Clover: Certified Refurbished Inventory for Rent-to-Own

Paul Adamson from Clover joins Pete Shau to explain what “certified refurbished” really means—and why it matters for rent-to-own dealers. They break down how returned products move through the reverse supply chain, what Clover’s testing and grading process looks like, where the biggest savings typically show up, and how the new partnership with L2 is designed to simplify ordering and support. They also cover smart product categories to lean into (and a few to avoid), plus how dealer feedback can strengthen quality and reliability over time.

Transcript

Meet Clover And The RTO Opportunity

SPEAKER_01 0:07

Hello and welcome to the RTO show. I'm your host, Pete Shao, and today I've got something special for you. I've got Paul Adamson here from Clover, and he's got some things that he wants to talk to us about. And the truth is, I am been dying to talk to him about it. We got a little we got a little gap there when I got sick, and so uh we didn't get caught up like I wanted to. And now I have the opportunity, Paul's right in front of me, uh opportunity to kind of talk to Paul about everything that Clover has to offer because I we did meet in RTO World last year, right, Paul?

SPEAKER_00 0:36

We did.

SPEAKER_01 0:36

We did. So I there was a whole brand new booth. I was busy as anything because I had we had the live show last year, so I kind of caught him in the beginning and caught him at the very end. Now we're catching up because the truth is there's a lot that he's got going on, including a new partnership with L2 to get some things out to you, but we're gonna talk about that a little bit later. Paul Adamson from Clover, how you doing today? How's everything going where you're at?

SPEAKER_00 0:57

Pete, I'm doing well. Uh, unlike many parts of the U.S. right now, I am uh above the level of freezing and not impacted by snow because I I live in Texas. So we we I can't even say that we got a little cold because everybody would just laugh at us, but we got Texas cold. And uh so I've been you know suffering in my short sleeve shirt, and when I go outside, I you know put shoes on because you know I could I could get a little chilly outside. So trust me.

SPEAKER_01 1:23

We understand. We we definitely understand. So Clover has something a little bit special. Now I've heard these things in the past, but come run to own, you've been here for a little while, you've stuck around. That means that you're serious. Now I'm gonna ask you some serious questions because I really want to get to that, but let's let's start from the ground up. We want to know from the ground up, what does Clover do, and how is it gonna, how do you expect it to impact the RTO industry? Sure.

What Certified Refurbished Really Means

SPEAKER_00 1:49

Um, you know, in a in a few little sound bites, you know, Clover is the returns partner to leading brands, right? So um and I I know you probably have never done this, but somebody in the audience has bought something that they didn't really mean to buy and then they returned it. And that's kind of where my business starts, right? So uh brands like LG, like Brevel, like others, um, need a partner that when a consumer is returning a product, either that they bought online, you know, direct to consumer from the brand's website or through retail, it has to go somewhere. And we are the party that then takes that product, does a certified remanufacturing refurbishment process and then puts it back into the market. Um, so we're we're really kind of saving, you know, doing a few things, right? Protecting their pockets, right? Because that cost to handle returns is pretty high. Um, you know, as US consumers, we uh we return a lot of stuff. Uh safely in the categories we touch, it's typically about 10% of what gets bought gets sold. And and I think we're all a little guilty of the occasional I've had a couple glasses of wine and I ordered that and I didn't check with my spouse. And so it's gonna need to go back.

SPEAKER_02 3:03

Um we need to put that as a definition in the Amazon return box. Too much wine.

SPEAKER_00 3:08

Too much wine. Yeah. Too much wine. It'd probably be shocking how many people would actually check that box, right? So um, you know, so you know, protect their cost to serve those returns, you know, protect, you know, from a sustainability standpoint, keeping stuff out of the landfill. But you know, truthfully, and I think this is where we've loved the rent-to-owned space so much, is um giving a nut the next consumer access to what we like to call aspirational brands at prices that they can afford. Right. So, you know, I uh you know, as a you know, kid of the 80s and 90s, um, there was definitely uh you know a few cars that I would always have wanted, um, you know, or product, you know, a new DVD player. If Refurb had been a big part of you know the 90s for products, I probably could have bought a DVD player earlier in life, right? Then I was able to go afford it. But it wasn't a thing. And consumers are so much more comfortable with it today, right? You're if you have you know any type of mobility product, uh, you know, an iPhone or some sort of Android phone, and it it breaks during the warranty period, if um, you're typically getting a refurbished version as a replacement, not a not a new one. And so, you know, you've got kind of this uh this group of folks that have grown up understanding that to buy a refurbished product is good, not only good for their pocketbooks, good for the environment, and it's just acceptable now. And you know, when we think about like rent-to-own in in kind of this space where people are today, it's becoming even more relevant, right? Because consumers today, they don't think in terms of like ownership anymore. You know, they think they think in terms of like access and flexibility, right? Everybody's got a stream, a streaming service, they're subscribed to things, they have set upgrade paths for their product, and that's how the people, you know, people live today. And rent to own was doing that before anybody else, right? Giving access. So it's it's it's actually really cool to be part of this space.

SPEAKER_01 5:09

All right. So let's go back to the word refurbished. Now, when we say that, just like rent to own, sometimes we've got to battle that term. What does that term actually mean? Because when some when usually when somebody comes to me and says, Hey Pete, I have something refurbished, it means that you were using something and it it it broke, it shut down, something happened to it, didn't work right, they returned it to a manufacturer, it got, you know, a fuse was changed out, a board was fixed, a part was was re you know, replaced or whatever, and then it was sent back out into the retail world. Is that how refurbished is, or is there more to it than that term?

The Reverse Supply Chain Explained

SPEAKER_00 5:44

So I I like to break it down, not to be too nuanced, but between refurbished and certified refurbished, right? So um, you know, you can refurbish a product at your home, right? If you probably every year when you pull your lawnmower out, you go through and you change out the air filter, you drain the gas lines, um, you know, you may clean the carb. That's you are actually refurbishing that mower, right? Maybe changing out the blade, et cetera. But you're not certified by the brand owner to do it, right? So that certification is really the difference, right? It was inspected, tested to a defined standard. Any of its worn or missing parts are replaced. It's clearly graded, right, to the can, you know, its condition. It has performance testing that um is validated by our brand partner, and then it's backed up by an actual warranty. So when you think in terms of certified refurbished, what you're getting is a product that in a lot of cases has gotten more attention than the original new version of it. Because if you think about product coming down an assembly line, human intervention may happen only one in a hundred, one in a thousand units. A certified refurbished product, every single unit is getting touched the same way. You know, in my world, my my world's interesting, right? I'm bringing order to chaos for product that's coming back from these retailers, and I'm building out you know, uh raw goods, my raw good for manufacturing is somebody's returned item. And so I've got to, you know, create systems that allow me to test it and certify it to that original standard that they can then be proud of, right? Because they're putting that that product name never changes. It said LG when it went out the first time, it's gonna say LG the second time. So the consumer who's buying that product, they know it's it's LG, right? And it's a brand they trust, they've built trust in that brand, and we can't harm that trust.

