Explainer: Repair, reuse & refurbishment — the concepts, the economics, and the decision checklist

Every year, the European Union discards approximately 35 million tonnes of electronic and electrical equipment, furniture, textiles, and other durable goods that could have been repaired, refurbished, or reused. According to the European Environment Agency's 2024 Circular Economy Report, extending the lifespan of products by just one year across key sectors could reduce annual greenhouse gas emissions by 4.5 million tonnes of CO₂ equivalent—roughly equal to taking two million cars off European roads. Yet despite this massive environmental and economic opportunity, only 12% of European businesses have implemented structured repair and reuse programmes that meet minimum viability thresholds. This explainer unpacks the core concepts, examines what separates successful initiatives from failed ones, and provides a practical decision checklist for sustainability leads navigating this transition.

Why It Matters

The repair, reuse, and refurbishment economy represents one of the most tangible pathways to decoupling economic growth from resource extraction. In 2024, the European Commission estimated that circular economy practices—with repair and reuse at their core—could generate €600 billion in annual economic value across the EU by 2030 while creating 700,000 new jobs. The urgency has intensified: the EU's Ecodesign for Sustainable Products Regulation (ESPR), which entered into force in 2024, now mandates that manufacturers design products for repairability and provide spare parts for defined periods.

From a carbon perspective, the numbers are compelling. Manufacturing new products typically accounts for 70-90% of their lifecycle emissions. The Ellen MacArthur Foundation's 2025 analysis found that refurbishing a smartphone extends its functional life by an average of 2.5 years and avoids 55 kg of CO₂ emissions compared to manufacturing a new device. Scale that across the 200 million smartphones sold annually in Europe, and the potential avoided emissions reach 11 million tonnes annually.

The regulatory landscape has shifted dramatically. France's repairability index, now in its fourth year, has driven measurable change: products scoring above 7/10 on repairability saw 23% higher sales growth in 2024 compared to lower-scoring alternatives. Germany's 2025 Circular Economy Act mandates that all public procurement contracts above €50,000 include circularity criteria, with repair and refurbishment options weighted at 15-20% of tender evaluations. Sweden's reduced VAT on repair services (from 25% to 6%) has catalysed a 340% increase in registered repair businesses since 2020.

For corporate sustainability leads, the business case extends beyond compliance. Companies with mature repair and reuse programmes report customer retention rates 18-25% higher than industry averages, according to a 2024 Deloitte study of European consumer goods manufacturers. The unit economics increasingly favour circular models: refurbished industrial equipment typically sells at 40-60% of new-product prices while delivering gross margins 5-15 percentage points higher than new sales.

Key Concepts

Repair refers to restoring a defective product to full working condition through targeted intervention—replacing a broken component, fixing a software fault, or addressing wear-related degradation. The critical distinction from refurbishment is scope: repair addresses specific failures while maintaining the product's existing configuration. Under the EU's Right to Repair Directive (2024), manufacturers must provide diagnostic tools, spare parts, and repair manuals for a minimum of 10 years for large appliances and 7 years for electronics. Good practice benchmarks show repair turnaround times of 3-5 working days for consumer electronics and first-time fix rates exceeding 85%.

Reuse encompasses the direct transfer of products from one user to another without significant modification. This includes resale, donation, and sharing platforms. The key metric is the reuse rate—the percentage of products entering the secondary market relative to new sales. Leading European markets (Netherlands, Denmark, Sweden) achieve reuse rates of 15-22% for furniture and 8-12% for electronics. The economic threshold for viable reuse operations typically requires products to retain at least 40% of their original value at point of collection.

OPEX (Operational Expenditure) in Circular Models represents the ongoing costs of running repair, refurbishment, and reuse operations—labour, spare parts, logistics, quality assurance, and customer service. Unlike linear models where OPEX is relatively predictable, circular operations face variable demand and quality inputs. Best-in-class operators maintain OPEX-to-revenue ratios between 55-65%, with labour accounting for 35-45% of total operational costs. Achieving these benchmarks requires standardised diagnostic protocols and skilled technicians with cross-product capabilities.

