Ebay electronics resellers cry foul on new ‘refurbished’ rules

What’s the difference between a gadget that’s used or one that’s refurbished? It’s a thin line with a lot of grey covering it, and it’s always been a bit fuzzy on big marketplaces like Ebay and Amazon. According to an investigative report, Ebay’s recent efforts to establish more stringent standards for “refurbished” goods are creating a lot of trouble for smaller resellers.

Earlier this year Ebay began its Ebay Refurbished program, a means by which the gigantic reseller now more tightly controls which sellers can claim that their goods are “refurbished” instead of merely “used.” The program also includes a standard Allstate product warranty of one to two years. But a report by KnowTechie is casting doubt on the program, which restricts the “refurbished” label to only sellers that are approved by the company. All others need to mark their goods as “used,” no matter how much work or testing has gone into restoring the item in question, or (for example) whether it comes with a limited warranty from another source.

The report alleges a series of obfuscating elements that puts smaller resellers at a disadvantage. A particular sticking point is that in order for a seller to join the program, they need to adhere to a non-disclosure agreement that covers the terms. The NDA covers not just the standards by which Ebay measures a seller’s right to label their products as “refurbished,” but the process by which the seller becomes vetted. Crucially, sellers are bound by the terms of the NDA even if their application is rejected, and they’re thus forced to sell all non-new goods as “used.”

According to the report, smaller resellers who can’t meet Ebay’s standards (which, again, are not public knowledge at this point), or who refuse to the lack of transparency created by the NDA process, will be at a distinct disadvantage versus those who can. No matter how much work, testing, or after-sale service goes into a gadget, they’ll be forced to label it as “used,” creating a two-tier system in the eBay reseller marketplace.

It’s easy to see that large corporations who use Ebay as a marketplace for refurbished goods, like Best Buy, Dell, and Lenovo, are better positioned to take advantage of the new system. Not only will their resources and official status make it easy to meet the requirements, and to gain even more clout via the even higher “Certified Refurbished” tier, but they can be in a better position to negotiate any necessary exceptions to the policies behind the NDA. Smaller and independent refurbishing shops simply can’t compete.

The full report over on KnowTechie is worth a read if you’re a regular buyer of secondhand equipment, or at all interested in the right to repair movement.