SPEAKER_01 7:43

So help me out here. I want to make sure I got this. Walk me through a product. So I have an LG, whatever the case that is. And we're today, let's just use an LG cell phone. Not necessarily what you're getting, but let's just say it's an LG cell phone, right? I have an LG cell phone, it's not working. I go ahead and do that service, right? So let's say I get another phone, that's working, I'm good, I walk away. Can you describe to me what happens to that phone and the life of that phone as it goes into whatever service area, whatever LG you know provider is, what goes on with that phone after that fact? And then how does it end up at Clover?

SPEAKER_00 8:20

Yeah. So if you think about, and we and we can make it even generically product-based, right? So you are a consumer, you bought an item, you don't want it, you feel it had an issue, it doesn't meet your needs, whatever. You take it back to the retailer. As far as you know, job done, I either have a replacement, I have my money back. That product then take is now entering the reverse supply chain. Everybody understands forward supply chain, right? You know, design and build and distribute and everything else. The reverse supply chain is I'm going from a retailer store to typically a retailer's consolidation uh warehouse. So if you think in terms of big retailers, everybody knows understands. If you returned it to Walmart, it goes from a Walmart store to one of five Walmart consolidated return centers. And they're they're they're scanning that thing, it's moving through its flows that way Walmart can get credit on it from the brand owner, and then it's moving to its next station, which is typically being consolidated with its brothers and sisters and then sent to me for its next uh steps in the process, right? And I'm receiving it, I'm verifying its condition at receipt, and then I'm moving it into an agreed set of testing protocols, and then I'm also replacing parts that need to be replaced and getting it back into the condition the brand wanted it back in market as. Mobility products, like you brought up, cell phones, it's a very interesting one, right? Because that product can go back into market as up to five different grades, right? There's a channel for all of it. Like, you know, essentially basically new, slightly blemished, you know, heavily blemished, a blemish only on the screen, but the rest is fine, all the way through to like heavily scratched up. Versus in a lot of the home goods, if you think about uh the nice thing about a cell phone is you take that item, you talk, you text, you put it in your pocket, right? It's hidden away. If I were to sell you a re-manufactured or refurbished Vitamix blender that sits on your counter, that has to look right, right? So a brand like Vitamix has very defined criteria for the visual and performance of that unit to ensure that you're gonna be proud that it sits on your counter. Other brands may say, I'm okay with one that is good to sit on the counter, and I'll take another grade that they're gonna want to put it away in the cabinet in between uses. Still fully functional, looks great, but you know, when you're walking by it, you can see some scratches.

SPEAKER_01 10:56

Now, is is Clover so Clover is the one that does the testing. So when it comes to you, you do the testing, and when I say you, I mean Clover, uh, and then they give you access to the parts to replace, refurbish, and then test.

SPEAKER_03 11:10

Yeah.

SPEAKER_01 11:11

So we have somebody that is somewhere out there in the ether testing this. Now, to just make sure that we're all on the same page, this is a certified technician. This is some, this is not Bob that we just got, you know, the other days. He's certified in whatever you know model and brand that he's servicing to make sure it's 100%, correct?

SPEAKER_00 11:32

Yeah, I mean, the way you build trust, you know, with consumers in a refurbished product is by having a very rigorous process, right? So our we have, you know, just in the US, not even including in our in our Mexico facility, we've got about 50 engineers. And when a product is going to be brought into production, the they are doing the complete review of their product. They're building what we call a DMI or a detailed manufacturing instruction with visual aids and the complete bomb for the unit, right? So when that product hits the lock the production line, there is a process that is defined for how you test it at the front of the line, how you blow that thing apart into all of its components, where where they go for all their separate testing and cleaning and certifications, and then how it comes back together to be built into a refurbished sellable product. And then it gets you know new labeling and packaging, um, you know, clearly defined as refurbished, right? Because what we don't want to do is we never want to consume, you know, confuse a consumer because that's a that's a terrible experience. If they think they're buying new, you know, you're gonna tell once you open it, it's not, it's definitely it's not new, right? Typically different packaging, right? You don't find you know molded styrofoam in a refurbished product because that's you need big expensive molds, and you're not doing that for your the refurb side. So you want to make sure you're building that trust at all stages and it is clearly defined as a refurbished unit. So that, but you want a great out-of-box experience as well. That consumer needs to feel connected to that product that they paid money for, right? Or they or they you know they rented because they want to make their life better because of you know the product that they got.

Testing, Engineering, And Quality Controls

SPEAKER_01 13:17

So, you know, in the rent-on industry, we want we're always looking for the best price because obviously a rent home is going to be a little bit higher for the services that we include in the agreement, you know, the free delivery, the free service, you know, the ability to pay over a certain amount of time, the same as cash, you know, whatever the case is. So what is what in in a percentage base, what is the difference between one of your certified refurbished products and the same thing that came out of the factory brand new? Is it 25% difference? Is it a 30% cost difference? What what what is it on and I want to say maybe across your three to five most uh usable SKUs that you think rent zone is gonna use, what would you say that the percentage savings is on a brand new product versus what we would get certified refurbished?

SPEAKER_00 14:03

Yeah, so you know the operators in in the RTO space are gonna see a 25, maybe up to a 40% you know delta between new and that certified refurbished, still with a warranty, still with a great out-of-box experience for their for their buyer, their consumer.

SPEAKER_01 14:21

Okay, so what is what is, and let's, I mean, and you I don't know how many you have, because I know you have quite a few. When I went to the booth, there was there was quite a few things over there, man. But let's say we're talking about the top, you know, five things that you have. What can as an RTO dealer, if I went to Clover, what are your five best-selling items that I want to put on my counter that you say not only are they name brand, not only are they certified, but these are probably the hottest sellers that we have going on right now?

SPEAKER_00 14:50

So yeah, I look at it in a from a bucket standpoint of you know, not every refurbished product you know needs to generate a contract, right? Some is for traffic, some is just going to be an attachment sale. Um, we had some of the buyers from the last show that bought them as a thank you for closing out a contract. Um, and so those thank you for closing out a contract were kind of an entry-level neutral bullet blender that you know that from a cost standpoint, they could step into for you know sub-20. Um, very nice, you know, full color packaging, great consumer experience, and it's a great thank you at the end of the day. Um, you know, the other pieces that I think are impactful that we're seeing great traction on is our GE Opal Countertop Ice Makers, right? Because it's an aspirational brand. It has um it is a great product that somebody's gonna want in their home, right? Everybody loves that little sonic nugget ice, right? At the end of the day.

SPEAKER_02 15:47

That that is the now the crack that's going around.

SPEAKER_01 15:50

I mean, when people want something really, really bad. You know, it used to be like Tickle Miomo. Now it's like the ice machine. My wife's even talked to me about it. Like it's those little those little cubed icy. I hate to say it, but I use it too at work. It is so good, though.

SPEAKER_02 16:02

I agree with you. Paul Paul's got Paul's got the deals. Paul's got the deals, guys.