Unit Economics in repair and reuse contexts measure the profitability of each intervention at the individual product level. The critical calculation is: (Resale value or service revenue) - (Collection cost + Processing cost + Parts cost + Quality assurance + Warranty provision). Viable unit economics typically require a minimum contribution margin of €15-25 per unit for consumer electronics and €50-100 for larger appliances. Products with contribution margins below €10 often require aggregation with higher-margin items or alternative processing (recycling, parts harvesting) to achieve overall profitability.

Reverse Logistics covers the systems and infrastructure required to collect products from end-users and transport them to processing facilities. This includes take-back schemes, collection points, courier networks, and consolidation hubs. European leaders achieve collection rates of 45-60% for electronics and 25-35% for textiles through convenient consumer drop-off locations (within 2 km for urban areas). Cost benchmarks range from €3-8 per unit for consolidated collection schemes to €15-25 for individual pick-up services.

Take-back Programmes are structured systems where manufacturers or retailers accept end-of-life or unwanted products from consumers, often offering incentives such as discounts on future purchases or trade-in credits. Effective take-back programmes achieve participation rates of 20-35% among eligible customers and recover products with average remaining functional value of 50-70%. The break-even point typically requires processing volumes exceeding 10,000 units annually for consumer electronics and 2,000 units for large appliances.

Transition Plans outline the strategic pathway from linear to circular business models, including milestones, investment requirements, capability building, and risk mitigation. Under the EU's Corporate Sustainability Reporting Directive (CSRD), large companies must now disclose transition plans for circular economy adoption. Credible plans include 3-5 year timelines, quantified targets for repair and reuse rates, dedicated budget allocations (typically 2-5% of product development spend), and governance structures with board-level accountability.

What's Working and What Isn't

What's Working

Manufacturer-led refurbishment at scale is delivering strong results. Apple's European refurbishment operations, centred in the Netherlands, processed over 8 million devices in 2024, achieving 94% customer satisfaction scores and contribution margins exceeding those of new-device sales. The key success factors include centralised processing facilities with standardised diagnostic protocols, direct access to genuine spare parts, and extended warranties (12 months minimum) that build consumer confidence. Similar approaches by Dell, HP, and Philips in their respective categories demonstrate that scale, standardisation, and quality assurance are the pillars of successful refurbishment economics.

Sector-specific repair networks have proven effective where traditional retail channels struggle. The European Repair Café network now encompasses 2,800 locations across 35 countries, facilitating over 500,000 repair interventions annually. While primarily volunteer-driven, these networks have spawned commercial spin-offs: Repair.eu in Germany employs 180 certified technicians across 25 cities, achieving first-time fix rates of 87% and average repair costs 60% below manufacturer service centres. The model works because it combines local accessibility with centralised training and parts procurement.

B2B equipment-as-a-service models have shifted economic incentives toward durability and repairability. Signify's (formerly Philips Lighting) "Light as a Service" contracts now cover 65 million LED luminaires across Europe, with the company retaining ownership and responsibility for maintenance, repair, and eventual recovery. This model has extended average product lifespans from 5 to 12 years, reduced total cost of ownership for clients by 30-40%, and created a closed-loop system where 97% of returned components are reused or remanufactured. Similar models from Michelin (tyres), Caterpillar (construction equipment), and Rolls-Royce (aircraft engines) demonstrate cross-sector applicability.

Regulatory incentives driving behaviour change have accelerated adoption. Sweden's reduced VAT on repairs led to a 340% increase in repair service businesses between 2020 and 2024. Austria's repair bonus programme, which reimburses up to 50% of repair costs (capped at €200), processed 1.2 million claims in 2024, preventing an estimated 45,000 tonnes of waste. France's repairability index has shifted purchasing behaviour: retailers report that 68% of consumers now compare repairability scores before major appliance purchases.

