic goods market

The sale of used devices is becoming increasingly popular in Bangladesh due to their affordability. The growing e-commerce sector in Bangladesh has contributed to the popularity of used devices. There are several places for buying and selling used devices in Bangladesh, including e-commerce platforms, social media platforms, and stores selling electronic goods.

Many people in Bangladesh cannot afford to buy new devices, especially smartphones, which are essential for communication and access to information.

The price of second-hand devices is lower than new ones, making them more accessible to a wider range of customers. The pre-owned device market in Bangladesh is likely to continue to grow in the coming years as more consumers seek electronic gadgets at affordable prices.

The market for used electronic goods in Bangladesh has been growing in recent years due to increasing consumer demand. The market includes a wide range of devices, including smartphones, tablets, laptops, and gaming consoles.

The response

Due to the growing demand for used devices, SWAP received a very good response from consumers. On average, its yearly sales order is 69,717, monthly orders 5,809, and daily orders 191.

SWAP has formed partnerships with around 95 partners till now. Till now, SWAP has received Tk 17 crore in funding.

As an e-commerce and re-commerce platform, SWAP faces several challenges. Firstly, ensuring the quality of used devices can be challenging, as it is difficult to verify the condition of a device without physically inspecting it.

Secondly, building trust among consumers is a significant challenge for pre-owned device businesses. Many people are hesitant to buy pre-owned devices, especially online, because of concerns about fraud or the probability of receiving faulty devices.

Thirdly, managing inventory can be challenging for pre-owned device businesses, as they need to balance supply and demand to ensure that they have enough devices in stock without over-supplying and risking losses.

Fourthly, since all pre-owned devices are unique despite being the same model, maintaining the stock of these devices and ensuring the delivery of the correct product to the customer requires extra attention and precision.

Overall, while the demand for pre-owned devices in Bangladesh is high, there are still some challenges that need to be addressed to ensure that consumers can buy reliable and affordable devices with confidence.

However, with effective management and implementation of best practices, SWAP has been trying to overcome these challenges and so far, SWAP has been able to succeed in this endeavour.

SWAP against environmental pollution

By promoting and encouraging the reuse and recycling of used electronic products, SWAP helps reduce carbon footprint, e-waste, and waste of water, said Parvez.

Till now, SWAP has been able to reduce around 2,723 metric tonnes of carbon emission and 370 metric tonnes of e-waste, besides saving 442,370 litres of water, selling more than 63,500 used smartphones.

Dreams with SWAP

Talking to The Business Post, Parvez said, “I want to make technology affordable to all while reducing e-waste and carbon emission. My vision is to lead the transition towards a more sustainable future by providing a convenient and responsible way to buy and sell used goods with the help of SWAP.”

“With the right strategy and focus, SWAP aspires to become a remarkable example as a successful and sustainable startup in the ecosystem,” he said, adding, “We believe that SWAP provides a solution which the Bangladesh market greatly needs. By selling pre-owned goods, we are providing our country’s low and middle-income households access to technology at an affordable price while encouraging the circular economy concept.”

“By increasing the lifespan of electronic devices and light vehicles, we can ease the pressure on import of such goods which would help reduce the pressure on dollar reserves,” the SWAP chief stated.