The furniture industry is in every way an environmental disaster. It consumes massive amounts of natural resources to produce, more particularly wood, where it is the third user after construction and paper. In addition to natural resources, the furniture industry uses a boatload of potentially harmful plastics, resins and chemicals in production.
It also releases a lot of CO2 manufacturing and shipping. For example, the Furniture Industry Research Association (FIRA) found that the carbon footprint of a typical sofa was 90 kilograms, the amount produced by a Boeing 737 or 747 in one hour of flight time.
Then there is the waste it produces. Besides manufacturing waste, old furniture is a major contributor to municipal waste management systems. According to the latest EPA estimates, some 12 million tons of furniture waste was generated in 2018, with the lion’s share going to landfills and almost none being recycled.
Unlike other consumable items, like clothes that can slip into a barely-noticed closet or drawer, buying a new piece of furniture usually involves getting rid of an old one.
In 2018, when 12 million tons of furniture waste was produced, Americans spent some $128 billion to buy new furniture. In 2021, they spent $180 billion, an increase of 40%. If furniture waste was bad then, it’s worse now.
Given these factors, particularly the boom in furniture purchases over the past year, there is a large circular market opportunity for used furniture, estimated to be worth $16.6 billion by 2025. But its potential is hampered by issues of moving furniture from one house to another. The fashion resale market, estimated to be worth $47 billion by 2025, has no such shipping constraints.
To date, the used furniture market has been limited to local thrift stores and primarily local transactions facilitated by online sites like Craigslist and Facebook Marketplace. Other players, such as Chairish and 1stDibs, have focused on the luxury and design market.
Kaiyo e-commerce bridges the gap by offering popular brands such as West Elm, CB2, Ethan Allen, Crate & Barrel, RH, Design Within Reach, Room & Board, Drexel Heritage, Herman Miller and more, with premium pickup and delivery. Efficiency.
Online Furniture Swap Dating
What started as a furniture rental service in 2014 was relaunched in 2019 as an online furniture resale business after founder Alpay Koralturk saw the writing on the wall. He came to it from the finance side, having worked as a business analyst at JP Morgan and in the finance team at Martha Stewart Omnimedia and Moda Operandi.
“It all started with a personal need,” Koralturk told me. “After my wife and I got married, we were willing to buy used pieces to furnish our home because we care deeply about sustainability and the environment. Living in New York, we thought it would be easy to find great second-hand furniture. What I thought was a piece of cake turned into a difficult and frustrating experience. We ended up buying everything new.
His personal experience engaged his entrepreneurial spirit and he found a great untapped opportunity inspired by the used car market.
“Cars and furniture are very comparable products. After homes, these are the second and third most important purchases people make,” he continues. “These are highly depreciating assets and they both have comparable lifespans. But the used car industry is huge because of how many times people keep doing transactions with the same car. However, only a tiny part of the furniture is resold. And this is a category where people pay to throw away unwanted items. It’s a weird imbalance.
Recognizing the possibilities, Koralturk knew there was a ready market for gently used furniture, especially among urban nomads who pick up sticks and move year after year. The market potential was further boosted by the greatly reduced prices of used furniture compared to new furniture and the sustainability angle.
Solution for logistics
But first, he had to work out the logistics so people could tap into some of the equity in their used furniture and easily move unwanted furniture out of the house. This was addressed by offering sellers a free scheduled pickup service at their convenience after registering on the site and submitting photos.
Upon acceptance, Kaiyo’s pick-up team arrives as scheduled and performs a final on-site inspection. They then make an instant offer for the piece of furniture. If the seller agrees, the deal closes or the seller can wait for a sale to close and split the revenue based on the final sale price.
“The goal was to make it as simple as possible so people didn’t have to throw away their piece or beg their friends and family to take it away,” he says.
Once Kaiyo takes possession of a room, it is professionally cleaned, then photographed with the same care given to new furniture and posted on the Kaiyo website.
When purchased, furniture is delivered quickly, within two to three days compared to the many weeks or even months it takes for new furniture. A modest delivery fee between $19 and $39 is charged for premium home delivery.
Currently, Kaiyo offers delivery in the New York, Philadelphia, Baltimore and Washington, D.C. metro areas, but with a new $36 million Series B funding round, led by Edison Partners, it will expand service to Los Angeles. in a few months, followed by San Francisco and other parts of California.
“This is the next chapter in our evolution. This will help us bring our great service to more and more people and achieve our vision of making beautiful homes accessible and convenient for everyone. And it will help save our planet,” he says, adding that the company has made a habit of planting a tree for every order placed. But to celebrate this Earth Month, capped by Earth Day on April 22, they will plant two trees.
“We want more people to participate in the circular economy of furniture and we are opening a new category in the market in which everyone can participate”, concludes Koralturk.