SPEAKER_00 16:07

Yeah, it and it's a great product, right? And being able to take advantage of that is a huge thing. So GE Opal Ice Makers. Um, the other thing that I think is a great you know, benefit to the RTO space is uh room AC, you know, because um you know folks you know they want uh air conditioning when it's important to have air conditioning, right? What you don't necessarily need is air conditioning now, but come June, July, August, you do. And so being able to provide something that is can be a shorter term rental period um at a better price point, I think is a huge win for RTO because you know it's it's a it's a strong product category. It typically has a higher MSRP. Being able to save money on the front side allows them to maybe change up the economics for that rental period, you know, that whatever that uh rental rate is gonna be, um, and still deliver a great product to their consumer. So, you know, the the other pieces, and we've had some, I'm not gonna call it mixed reviews, but really it's depending on, I think, geography is our floor care items. You know, one of the fastest growing categories in floor care is uh floor washers, so items that can vacuum and essentially clean the floor at the same time. Uh typically have you know built-in heaters, so they're applying hot water, you know, with detergent to the floor to do your cleaning. And we've seen some of the RTO space loving them, saying it's a great product, and others are like, eh, you know, they they forget to clean out the unit, then it comes back, and yeah, now I've got a I've got my staff cleaning that thing before they can rent it again. So, you know, I think for us where we're gonna spend most of our time is in that premium countertop appliance space, right? So um, you know, the nugget ice makers, uh the higher-end espresso machines, um, some of the more durable home items, so room ACs, so portable or window ACs. Um, and then we're gonna be looking to bring on additional, you know, call it, you know, just um attachment sale items, you know, some of the blender products that work really well. Um, you know, for us, we are we're Vitamix authorized reseller for the uh refurbished product into the rent-to-owned space. And so being able to give a great value on a$700, you know, countertop blender, it you know, that it can be purchased for several hundred dollars off is, I think, a big win.

Pricing Advantages And Top-Selling SKUs

SPEAKER_01 18:40

Hi, I'm Pete Chao. You may know me from the RTO Show podcast, but today I'm doing something a little bit different. April and Wild Brands have launched a special project to bring the story of our industry to life like never before. They've asked me to sit down with some of the true legends of Rent to Own, capturing their stories, their impact, and their vision for the future. And now I get to share those conversations with you straight from the legends themselves. All this leads to something groundbreaking, though. A new book. The Rent to Own Revolution, a definitive history of advocacy and consumer access, written by April CEO Charles Putterman and WoW Brand CEO Brian Kraft. The book explores the grassroots of RTO, the advocacy that has defined it, and the future that we're building together. Here's where you come in. We're giving away free copies once the book is released. Just head over to RTORevolution.com and sign up for a chance to receive a copy in early 2026. Don't miss the chance to be among the first to hold this piece of RTO history. That's rto-revolution.com. Check it out and become a part of RTO History. When you say the word refurbished or certified refurbished, it means to me, in my head, this is the way I see it. There is a certain supply that comes back, like you said, maybe 10% that comes back. So if I sold 100, I would get 10 back. Now, let's say that I've got a few dealers and I'm standing in front of a few dealers and they're like, hey man, I really like this product. I love the ice machine. My wife told me that I got to have that. I love the giveaway idea, I love the room AC, I love the espresso machine. Now, let's say that catches fire, right? Everybody's excited, everybody wants to buy it. But how is the supply versus, you know, if I wanted new, and I'm just saying, and whether you buy containers or you buy shipments, you know that it's going to be manufactured and sent. That's the way it works. With refurbished product, there is no guarantee that it, you know, if let's say it's like Toyota, it's just a great product, it doesn't come back very often. What do you do in that sense? I mean, how do you, how do you judge what's going to be bought and how much supply you have for the demand that you could be creating?

SPEAKER_00 20:38

So um we do a lot of work you know with our clients ahead of time, right, to understand what is the their uh their forward-looking 12-month sales plan by SKU, by channel. And we have the information to help us understand by retailer what their average return rate is by category. And so we can actually predict and forecast out what their returns are gonna be all the way to a single SKU level. And we also know the return patterns. We know when returns are heavier. I mean, easiest thing to relate that back to is room ACs come August, September, October. I'm getting 85% of everything I'm gonna get in a year in that period, uh, with probably 50% of it just coming in September. But you know, other items are less seasonal, right? I mean, a neutral blender has relatively consistent return rates. Um, but we also know because hey, they sell at Costco, they sell at Target, they sell at Walmart. We know which ones have a longer return tail, right? So Costco, very much in favor of their warehouse members. You know, if you have an issue, they're gonna they're gonna take that product back a year down the road, two years down the road, wherever. So I've seen that.

SPEAKER_01 21:49

I don't know if you've seen that. I think a lady returned to me like nine years later with a receipt, and you're like, lady, stop it. Exactly.

SPEAKER_00 21:55

You know, and I look, I I can't hold on to a receipt for a week. I don't know how these people are able to hold. On to a receipt for that long. But you know, they they're taking care of their warehouse club members. And so we're able to map and be very realistic about what we believe can be sold into the channel. Because what we don't want to do is we'd never want to, you know, have a dealer stuck. Right? Hey, I was relying on you, Paul. I was relying on Clover to make sure I had this amount of product for my stores this season, and you came up 50% short. You know, that that's a leaves a really bad taste, you know, in somebody's mouth when you're starting a relationship. And you know, so yes, we don't control sales or returns, but we have enough legacy information to say consumers are pretty typical, they're gonna return this much across these channels. We're gonna have this base to go work from. We already know all of our recovery rates, you know, by SKU. I can tell you, hey, this product yields this much sellable product at the end, um within probably five percent accuracy.

SPEAKER_01 23:07

Wow. Yeah, that's that's that's pretty good. Well, my qu the questions that I really have that's that's worrying me, okay. Let's say that you have a product, and it's it's good. It's a good product, and I'm not gonna mention any names, any, you know, it just is what it is, it's a great product, and you have a good steady return flow, whether it's uh refurbished uh because of non-use or you actually have it broken, whatever. But so now that it's there, where does Clover fit into the this has a particular high failure rate, regardless of the fact that I'm bringing it back and I'm doing a 100% certification, and then now it's one and now it's back to where the the manufacturer's specs are and I'll put it back out there. But the failure rate is still regardless, is still kind of high, right? So you say 10%, maybe this one has a 20, 25%. Where does Clover say, wait a minute, you know, even if we refurbish it back to there's a chance that, you know, one in four coming back, that's a little bit too high? Or what are the thresholds for that for you to say, you know what, we don't want to put that out there at rent-to-own because you know they do have a tendency to take things. Certain things do come back and they get re-rented, right? Even if we do uh something like you we try to we will add that time, try to do our own cleanup and make sure it works, but we're not as certified as some of the guys at Clover, so we're gonna put it back out there. There's a high failure rate, it's just gonna cost time and money to go back through there. Where is that line drawn where Clover says, hey, you know what, this is probably not going to work? Or how do you get notified that this is one of those items that, hey, is starting to have a very high failure rate? How would that work in this situation?

