This page defines how refurbed calculates and applies seller reserves.
Total Reserve = Rolling Reserve + Dunning Reserve + Seller Performance reserve
Rolling Reserve = Exposure * Reserve Rate
* Dunning Reserve is unpaid invoice amount exceeding payment term, from either marketplace or trade-in program.
Definition
Credit Score
Credit Score is provided by CreditReform in numeric value, ranging from 100 - 600.
- Very Good: 100 - 199
- Good: 200 - 299
- Moderate: 300 - 399
- Poor / Insolvent: 400 - 600
- Missing: 0
Exposure
Seller exposure includes estimated future refund and warranty case value, in upcoming 12 months.
Account active more than 3 months
Exposure is defined by each seller's 12-month selling history, recent 90 days refund rate, and 24 month warranty rate.
Account active less than 3 months
If credit score is Good/Very Good: exposure = gmv x 5%
otherwise: exposure = 5% of recent 45 day gmv + 5% of total gmv
Reserve Rate
Reserve Rate is 100% for the first three month of selling.
Starting from month 4, Reserve Rate = Base Rate + Case Rate Adjustment + Tenure Discount.
Base Rate
| Credit Score | Band | Base Rate |
|---|---|---|
| 100 – 199 | Very Good | 60% - 70% |
| 200 – 299 | Good | 70% - 85% |
| 300 – 399 | Moderate | 85% - 100% |
| 0 | Missing | 90% |
| 400+ | Poor / Insolvent | 100% |
Case Rate Adjustment
Case rate = exposure / 12month GMV
| Case Rate | Discount/Addition |
|---|---|
| Below 1% | -20% |
| 1% – 3% | 0% |
| 3% – 5% | +10% |
| Above 5% | +20% |
* No discount for Band "Poor/Insolvent".
Tenure Discount
| Conditions | Discount |
|---|---|
| tenure > 7 years or Strategic brands | - 50% |
| 12‑month GMV > €10M and tenure > 5 years | −40% |
| 12‑month GMV > €5M and tenure > 3 years | −20% |
| 12‑month GMV > €1.5M and tenure > 2 years | −10% |
| Otherwise | 0% |
* Tenure discount is removed if total dunning amount exceeds €50k.
* No discount for Band "Poor/Insolvent".
Trigger Events
Under these circumstances, reserve rate will increase immediately to 100%.
- Seller credit rating increased to ≥ 400
- Seller or other source mentioned they are considering selling the business to another company
- Seller’s company VAT ID is invalid
- Seller Performance issue, specifically related to
- Delivery
- CS response time
- Other huge negative incidents after validation via refurbed internal discussion via Signal channel
- Significant decrease in sales or stock volume
- (4 consecutive weeks of more than 15% decrease in sales or 1 week of more than 75% decrease in sales) and forecasted future 4 week sales ≤ remaining refunds
- Significant decrease in sales or stock volume