What Isn't Working

Fragmented spare parts availability remains a critical barrier. Despite regulatory requirements, a 2024 European Consumer Organisation (BEUC) study found that spare parts for 43% of tested appliances were either unavailable, prohibitively priced (exceeding 60% of new-product cost), or delivered with lead times exceeding 15 working days. The problem is particularly acute for mid-market brands and products 3-5 years old—precisely the sweet spot for repair viability. Without reliable, affordable parts supply chains, repair economics collapse.

Consumer awareness and trust gaps undermine take-back programmes. Despite extensive marketing, average participation rates in manufacturer take-back schemes remain at 12-18%—well below the 35-40% needed for programme viability. The 2024 Eurobarometer survey found that 54% of European consumers were unaware of their right to repair, and 67% expressed concerns about refurbished product quality despite evidence showing equivalent or superior reliability. Building consumer confidence requires transparent grading systems, meaningful warranties, and visible quality certification.

Inadequate workforce capacity threatens scalability. The European Commission estimates a current shortage of 175,000 qualified repair technicians across the EU, with the gap projected to grow to 400,000 by 2030 absent significant training investment. Vocational training systems have been slow to adapt: only 23% of EU member states have updated technical curricula to include circular economy competencies since 2020. Companies investing in repair capabilities face annual technician turnover rates of 25-35%, with poaching by competitors eroding training investments.

Cross-border logistics complexity undermines pan-European scale. Varying national regulations on waste shipment, product liability, and warranty obligations create friction that fragments what should be EU-wide operations. A refurbished laptop shipped from the Netherlands to Poland faces different compliance requirements than one sent to Spain, adding €8-15 per unit in administrative costs. Until regulatory harmonisation catches up with Single Market ambitions, operators must maintain costly country-specific processes.

Key Players

Established Leaders

Philips (Netherlands): Pioneer in circular design principles, with over 15% of revenues now derived from circular propositions including equipment-as-a-service, refurbishment, and parts recovery. Their healthcare equipment refurbishment programme achieves 98% functional recovery rates.

IKEA (Sweden): Operates furniture take-back and resale across 27 European markets. Their "Buy Back and Resell" programme processed 5.2 million items in 2024, achieving 85% resale rates and average price points of 40% of original retail.

Renault Group (France): Operates Europe's largest automotive remanufacturing facility in Choisy-le-Roi, processing 20,000 engines, gearboxes, and injection systems annually. Remanufactured parts carry same warranty as new at 50-70% price points.

Patagonia (EU operations via Amsterdam): Industry benchmark for apparel repair and resale. Their Worn Wear programme extends garment lifespans by average 2.3 years and has grown to represent 7% of European revenue.

Caterpillar (Belgium hub): Their Cat Reman division processes 2.2 million components annually across European facilities, reducing customer costs by 40-50% while maintaining new-product performance specifications.

Emerging Startups

Back Market (France): Europe's leading refurbished electronics marketplace, valued at €5.7 billion. Processes 3 million devices annually with standardised quality grading and 24-month warranty, achieving Net Promoter Scores above 60.

Refurbed (Austria): Certified B-Corp operating across 13 European markets. Their 500-point quality inspection protocol has driven customer return rates below 3%, compared to industry average of 8-12%.

Grover (Germany): Technology subscription platform with 500,000 active subscribers. Their circular model achieves 4.2 average usage cycles per device before end-of-life processing.

Murfy (France): Appliance repair network combining platform booking with in-home service. 350 technicians across France achieving 78% first-visit repair success and average customer savings of €180 versus replacement.

Swappie (Finland): Specialised smartphone refurbishment with 650+ employees. Proprietary battery replacement technology and AI-powered diagnostics enable processing of 100,000 devices monthly across European facilities.