Supply Forecasting And Seasonal Flows

SPEAKER_00 24:40

So break it down into a couple pieces. One, um, because of the categories that we work in, they tend to be longer life in field, right? So um, while your tablet phone or laptop gets changed on a very regular basis by the brand owners, um, you know, an air conditioner, you know, might have originated in 2020 and is still the current model that's sold. So, you know, the longer it's in field, the longer you find any of the issues. So, you know, that said, um, we typically have visibility to, if we break this down into what we call the known knowns. So that is they, you know, they've already known about the issue. Hey guys, just look for this. When this happens, you need to replace this part. Great. Thanks for that, you know, heads up. Then there's the known known unknowns. Hey, we've been hearing that there's an issue with this. Could you help us figure out what's going on with it? And then where we come in, and I think the greatest benefit we bring to our brand partners is helping to identify the unknown unknowns. Right. So through our testing, we identify this is we see this failure, and it's not just a one in a thousand. We're seeing it one in a hundred, one in sixty. So that's when our engineering team gets engaged, right? So we can divert product in the flow. Now, what does that really mean for a consumer? Ultimately, what it means is we are essentially creating a better product through refurbishment than new, right? So actual failure on new products, we they've gotten good. Even your cheap product today is relatively reliable, right? Not necessarily for you know you're not gonna get uh a washing machine that lasts 20 years like when we were growing up, but you know, you are gonna have for the most part product that is sub-4, even sub-three percent actual failure rate. Refurbished product is typically sub-1.2, right? So because we're weaning out product that shouldn't go back, and part of that could just be because we're evaluating it, how heavy was its use during its period. Oh, yeah, this this has obviously had some use, but no matter what we replace on it, not going to be the best thing to go back in the channel. Or this is two generations back. You see that a lot in window ACs. You know, the only thing that changes is a couple codes in the model number. And that's just really telling you when was the design for that product brought to market. But they you still see them getting sold. But we're like, uh, the design's older now. It may be less efficient. Uh, we're typically looking for endemic failures. So our team, our BI team, is constantly monitoring all the quote unquote failure information that we capture. It's really telemetry information, right? So we take product, when it moves into the testing process, we make it so it's less human dependent and more automation dependent. Right. So, as an example, people, everybody understands a vacuum, right? They've had a vacuum in their whole life in their homes. You know, when you talk about vacuums, a lot of times your suctions, uh, you know, one one of the uh standards is related to what what they call water draw. It's like how hard can it suck, right? How how bad does my vacuum suck? Or how good, right? At the end of the day. So we have we know the standards. So we can performance test something at the front of our line to determine the use of this. We can look at its, you know, basically its running amperage for the motor, you know, to decide, you know, is it off spec and weed that stuff out right away so it doesn't go to a future buyer. Because again, the worst thing that can happen is that new buyer, that refurbished product, has an out-of-box experience that is less than worthy. Because at the end of the day, that may be their first time buying a GE Oval ice maker. And now they're like, oof, this thing's a little tough to set up or it's making a weird noise or you know, whatever. They're they're never gonna buy a GE product again.

SPEAKER_01 28:51

Well, I mean, that's kind of rough on the RTO dealer, too, because you're gonna be like, well, I got this product that doesn't work. You sold this to me, and look what's happening, look what I got to go through. Uh, I don't trust you. Even if everything else I get from you is new, now I've got to worry, is it all gonna be the same, even if it has nothing to do with the RTO dealer? Which leads me to this part now. So I know that warranty is different with new product, right? New product. I mean, I just you know, my wife got a car not that long ago, and we you know, 10 year, 100,000, whatever, whatever.

SPEAKER_03 29:20

Yeah.

SPEAKER_01 29:21

When you do a recertified refurbished, I don't think there's a 10-year, 100,000 mile refurbishment uh title on it. So, how does it work? If I'm an RTO dealer and it's sitting on my counter and I'm looking to sell that, does it go from the date that I receive it in? Does it go from the date that it's sold? And how long does that warranty out there before I can, you know, not make a claim on it?

Failure Rates, Telemetry, And Warranties

SPEAKER_00 29:43

So RTO is similar to any of our other uh business-to-business channels. So what we do is the clock starts when we ship it to our partner, and that and that magic number is a year. Now, there's a 90-day warranty from the time they first push it out into the market. So if at day 360 they finally rent that item out, it still has 90 days of warranty beyond that. So it's 90 days in the consumer's hand. We give like one year of runway for the rent-to-own uh dealer to get it into market. So it should give them plenty of coverage. The beauty is returns happen on the refurb side within the first 30 days, over 93% of the time. So, you know, it's kind of one of those things where it's it's good at breakfast, it's gonna be good at dinner, right? That type of thing. You know, you don't have to worry. Um, and again, that you know, from a failure rate being you know less than a third of what new product is, the dealers are gonna be in a really good spot spot with the warrant from a warranty perspective.

SPEAKER_01 30:51

No, I've had I've had a couple of good situations and a couple of bad situations. So I'm not gonna mention the brand that I'm gonna talk about. There's a couple brands out there, but I've had some new product that come in, and man, you know, it's it's it's either bad in a box or bad within the first week. And you try to get a hold of the dealer and it's just like pulling teeth. Uh, you know, it's it's just difficult. You finally get it done. Um, and it just seems like it took way more time than it should have. A lot more was gone into it to get that done. If something happens, let's say within the first 90 days, I've got this ice maker out there, it it either works or something happened, whatever the case, and now it doesn't. It gets brought back to me. What is my position and what do I need to do? Because that plays a big part in whether I'm going to carry a product or not. Can I get it taken care of and can I get it taken care of with enough time for the customer to be satisfied? Because let's say I don't have another one, right? I mean, if I have two, three, it's great. I can just take it, swap it out, or I could just take it and say, hey, use this one until. If I don't, right, because let's say I'm trying it out. I I I bought five different items from you, none of them are the same thing. Ms. Jones comes in and now it's not working. I need to get that back to her as soon as possible, which plays a huge part in the rent to own because our service is built into the agreement. How does that work? How do I get a product in that may be malfunctioning for whatever particular reason? What happens then? Is that a call back to the manufacturer? Is that a call to Clover? Do I call a Paula, you know, on the bat phone and be like, Paul, this is this ain't happening, man. What's going on? Help me out. Like, how does that work out?

SPEAKER_00 32:22

I mean, I do keep a red phone on my desk just for these emergencies, but um yeah, and you alluded to it earlier, right? We announced a partnership with L2 specifically because they've been engaged in the RTO space for so long. So, you we are, I'm gonna call it in the in the arc of rent to own, we are just young, right, in our engagement with the space. Um So we wanted to partner with somebody that could handle the distribution, it knows the the players and the dealers really well, understands their needs in order to offer the best overall experience for the dealers, right? Again, I go back to the trust piece. Our job is to ensure that the consumer's trust in the brand is never impacted. L2's job is to ensure that the trust the dealers have in L2 can't be impacted. So when it comes to that bat phone part of it, right, it's gonna be L2 that's gonna be managing that piece, right? They have they already have the system set up for doing that. Um, and so I think that's gonna bring the best value is you take, you know, we're you know, Clover's 2,000 plus you know employees, right, processing millions and prom millions of units a year. L2 is laser focused on distribution into the rent-to-owned space. So take what we're great at, take what they're great at, and it should be an amazing experience for the dealers.

