CompAsia expects recommerce revenue to exceed US$237mil in 2022
By Karamjit Singh and Henry Chang March 31, 2022
- Growth driven by new products, 5G adoption & expansion to Indonesia
- Boost from shift to online and changing its focus to B2C from B2B
Who could ever have a clue that recommercing, which is the selling of pre-owned electronic devices, can have big business potential?
Well, enter CompAsia Sdn Bhd which has quietly grown in an unglamorous part of the mobile industry’s value chain into a US$71.06 million (RM300 million) business in 2019. That’s already hugely impressive for a seven year old company but it then experienced rapid growth over the past two years, and predicts another strong year for 2022.
“We have projected that this year we’re going to have over RM1 billion (US$237 million) in revenue,” CompAsia’s founder and CEO Julius Lim said, declining to reveal its revenue for 2021.
It sold around 500,000 mobile devices in the nine countries it operates in 2020, aided by the launch of its June 2020 e-store. “Last year, we sold over 600,000 devices, and this year we are expecting to sell over a million,” said Julius, adding that the e-store has experienced 2,500% growth since its launch.
The reason behind this boom is due to the crucial change in approach from B2B buyback and trade-in with major telcos and phone manufacturers to a B2C approach catalysed by Covid-19 and the rise in demand for affordable and reliable smartphones.
[Ed: Paragraph edited for accuracy. An earlier version mentioned CompAsia shifting to a C2C model as well but the company has clarified that it has no such plans.]
“Since then, we are looking to be more B2C focused in the coming years. Therefore, we’re going to raise brand awareness and trust, while also educating our consumers,” Julius added of the company he launched in 2012.
CompAsia claims to be a top recommerce and financial platform for technology devices focusing on buying back and selling second-hand electronic gadgets like smartphones, laptops and smartwatches at the most affordable price while maintaining maximum reliability in order to maximize their ‘lifespan’ to the fullest; all while minimizing e-waste at the same time.
In a sign of how market behaviour has changed, it does not focus on desktops which are no longer as common as they used to be.
“Therefore by focusing on devices that have more demand, we are able to optimize costs, which means even lower prices on the gadgets that we carry,” CompAsia’s Head of Marketing Elaine Ho said.
Since launching in Malaysia, CompAsia is today operating in nine countries including Singapore, Thailand, Vietnam, Philippines, Hong Kong, India, US and the UK while also having over 50 partners across the Asian region including major telcos, manufacturers, retailers, financial institutions, and insurance companies. It is launching in Indonesia this year.
When asked why they waited until now to expand to the largest country in Southeast Asia, Elaine said their expansion into new markets is dictated by the partners in each market.
“At the same time we had to be ready for a market with such scale. Now that we have grown significantly, we have the resources and the partners to help us enter the Indonesian market with confidence,” she explained.
That growth includes a burst in headcount from 2020, going from around 100 staff in Malaysia to a regional headcount of over 250.
“With our expanding presence in more locations, there are various roles we are looking to fill; hence the aggressive hiring spree for good talent across the region,” Elaine said.
While it is tough to find people who have experience or knowledge about the recommerce tech space in Malaysia, “we do bring in fresh graduates and train them about this industry,” Julius said.
Three new products to drive growth
“We’re going to invest a lot more in R&D, as things like our trade-in and financing are very tech enabled, and that differentiates us from everyone else,” Julius claimed while declining to elaborate on the amount CompAsia plans to invest into R&D.
CompAsia launched its InstaCash app in 2019, which allows users to trade-in their pre-owned devices for cash. Their smartphones would be picked up at a preferred location and they are paid on-the-spot. The app is available in Malaysia, Singapore, Thailand and the Philippines.
Users in Malaysia can use either their Malaysian identification card or passport for verification.
ReNew+ on the other hand does not have an app, but is a financing platform that allows users to pay later for devices across 36 months. Users in Malaysia must have the national identification card to be eligible, and those who don’t have one will not qualify for the program.
The InstaCover app will provide digitized device care programs that cover device warranty for an extended period, and swapping the enrolled device for a preferred model as long as the return device IMEI Number matches the enrolled device IMEI Number with no need for supporting documentation when applying. However, the app is still in its testing and development stages.
Growth in the post pandemic era to get 5G boost
While the shift online had benefited CompAsia during the pandemic, how will its business fare as Malaysia enters its Covid-19 endemic phase?
“There are several factors that will help us maintain our business momentum. A major contributor is the rolling out of 5G across the nation, along with other countries we are in,” Elaine said.
“Furthermore, we will be marketing our brand more aggressively, along with the support of our partners who have retail capabilities and are now opening up again,” she said, confident in the overall value proposition CompAsia offers the market.
“We offer high quality and affordable second hand devices through our e-store while offering trade-in, allowing them to finance their next phone, and also offer ReNew+ which is a convenient way for them to bring home a brand new device without having to pay a large lump sum amount,” she added.
With inflation beginning to bite, consumers are looking for various ways to cope and CompAsia has positioned itself as offering a key service to the market that does not sting one’s wallet.
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