Key Investors & Funders

Circularity Capital (Edinburgh): €300 million under management dedicated to circular economy investments. Portfolio includes Back Market, Grover, and 12 other repair/reuse focused companies.

European Investment Bank: Committed €2.1 billion to circular economy projects in 2024, including dedicated facilities for repair and remanufacturing infrastructure development.

Horizon Europe: The EU's €95.5 billion research programme has allocated €1.2 billion to circular economy innovation through 2027, with specific calls for repair technology and reverse logistics solutions.

IKEA GreenTech Fund: €200 million fund focused on sustainable materials and circular business models, with investments in furniture repair platforms and material recovery technologies.

Breakthrough Energy Ventures: Bill Gates-backed fund with €2 billion under management; circular economy investments include refurbishment infrastructure and industrial remanufacturing technology.

Examples

1. Recommerce Group's Smartphone Refurbishment Network (France)

Recommerce operates Europe's largest independent smartphone refurbishment network, processing 2.5 million devices annually across facilities in France, Germany, and Spain. Their 73-point quality protocol has achieved defect rates below 1.8%, compared to industry averages of 4-6%. Key metrics: average device lifespan extension of 2.8 years, carbon savings of 48 kg CO₂e per device, and contribution margins of 22-28% on B-grade inventory. The company has partnered with Orange, Bouygues, and MediaMarkt to integrate refurbished devices into mainstream retail channels, with refurbished smartphone sales now representing 18% of these partners' unit volumes.

2. Bosch BSH Home Appliances Circular Programme (Germany)

BSH operates centralised refurbishment facilities in Dillingen, Germany, processing returned and end-of-lease appliances across the Bosch, Siemens, and Neff brands. Their 2024 programme handled 380,000 units, achieving 82% refurbishment success rates and average resale values of 55% of new-equivalent pricing. The initiative prevented 28,000 tonnes of appliance waste and reduced average customer costs by €240 per appliance. Critical success factors included integration with existing service networks (leveraging 4,500 field technicians for diagnostics and collection), standardised grading visible to consumers (A/B/C classifications), and 24-month warranties matching new-product terms.

3. Renewi Furniture Reuse Initiative (Netherlands/Belgium)

Waste management company Renewi partnered with IKEA and local municipalities to create an integrated furniture reuse system across the Benelux region. Collection points at 180 locations feed three processing facilities that assess, repair, and redistribute items. In 2024, the programme diverted 42,000 tonnes of furniture from landfill, with 67% resold through partner retail channels and 28% donated to social enterprises. Unit economics achieve break-even at €18 per item through automated grading systems and shared logistics infrastructure. The model has reduced municipal waste management costs by €4.2 million annually while creating 340 jobs in furniture restoration and retail.

Action Checklist

• Conduct product-level repairability assessment using ISO 59004 framework, scoring each SKU on spare parts availability, disassembly time, and required tool complexity
• Map current reverse logistics costs per unit by product category and geography; target collection costs below €8 per unit for consumer electronics
• Establish baseline repair and reuse rates; set 18-month targets for 15-20% improvement with quarterly milestone tracking
• Audit spare parts supply chain: ensure 95%+ availability within 5 working days for top-50 failure modes
• Develop or adopt standardised quality grading system (A/B/C minimum) with transparent criteria published to consumers
• Calculate unit economics for repair versus refurbishment versus recycling pathways; redirect products below €15 contribution margin to alternative streams
• Train or certify minimum viable technician capacity: 1 FTE per €400,000 annual repair/refurbishment revenue as benchmark
• Establish take-back programme with minimum 25% participation target; test incentive structures (trade-in credit versus discount versus donation matching)
• Integrate circularity KPIs into executive dashboards: product lifespan extension, repair success rate, take-back volume, and circular revenue percentage
• Document transition plan compliant with CSRD requirements, including 3-year investment timeline, capability milestones, and board-level governance assignment

FAQ

Q: What is a realistic payback period for establishing in-house repair and refurbishment capabilities?