SPEAKER_01 33:53

So what I was reading here, it looks like some of the some of the main products that we're carrying through L2 is the portable ACs, um, the vacuum cleaners, the stick vaccines, uh, the LG, and and I don't know if I'm saying this. Is it Tinoco, Tynco? How is it?

SPEAKER_00 34:08

Yeah, it's Tineco, yeah.

SPEAKER_01 34:10

Tineko, there you go. I got I'm learning, guys. I don't know that one. Yeah. Uh I actually own one. I don't even know how to say it.

SPEAKER_00 34:15

Um, nice.

SPEAKER_01 34:17

Blenders and juicers uh from the Neutra bullet, and you got some countertop appliances from GE. Now, when it comes to ordering those things, now that you're through L2, because usually I would give them a call and say, hey, I need a couple laptops, need a couple gaming systems, what do you have on, you know, what do you have on deck? They would say, Hey, listen, I've got this one with this spec, this one with this spec. You know, I you can order two, ship out. I mean, what does it take to get those orders done? If I was to call L2, is it a shipment amount? Is it a certain amount of pieces? How does that work?

Returns Handling And The L2 Partnership

SPEAKER_00 34:45

And that's part of why we wanted to partner with them. They're much better at doing um mixed product shipments than we are. Our warehouses are very much set up to do full pallet or single piece, not mixed pallets of product. And so L2 is going to be taking stocking positions on the product so that um, you know, kind of the day-to-day orders uh just fulfill it. The larger ones, they will then be tapping in and we'll be doing direct shipment out of our warehouses for them on that product. So I think it really covers the bases really well because it allows them to continue on the relationship side, you know, managing the the dealer relationships, providing them not only, hey, I'm calling for a couple laptops and a couple of displays, hey, could get a couple GEOPA icemakers on there. I need three portable ACs. Now you get one palette coming to you and it has all that for the dealer. And that's such a better experience, right? Um, and and that's what we needed to be able to tap into. You know, our portfolio product that makes sense for the rent-to-owned space isn't as broad, right, as a distributor. So I think it's gonna work out really well. You know, the L2 guys know the space really well. We know our industry, and we're gonna give great product that they can then distribute and support.

SPEAKER_01 36:04

Well, I'll say, I mean, you do have a great partner. We've we I've seen L2 around for years and years, and we've done business, a lot of business throughout those years. So that brings me to my next point. I haven't known Clover for years and years, though. So where does what can you give me a little history on Clover? Because you know, a lot a lot of times what people don't want to do is say, hey, I see something new, but we've seen people go to trip. We've seen people go to the RTO world, they've been there a year or two, and then what happens? I don't know. You know what happened to that guy? I don't know what happened to that guy. And you know, might have had a good idea or whatever, but I can always tell you it takes about 24 months to really break into it. And some people just don't have that staying power. What is the history of Clover? Where does it come from? How long has it been in business? What are we looking at when we say Paul is the chief, well, chief revenue officer, right? Is that the CRO? Is that what they call you now? The CR. So you know, best of all, how long, what's the longevity of Clover? Where has it been and where is it going?

SPEAKER_00 37:01

Yeah. So, you know, they we are celebrating our 30-year, 30th year in business this year. Um, the Clover business has changed dramatically over the years, right? So there's, I'm gonna call it two ways to look at our business. You know, we are the full name is Clover Environmental Solutions. At the end of the day, we're helping companies, you know, uh, you know, properly receive and uh manage and dispose of commercial and consumer products. One of the biggest things that we do is we have a sustainable imaging group. So our sustainable imaging group is the world's largest remanufacturer of ink and toner. So every private label brand that you can buy at Staples, Office Depot, Walmart, etc., we remanufactured. That that came from us. Um and it just ends up back on our retail shelf.

SPEAKER_01 37:58

Anthony, do you have any do you have any toner that you need? I got the hookup. I got the hookup over here.

SPEAKER_00 38:03

I got you covered. Got you covered. Yeah. It and you know, it and so you think about the um the pressure in that space. You know, Clover history comes out of uh you know managing products that are you know have a lot of IP around them. Um and so you know the engineering that we have built internally and the automation that we've built springs from that. The um the consumer product side is uh been in place for about 12 years and really branched out into these adjacent spaces in 2023 through an acquisition of a company that had been around since 2002. So there's a long history of performing at a very high level across these consumer products that people are already shopping today, but they just don't realize you know where it you know where it came from. Uh you know, when when you look at you know a product and you're like, oh, I didn't realize those were interchangeable. You know, one says it's supposed to be from you know uh Honda, but it's going in in Acura. Oh, okay, that's right. They're related companies. Similar to us, right? You know, we are really um the the uh the horsepower be behind a lot of remanufacturing that goes on here uh in North America.

SPEAKER_01 39:24

You know, there's something that's going on right now, and uh, you know, some people follow it, some people don't. It is what it is. The tariff situation has gone up and down and up and down, and right now I think it's down, and I think they're trying to figure out how to get back up. I have no idea how that's gonna work out. But in the in the choice of that situation, when you have brand new product that has the tariffs and stuff like that, how does Clover react in those situations? Is it something, is it, is it a better ball game when you hear, you know, everybody's going, God, 20%? What are we gonna do? Is that where Paul goes, yeah, I got you? Or is it it eventually comes down to you like, no, I don't want none of that. So I mean, how does that affect the business? How does it affect an RTO dealer if somebody says, hey, now we got a 20% tariff on wherever these things are coming from? You know, because you're getting it on the back end and providing the parts and the check or the refurbishment certification, it it does your margin get better? Does it go from 20, you know, 20% to 25% difference, or is it the same and it kind of ebbs and flows with the brand new price of the product?

