Interview with Augustin Becquet (EDHEC Master 2001), CEO of Recommerce Group and a protagonist of the circular economy in France

Augustin Becquet (EDHEC Master 2001) remembers clearly the years he spent working for major firms, but all that is in the past! His increasing awareness of his “responsibility for our shared future” attracted him to Recommerce Group – recently selected among the FT120 innovative French tech start-ups – in September 2019 as Chief Operating Officer. He took over as CEO last October, and here he tells EDHEC Alumni about his commitment to the circular economy and the underlying objectives.

What does your position at Recommerce Group involve?

As Managing Director, I coordinate the firm’s development and structure in France and abroad alongside its founders and staff teams. The main task when managing a scale-up is to set your priorities to accelerate business activities and ensure that shareholders and staff are aligned with those priorities. In 11 years the business has come a long way, constantly tweaking the ship’s bearing. At the beginning of the adventure, the founders’ initial vision was not to create a business as such but to do good for mankind and for the planet by recovering old phones, refurbishing them and selling them to people who couldn’t afford new devices. The sale price of those refurbished phones went to associations working in sustainable development via the MonExTel solution. The activity developed with the participation of Recommerce in a recovery scheme for Bouygues Telecom. The firm’s expertise began with smartphones, and now we’re taking on new categories like game consoles, PCs, tablets etc.

What is the principle behind the partnerships you’re developing?

Recommerce’s mission is to play an active part in the circular economy and bring together those who make it happen. We help traders become “retraders”. We have a real partnership focus with major firms (operators, retailers and e-commerce) to help them develop a “circular” dynamic. Their motivation in terms of CSR is also aligned with their economic interests, as recovering old devices allows them to increase customer loyalty and bring their customers back to their digital or physical channels. In this way, Recommerce does not pit the industries of new and refurbished devices against one another, broadly speaking. We believe a certain amount of innovation is needed, but we want the products purchased to be of good quality and usable for as long as possible.

You’ve been in partnership for some time with Amazon…

We hesitated to move towards certain partners whose values we felt were different to our own. Our approach has become very pragmatic. All market players want to offer their customers solutions that are respectful of the environment, but it is now difficult to cheat or take such issues lightly because consumers and private sector employees are increasingly committed and vigilant. As the leading online trader, Amazon asked us to support it in becoming a retrader. 

How mature is the market for the circular economy?

The market is around 10 years old. Recommerce pioneered this activity in France. Some market players are taking an interest, such as those from the world of trading: they were buying new terminals but now see a business opportunity in buying terminals and selling them on. There are marketplaces like BackMarket, which is more of a partner than a competitor. What makes Recommerce different is that it begins by providing software tools, followed by data intelligence. The big issue in the circular economy is determining the value of used products, the repairs needed, and ultimately the economic equation to give a used product a new life. Because unfortunately many products are not designed to have a second or third life. Since the market is very young, everything needs to be structured. We work a great deal with the French government so that quality can be recognised (e.g. labels providing customers with certain guarantees), and to avoid the whole grey market, for second-hand implies traceability problems.

With B2B, you use the expertise of your partners to serve the circular economy. With B2C, you are raising awareness among consumers. You seem to act on all levels …

Absolutely! To give you some figures, around 4.4 million second-hand smartphones (2.8 million of which are refurbished) are currently sold in France, representing between 10% and 20% of the market. These are good numbers, but low compared to the automobile market, with second-hand cars representing 70% of all car sales. Even though older car models are bigger polluters, we know that production represents 80% of the impact on the environment. Buying a refurbished smartphone avoids the extraction of 40 kg of primary raw materials (including rare minerals) as well as the equivalent of 30 kg of CO₂ emissions, making it a clear winner for the planet. There is also an economic opportunity as we’re talking about local jobs: in Europe there are hardly any high-tech manufacturers. If people bought 50% of their high-tech new and 50% through the circular economy, it would be excellent for our trade balance, for jobs and for the environment. All the lights are green for Europeans to develop this industry. Indeed, the government has just announced a goal of 20% of high-tech products used by public authorities being refurbished!

How is the international development of your business going? 

Like in many French companies and SMEs! It’s very difficult at the start because entrepreneurs often haven’t had the opportunity to confront several different markets. But all their energy ends up paying off! At Recommerce, several attempts have so far been successful, particularly in Switzerland, where we have teamed up with Swisscom (the country’s biggest operator). We are currently working to develop in the rest of Europe. We are recruiting market heads directly in the countries we target (Belgium, the Netherlands, Germany), with the intention of developing partnerships with local brands. And clients like Amazon immediately give us an international dimension, which is a significant boost for development.

Are consumers taking to this reconsumption dynamic?