A: Based on European case studies, companies typically achieve payback within 18-30 months for consumer electronics and 24-36 months for larger appliances and industrial equipment. The critical variables are processing volume (minimum 10,000 units annually for consumer electronics), spare parts cost (targeting below 25% of refurbished sale price), and labour productivity (targeting 6-10 units per technician per day for electronics, 2-4 for appliances). Companies with existing service networks can accelerate payback by 6-12 months through leveraging trained technicians and established logistics infrastructure.

Q: How should companies balance repair versus refurbishment versus recycling decisions at the unit level?

A: The decision framework should be economically driven with environmental considerations as tiebreakers. Products with expected refurbished values exceeding 40% of new-equivalent pricing and repair costs below 30% of that value are candidates for refurbishment. Products where repair costs exceed 50% of refurbished value but components retain individual value (batteries, screens, motors) should route to parts harvesting. Only products with negative contribution margins across all recovery pathways should proceed to materials recycling. Implementing automated decision trees based on diagnostic outputs can improve routing accuracy from typical 65-70% to 85-90%.

Q: What metrics should sustainability leads track to demonstrate programme maturity to stakeholders?

A: Mature programmes track five core KPIs: (1) Circular revenue percentage—targeting 10-15% of product-related revenue within 3 years; (2) Product lifespan extension—measuring average additional years of use enabled, targeting 1.5-2.5x original design life; (3) Take-back rate—percentage of eligible products recovered, targeting 35-45% by year three; (4) First-time fix rate—repair success on initial intervention, targeting >85%; and (5) Customer satisfaction for circular products—Net Promoter Score parity with new products. Secondary metrics include technician productivity, spare parts availability rates, and carbon savings per unit processed.

Q: How do warranty obligations differ for repaired versus refurbished products under EU law?

A: The EU's Consumer Rights Directive requires minimum 2-year warranties for all goods sold to consumers, including refurbished products. Repaired products (returned to original owner) maintain the original warranty minus elapsed time, with the repair itself typically warranted for 6-12 months. For refurbished products sold as separate transactions, the full 2-year minimum applies. Many leading operators offer 24-month warranties to match new-product terms, finding that the additional warranty cost (typically 2-4% of sale price) is offset by reduced customer returns and higher conversion rates. Commercial B2B transactions permit negotiated warranty terms, with industry norms ranging from 6 to 18 months depending on product category and refurbishment scope.

Q: What role do Digital Product Passports play in enabling repair and reuse at scale?

A: Digital Product Passports (DPPs), mandated under the EU's ESPR for batteries (2027), electronics, and textiles (2028-2030), will transform repair and reuse economics by providing standardised access to product composition, repair history, and spare parts specifications. For repair operations, DPPs enable instant access to service manuals and component sourcing, reducing diagnostic time by an estimated 25-40%. For reuse, passports provide verified product history that builds consumer trust, with early pilots showing 15-20% price premiums for products with complete passport documentation. Companies should begin DPP implementation pilots in 2025-2026 to build technical capabilities and data infrastructure ahead of mandatory compliance dates.

Sources

• European Environment Agency (2024). "Circular Economy in Europe: State and Outlook." EEA Report No. 14/2024.
• Ellen MacArthur Foundation (2025). "Completing the Picture: How the Circular Economy Tackles Climate Change." 2025 Update.
• European Commission (2024). "Ecodesign for Sustainable Products Regulation (ESPR): Implementation Guidance for Economic Operators."
• BEUC – The European Consumer Organisation (2024). "Durable Goods or Durable Problems? Consumer Experience with Product Repairability."
• Deloitte (2024). "Circular Advantage: European Consumer Goods Sector Benchmark Study."
• European Commission, DG Environment (2025). "Right to Repair: Implementation Status Report Across EU Member States."