Clover’s History And Scale

SPEAKER_00 40:28

So, you know, a couple things. We'll talk about you know the impact of tariffs. So, you know, my my teams are both on the acquisition side, right, business development, and the sales side of the finished product. And, you know, the biggest message we could bring to the brand owners who weren't already doing refurb or remand was you've already paid for the product to be here. Why wouldn't you want to figure out a way to monetize it again, right? Sunk cost. It's already here. Let's transform it and build a secondary channel for it. Especially when tariffs are high. You already paid a bunch. And maybe even your container costs were probably out through the roof as well. Not as impactful if you're bringing a whole bunch of Nintendo Switches in the country. Super impactful if you're bringing air conditioners in the country, right? From a container side standpoint. Absolutely. So it it becomes more important. I would never say that a an industry is recession proof or you know, volatility proof. But you if you think about returns, refurb, reman, when when the when there's tightening up of an economy, people want to figure out a way to save money. Refurbished products make more sense, right? They see it as a value add. I can still get the product I want, I get it at a reduced cost. Times are great, and people are like, I got a bunch of disposable income. Well, they buy more, more stuff gets returned, and you still have buyers that want to do the right thing, right? I mean, Gen Z loves refurb. They understand the value of sustainability. They look at it as hey, I want the flexibility of partnering with a comp a brand that has the same thoughts as I do when it comes to what we're gonna do to you know uh manage our place in the world. So, you know, tariffs not necessarily a bad thing when it comes to the refurb side. When you talk about pricing, we tend to uh essentially do everything as a percent of the standard retail price. Now we take into account do our partners have a map policy or no map policy? Because at the end of the day, if they don't, well, we need to make sure what's the real price this product is selling for new. Yeah, it they may say, hey, it's$3.99. Yeah, I'm finding it everywhere for$249, right? So that's the price we're gonna go off of. Um, but the gate, the thought is velocity, not gouging. You know, for us, the you know, the benefit to our clients isn't just in creating new revenue streams. It's also the access to the data that we give them related to the consumer experience of that product, right? Every every return at the end of the day, in theory, is because something was wrong. They made a maybe it's just they made a wrong buying decision, but also it could have been they didn't understand how to set up the product. You know, it didn't meet their expectations from a performance standpoint. Well, does that mean you need to change your listing online for that product and how you describe it? Um, for me, you know, I got my glasses on, I take them off, I have a hard time seeing you. You know, I go look at labels sometimes or instruction manuals, and one of the best first feedbacks I give to my clients is your stuff's printed in six-point font. Like even my glasses on, I'm having a hard time seeing that. So the ability to give them feedback on their product, usage, you know, basically condition after you know being in the field for one month versus six months versus you know a year, that's highly valuable. So we help them understand. And the fact that the product they're getting back, there's no better way to inform your decision for your future product than looking at the product that's getting returned. And so for the consumers in the rent-owned space, we're going to help de-risk them from an inventory standpoint from a cost during times of volatility, right, in market prices. You know, yes, you could see it creep up a bit, but at the same time, we don't creep if it goes up 20%, we may be going up 2% or 3% right on the sale price of that product.

SPEAKER_01 44:29

Okay.

SPEAKER_00 44:30

Um, yeah, because again, keep the product moving is more important than trying to optimize the recovery dollar.

Tariffs, Economics, And Data Insights

SPEAKER_01 44:39

Hey everyone, it's Pete Chao here from the RTO Show Podcast, and I want to tell you about a company that's making a real difference in the rent-to-owned space, WoW Brands. I've seen firsthand how they approach marketing. Let me tell you, it's not just about ads. WoW Brands builds complete digital ecosystems designed specifically for the rent-to-owned industry. Their e-commerce and lead generation strategies are built to bring qualified leads. And did I mention that they are actively working with the rent-town industry while also being members of APRO and Trib? Listen, these folks are passionate problem solvers. They don't just slap something together, they design, build, and scale the kind of digital retail tools your business needs and your customers actually want. So if you're serious about growing, reach out to WoWBrands at WoWBrands.com. I trust them, and I think you will too. So what categories then is Clover getting into? Because when we're talking about, you know, at the end of the second quarter, going into the third quarter, you want to know what's coming up, right? You want to know what to be able to pre-sale your customers and say, hey, I heard this was coming down the pipe. This is not something that you were able to get last year, but this is something that you can get now, right? So I'm going to push those sales. I'm going to try to put it in my flyer. I need to, you know, go in like really 12 weeks out from Black Friday. I need to know what am I going to put in there? How am I going to design it? What looks good. Is there anything that comes up when Clover says, hey, this is my lineup? How do you know what's coming up new? And do you are you expanding into new spaces where Clover can say, hey, this is not something that we had before, but we're getting there now? I mean, you let me know. Where how does that work?

SPEAKER_00 46:11

Yeah, so we have um kind of what I'll call our home base of categories we work in, right? And so, you know, that's typically floor care, premium countertop appliance, home environment. Um, and where we're growing is in home automation and uh some kind of general consumer electronics, right? So I'm not going to be the RTO dealer's best friend for Xbox and PS5s, but where we are growing into TVs and sound bars, which, you know, after going to RTO world, I did see that there was a bit of a a need on the sound bar and sound equipment side specifically. I felt like that was a bit underserved and there was a lot of folks very interested in it that would stop by our booth. Um the other pieces, you know, looking at that TV space, what I don't know yet, and this is part of why I'm very excited to go to the Trib Show here. What was it less than a week away? Um, to understand what size TVs are people most interested in in the R in the RTO space. You know, is it just 55? You can have a more standard set, or do we want all the way up through 85s and heck being at CES this year, right? 120 inch TVs are coming. Right. God, yeah.

SPEAKER_02 47:30

I I wish I I wish I could. I don't know if I have a wall that big, but I wish I could.

SPEAKER_00 47:35

Yeah, I at that point just get an ultra short throw, you know, projector.

SPEAKER_02 47:39

You know, you know, I so I so agree with that too, but yeah.

SPEAKER_00 47:42

And that is, and that's another category, right, that we're looking at. And I I I go there almost from a wanting to learn more. You know, I it's very educational to me. Omaha was super educational uh this past year. And every time I go, I get a better understanding of what the dealers are hungry for, right? Things that they know that they would love to have, you know, uh in their inventory. If I can de-risk them from a st a cost standpoint, maybe they want to take a better position on it that you know, because they don't feel as uh that they're really going out on a limb so much. And then I can turn back to my business development team and say, hey, who are we talking to that fits this need, that this space, right? So then we can go to a potential client and say, not only can we handle the returns, but look at this amazing channel that is available for you to sell your product into. And I think that's been for us um such a positive because so many brands, certain brands, they just don't want they don't want to see their product back on Amazon. They don't want to see it on eBay. But telling them that, hey, I've got this great offline channel, you know, that hits a new consumer base that essentially gives them an access point, an entry point to your product in your brand, they go, oh, that's super interesting to me. Because either they haven't sold there historically, or they just see it as an underserved channel for them. So we can bring that to them. So, you know, TV soundbar, right, is gonna be, you know, one area we're looking at heavily for everybody. I don't picture that you know, things like home automation, you know, you're not gonna, you know, I don't think the dealers are gonna want, you know, um, you know, smart locks and stuff like that. Probably not a big mover for them.

SPEAKER_02 49:27

Um maybe Yeah, we well, you don't want to be, yeah, when you're renting a product like that, you don't want to say, well, my lock failed and somebody walked in my house. You know, that's your fault. Take away from that one. Yeah.

SPEAKER_00 49:38

Yeah, and it and if yeah, and if the contract ends badly, you know, then you gotta go collect a lock off a door. Right. That just sounds terrible.

SPEAKER_01 49:46

You know, I mean that just that is a bad thought. That is a terrible thought.

Categories Expanding: TVs, Soundbars, Coffee

SPEAKER_00 49:50

Yeah, but we're we're gonna keep spending you know pushing into more premium coffee products. You know, I think that's a really aspirational brand. Coffee is such a big category for people. Um, it's a money saver for the consumers to be able to say, hey, I've got this coffee addiction, you know, and you know, hand of God, I do as well. Can I just spend$2 a day to fill it versus$7 a day? And that's a huge win.

SPEAKER_01 50:16

Yeah. No, I uh well, I agree with that because listen, right now the cost of everything is going up, and the further that it goes up, the more, you know, what we're getting paid is just not following with. Unfortunately, that's just the way it goes, and we've got to find a way to negotiate our pricing as best as we can. And that's usually eating at home, you know, going to the grocery store versus going to uh the you know the restaurant down the street, and it makes a difference. So, how long have you been with Clover?