The obstacles in our market are well known: “Will the experience be as good as with a new product?” So we’re making sure there are labels in the industry. Benoît Varin, co-founder of Recommerce, chairs the board of directors of the Rcube federation, which is in charge of refurbishing and re-use, a federation we worked with to define labels and best practices with a view to building up our industry and protecting consumers. We are currently setting up the same type of federation at a European level with companies who share our interests, and I will be serving as chairman. We are rolling out initiatives to explain to our end clients that there are quality control processes to guarantee that their product will work just as well as a new one. One quality criterion ensures at least 80% of the power of a new battery, but for some more demanding clients we offer a completely new battery for €19.

You talk about reconsumption, but ultimately isn’t it more a kind of “alter-consumption”?

When e-commerce burst onto the scene, the founders of Recommerce wanted to demonstrate the importance of thinking about the impact our consumption has on the environment and about overhauling the concept of consumption through a shift from new to refurbished products. The expression to promote as much as possible is “circular economy”, which carries the notion of repairability, especially as this is something consumers understand. We need innovation and new technologies, but we also have to work on more sustainable products so that once a consumer has used them, another consumer can take over. The money generated by selling phone allows consumers to buy a new high-performance device. Whereas another customer might not need so much performance and can choose a phone already used for two or three years but which can perfectly meet their needs.

You might say you’re countering the consumer culture but at the cutting edge of technology …

We need to ask questions about obsolescence and pricing structures, which I believe is a battle we must wage together. We’re trying to promote an industry in which a new product will no longer cost €299 but €399. That product at €399 will be manufactured in such a way that it can last much longer. This is a highly virtuous battle because the brands and manufacturers making new things will ultimately be less interested in the race for the most aggressive pricing to sell en masse. Our model has something for everyone: a consumer buys a product at €500 but knows that two years later he can sell it for €300. Ultimately, it is in his interest to buy that kind of product rather than one at €400 but which will be of no use two years later.

When a product is refurbished, what happens to the parts that can’t be used anymore?

We don’t throw anything away! All functional spare parts are reused to repair other products. When unfortunately nothing can be done with a part, we have it recycled by Morphosis, a global market leader based in France, who extract the rare materials to make new ones.

At Recommerce are you calling for a return to basics to counter the race towards over-consumption?

Yes, we are firmly committed to an approach based on virtuous sobriety and the fight against waste. We welcome the repairability index put in place by the government on 1 January (which we helped set up), which must now appear on all new high-tech products. At the moment only 40% of products with operating problems are actually repaired. This issue is essential in getting consumers to raise questions about the quality and sustainability of products, and so they can continue to use them or sell them on in the right conditions. My personal battle is against deceitful marketing approaches claiming unlimited video and music content or telephone usage, etc. Behind all these services there are devices running non-stop, powerhouses, server farms that are very real (and are warming the planet). In business schools, it’s time to start explaining that marketing needs to be responsible and take into account the finite quality of our resources. That would be a fantastic challenge to succeed!

Do you think that the implementation of measurement indicators will convince consumers to change their habits? 

I believe informing consumers is of the utmost importance. Perhaps we need to adopt more drastic measures, even though instinctively I don’t favour such moves. We hope it’s not yet too late, but as soon as limits are laid down to force industries to change, you see a positive evolution. Bad habits need to be wiped out because we are facing an emergency. This is clear in an issue like gender equality. You need the right mix between incentivising measures, obligations and everyone acting responsibly.

Have you seen a rise in awareness since COVID? In your market or among your interlocutors? 

There is clearly a growing awareness for many reasons. The first, of course, is unfortunately linked to people’s wallets. When you’re a bit more careful about what you spend, you wonder whether you really need the latest iPhone, when the second latest model or the one before that was perfectly satisfactory. The second reason is globalisation and its limits, which we can all now see. Institutions and the big operators we work with have also begun to speak out about recovering old devices and refurbishing them. That has injected a real dynamic into our market. So we are seeing a set of effects that have generated growth for our activities since the beginning of the pandemic, with very strong demand, although our collection operations were slowed down due to store closures for almost 3 months. Then there’s the GreenDeal, a European recovery “super plan” worth more than 1000 billion euros, with a wide range of initiatives on renewable energies. This rising awareness concerns everyone: consumers, institutional partners and States. Our role, as professionals working in the sector, is to point our partners towards that which is virtuous with a view to developing the circular economy.

Is greenwashing becoming easier to spot? 

I think consumers aren’t completely gullible, and it’s difficult for a brand to switch from black to white and overhaul its image too quickly. We now have many very clear criteria about CSR objectives, both for investors, who are beginning to add more and more CSR criteria, or in calls for tenders in public procurement. You can engage in communication, but there are now commitments that are important to stick to, so big companies can’t really play that game anymore. Not to mention the fact that there are now many lobby groups capable of singling out those guilty of greenwashing. In the run-up to Black Friday, some brands tried to make it clear they weren’t participating for environmental reasons but they fell victim to their own ambition. The path to avoiding greenwashing in my view is all the different criteria that will be applied at all levels so that businesses and citizens together can contribute to the planet’s protection.

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