SPEAKER_00 50:44

So Clover uh bought my company in 2023. So I was I I was an addition in June of 2023, uh, you know, coming from a company that I didn't start, but I I uh was a uh partner in uh starting back in 2017. But I'm I'm a reverse supply chain nerd. I've been doing this now for 33 years. Um, it's all I know. My poor wife, you she we can't go shopping without me being like, I don't know that brand. Hold on, let's go look at that, you know. And so she's usually that's too expensive.

SPEAKER_02 51:20

I can get that somewhere else, babe.

SPEAKER_00 51:21

Oh, that's the worst part. I literally will always be like, I'm sure I can figure out who does the refer for them. Let me go, you know, let me and she's like, Can we just not buy it new? Please, can we just not buy it new? I'm like, okay, fine. You know, but it it's such an exciting space because it's so different, right? Everything that we're doing, you know, checks all the boxes, right? Good for your pocketbook, good for the planet, good for people, right? And so check, check, check. I mean, I'm not saving babies, I'm not trying to say anything like that, but what we are doing is we're providing a valuable service to our brand partners, but also to the consumers that get to take that product next. And I think that's probably one of the most important things, right? So, you know, the rent-owned dealers, we want to help them reach younger customers, right? The ones who care about, you know, sustainability, you know, it's kind of built in their DNA now that they align with brands that are sustainability focused. We want, you know, to be able to give them really good premium brands to put in the stores. We want to help them protect those margins. And if it makes sense, tell a sustainability story. Right? Talk talk about the fact that, hey, what you've just bought or rented, here's how it got to you. Right. And starting with the fact that, hey, you know, it it's all been tested. It has a warranty. You can be confident in it. You know the brand's only going to choose a good partner because they care about their brand. I think that's I think that's the win. I really do.

SPEAKER_01 52:52

Well, you mentioned earlier that you know you have to be able to have some feedback and it goes back and forth between Clover and the dealer, uh, as far as uh whoever it is that's selling to you, whether it be LG or GE or whatever the case is, and you go back and forth and say, hey, this is something that we've seen coming up, or they come to you and say, hey, this is probably an idea of what we can think of because of this part, whatever the case is. Where did that work the same way with the RTO dealers? Because sometimes, you know, one of the things that makes a dealer feel more secure about the products that they have is being able to go back to the manufacturer and say, Listen, we beat it up probably more than a lot of other people do, or at least we get the feedback from it because we do get returns. There are some people that buy new, it doesn't work, they throw it in the trash. They don't ever say anything to anybody, they'll tell their friends or whatever. But if we're doing constant returns or we're we're in contact with that customer every single week, bi-weekly, monthly, we have that relationship. And if it's not working right, believe me when I tell you, before they make that payment, they're going to let us know hey, this ain't right. So is there a line that goes back and forth between the R2, you know, dealers, the the ones that are on the front lines and Clover or L2 or however it works to say, hey, we see something in this product and it might it might need to be addressed, or is that not something that is available?

Building A Dealer Feedback Loop

SPEAKER_00 54:06

Um, Pete, you might be on the payroll soon. So shame on me that I've not thought about that one. That is so like we we have services that essentially scrape uh reviews, um, you know, and um and NPS scores and everything for the products that we touch. What I don't have, and because so much of what we sell either goes through a marketplace or goes through you know into a value retail or et cetera, we don't get a feedback loop like that. But to have access to something like that, we could formalize in a way that you know maybe it's a monthly or a quarterly, you know, put push to the dealers that bought product to give feedback on it would be monumental. Like my I know my brand partners would eat that up because we could then turn that into actionable engineering projects either internally or back with our brand partners. And you're right. I mean, I I'm the toughest tester of our product, right? You know, I'll have stuff shipped to my house. I think my wife's tired of how many blenders we have, how many vacuums, etc. Um, but it's because I want to make sure that what we're putting out, and it's always blind, right? I don't tell my teams that I'm ordering one in. I want to know what what was my out-of-box experience and can I find something wrong with it? But having a you know a direct connection with the the dealers that's huge. Yeah, I'm I'm gonna be figuring that one out over the next week and you know, talking to the team that you know while we're with L2 at the booth next week.

SPEAKER_01 55:35

Well, I mean, it it's it's something that we've had to, you know, and some other dealers have done it, and I know it resonated well with people who are taking in products that they're not 100% sure of, to be able to say, listen, um, I don't know exactly how this is gonna work. I don't know how this is exactly gonna land, but if I have somebody's ear to know that I have a say and maybe it's it's going this way or it's going that way, and we can change that to be better off for the customer, better off for the end result for the payoff in three months, four months, ten months, whatever the case is, you know, whether it's uh you know, whether it's a hotline, whether it's an email, I know that the dealers felt so much better in being able to say, hey, I've I've had three of these and three of these consistently, like right at day 31, you know, whatever the case is. And I'm not saying that's that's it, but you know, whatever the case is, they they can say and they they see it because it can possibly go out and come back and go out and come back. And so it gets worn and utilized uh in different ways by different people. And then that same product finally comes back and they say, Man, I I remember cleaning this, I remember doing this, it indented here or stopped there. Um, and being able to say, Hey guys, this is something that's really, really important to us.

SPEAKER_00 56:40

So, Pete, let's pull on that thread for a second and put you on the spot. So, what do you think is better for the dealers? Um, kind of a dedicated email that would could go with every product, a little sticker on the outside that says, Hey, you if you ever have any questions, concerns, and want to give feedback to Clover, send an email to this or a monthly survey that we would send out to the dealers that bought product to say, hey, to give feedback. What what do you think would resonate better?

SPEAKER_01 57:04

I'm gonna be honest with you. So it's made up of a lot of smaller dealers. So, unless you're literally talking to Aaron's or Rena Center, you have so many people that do so many different things. So out of a few thousand stores, you have a big RTO dealer would be like a hundred, right? Or two hundred. That's not you know the same as the rack and the errands where you're in a thousand mark. So if I had to say, I would say both. I would say if you can set up an automated system to drop on the first day or the last day of every single month just to send out that that thing for the the RTO dealers that let's say if I have one to five stores, I might be running around and doing 10 different things every single day, and it just might not be on my mind. Doesn't mean that I don't mean to call, but it means that I'm just very, very busy. And if I can get back to it and say, you know what, I have this, I didn't do it last month, but they reminded me with this email. Boom, let me get it. Then you have people that have, you know, a larger amount of stores where they have office time that they can sit back and say, hey, I've got these three guys that have said this three different times. I want to reach out right now. And, you know, maybe maybe it's the case that it's just a dedicated email and you get you get a response back, you know, like, hey, this is Paul Adamson. I am looking at this and I will get back to you within 48 hours, whatever the case is. Um so that you you have that redundancy regardless. If they're never gonna hit you up because they just don't find the time and they get the email, they can do that from home. They can do it when they have, you know, easy time in the office, when they get in there at 7 a.m. or they're staying late till nine. And then you have the guys that are, you know, uh, because you have certain dealers, RTO dealers that have the guys that are, you know, they're in the refurbishment department, right? So they might have, if they have 20, 30 stores, they might have somebody or one or two dedicated to just doing that and they see it. And if they have a phone number and that it's not their email that you're sending that to, they can call you directly. So that would be my solution to it. Um and I think the more avenues you have, the better it is. Now, you know, at the end of a year, and you know, you can say, hey, we're getting more emails and we're getting calls, or we're getting more calls and we're getting emails, and we want to, you know, we want to up the ante on one or the other to make it more efficient for the dealer. That's what I would go. But I would definitely try it both ways.

SPEAKER_00 59:15

Okay. No, that's a great point. And I'll I'll get that implemented very quickly because I love that, right? That direct feedback is so important. Yeah, it's it could be a game changer.

SPEAKER_02 59:24

Well, that's what we want to do. We want to make it, we want to make it good, Paul. I mean, I'm just saying, you know? I know. I mean, I want to get a kickback, Paul. I'm looking for an ice maker. I'm just saying.

SPEAKER_00 59:34

So paraphrase that. My wife's looking for an ice maker.

SPEAKER_02 59:38

Yeah, your wife is definitely looking for an ice maker, but my wife is definitely watch this and be like, You did you did you get the ice maker?

SPEAKER_00 59:45

That's the only thing that's gonna come out of it. She's like, ice maker?

SPEAKER_02 59:48

Um, I don't know anything you said but the ice maker.

Quick-Fire: What To Avoid And Double Down On

SPEAKER_01 59:53

So, real quick, because you know, coming into the end, I mean, we have these discussions and it's always about how do we get better, how do we know what we're getting into and is it good for the customer, is it good for us, is it good for the margins, right? We always want to carry something that's good for them, but also good for the dealer. It's got to make sense for us and for the community that we serve. And it sounds like you know, Clover's trying to check off a lot of those boxes and whether we do some things that are got feedback or get into something that has feedback. I think the idea of partnering with L2 is a very good idea because they are well known within their RTO space and they can serve us very, very well. So I think that's a great thing. I want to ask you some quick fire questions and I want to put you on the spot. Now, I'm not gonna throw in my wife needs an ice maker yet. But um, you know, if you were to say, and this is just an honest question, uh, what would you say, you know, is the biggest upside for using Clover right now?

SPEAKER_00 1:00:45

Quality products, right? So when you're when the dealers are gonna explain certified refurbished, they they will have a confidence that it's backed by a company that's been doing it for 30 years.

SPEAKER_01 1:00:54

Okay. Most misunderstood metric when it comes to having a certified refurbished product on your counter.

SPEAKER_00 1:01:03

Oh, the probably the total value prop for that product, right? So you are able to save money on your per your original purchase as a dealer. So you've de-risked yourself from an inventory position. You've got a great story to be able to tell the next generation of buyers, you know, so they're gonna be focused on uh the sustainability side, the overall narrative of that brand for your standard. You know, I'm gonna call it us Gen Xers or others that maybe are not as first, you know, driven by the sustainability equation. We like a good deal, but you're able to provide a good deal. So when you're thinking about checking the boxes, you know, this is a product that sits on your counter that is understands the reality of the market today, which is there's a lot of pricing pressure on people, right? You know, people are feeling the the the kind of the extremes of the cost of products in general. So you're helping them understand that this is a better valued product, it has the same quality, they can feel comfortable in the fact that the brand has anointed this company to provide this service, and at the end of the day, they're also helping to create a better world by buying a refurbished or remanufactured product.

SPEAKER_01 1:02:18

Okay. What is, in your opinion, one category of refurbished product that maybe somebody in the rent-to-owned industry should avoid?

SPEAKER_00 1:02:28

Oh, oh, that's interesting. Um, I would look at um things with large battery packs. So uh, you know, e-bikes, um, portable power stations, unless they're buying them directly from the reefer uh from the brand certified partner, um, only because uh batteries degrade at different rates and you can end up with a lot of challenges around that. Um so uncontrolled battery management is still a huge, you know, huge challenge in the space. Um the other part around that is meeting the requirements for shipping a uh a rechargeable battery these days is much more complicated. And so what you don't want to be is the receiver of a pro product that was shipped incorrectly.

SPEAKER_01 1:03:18

I can tell you right now, there's nothing like a lithium-ion battery fire. That thing is unbelievable. Yes. And last but not least, question that I want to ask Paul Adamson, the C R O of Clover, what is one category that you would say you should double down on?

SPEAKER_00 1:03:36

Uh as a dealer, um, I would probably focus pretty big on premium countertop appliance. That coffee space, there's a reason everybody's moving into it, and you could capitalize upon it. I would, in my my world, I would get uh lean into semi-automatic espresso machines over fully automatic. Less things that can go wrong, uh less complication for your consumer. Um, but you know, there's the Brevel product is amazing, other brands as well, and I think it would bring a lot of value to your consumers.

SPEAKER_01 1:04:12

Well, guys, we've tried to uh get get Paul to shook up a little bit, you know, knock Clover around a little bit. They seem to be doing all right. They think he's done his homework a little bit. I don't know what happened. You must be on the bad phone because you changed backgrounds real quick on me. I need to know what happened. You did it so fast. I don't even know what happened, but I want to do something I do appreciate you being on today. Paul, it's been great to have you on here. If somebody wanted to reach out to Clover and make that choice and see how you are, do they contact L2? They contact you. Can you give them a little bit of information for that so that they can uh find out where you guys are at and start utilizing it?

SPEAKER_00 1:04:43

Yep. So if they're gonna be uh purchasing product for the their their stores, it'll go through R2. Um if they just have general questions about you know refurb, refurbishment, remanufacturing, the standards, I'm more than happy for them to reach out to me or a member of my team. Um, you know, I don't know if I just need to rattle off my email address or if you'll post it at the end in the comments. We're gonna do both.

SPEAKER_01 1:05:06

So if you want to give us an email address, we'll post it down on the lower third. That way everybody gets to understand one way or the other. We know how to get a hold of you, but go ahead.

SPEAKER_00 1:05:14

Sure. So Paul.addamson, so a-d-a-m-s-o-n at cloveres.com and happy to address your questions. Love the engagement. And if you want to be uh I will call it a guinea pig for general feedback from the rent-to-owned space, would love to hear that as well. And what would work best for you for giving that feedback?

How To Buy And Get In Touch

SPEAKER_01 1:05:34

I tell you guys what, it looks like clovers.com because that's actually what I thought it was, and I got corrected, you know, and so it's uh Clover Environmental Services. But Paul.addamson at Clovers.com. Guys, I'll tell you as always, we do appreciate having Paul on here. I can tell you what, I've seen it. If you guys have an opportunity, make sure you stop by their booth and take a look at them. If not, give them a call. See if you can reach out on email and maybe they can send you a little bit of a lineup so that you can have an idea. Of what they do and how it can serve you. I'll tell you guys as always, we appreciate you being here. And Paul, make sure that you check us out on Facebook, Instagram, LinkedIn, YouTube where you're gonna see this. Paul, I want to tell you, I do appreciate taking your time. Let me kind of throw a couple jabs at you. And I'm gonna tell you guys as always, get your collections low to get your sales high. Have a great one.