Last year, we featured a German start-up called Sparschwein, which encourages consumers to scavenge their homes for unused items to be sold through auction sites like eBay. The selling process is handled by Sparschwein agents, and Sparschwein deposits proceeds (minus a handling fee) directly into a seller's saving account, held at Deutsche Kreditbank.
So – how has Sparschwein done over the past year? They've increased their customers' wealth by over EUR 49 million, earning more than EUR 3 million for themselves and their agents. Recently, they've also added a new sales channel: television. Using MMS or an online form, customers can send pictures and descriptions of items for sale, which then appear on local tv networks.
Besides letting consumers sell their unused rollerblades, dvd players and antique tables, Sparschwein now also intermediates in life insurance cash-outs. By taking insurance policies to the highest bidder, Sparschwein claims that it can earn customers an extra 20% compared to what they would normally get from cashing out.
Sparschwein estimates that German consumers have over EUR 20 billion in unused goods stashed in their basements, attics and garages. Considering numbers are similar for most developed nations, there are plenty of opportunities for companies that will help overzealous consumers convert unused clutter to cash. For more examples of entrepreneurs feeding (off) online auctions, check out trendwatching.com's feeder businesses.
I am sorry but I failed to understando something in this idea. How Sparschwein makes money? It serves as yet another intermediarie (along with ebay) between the seller and the buyer?
Hi Alexandre -- Sparschwein charges a handling fee, and probably also gets a finder's fee for bringing Deutsche Kreditbank new customers. And yes, it's an extra intermediary. There are actually quite a few companies that help consumers sell stuff on eBay. Click on the 'feeder businesses' link above to see more examples. Hope that answers your question!
Hi,
the "sparschwein-idea" is pretty easy:
1. Our customers have more money, because they realise "dead assets". we earn money on the intermediary function. The revenue-sources and cost-structure there are very heterogenious and depens on the item or "asset-class" of "dead asset".
2. Sparschwein Customers earn more money, because we will offer startin Q3 a very aggressive saving account with high yield income. Potential revenue: Cross selling into customers consumer dreams (ref. point 3)
3. Sparschwein-Customers pay less fulfilling their dreams, because we will acchieve better shopping conditions for our customers. potential revenues: merchant commission.
So, basically, this is it. Please feel free to contact me!
Matthias
matthias.kroener@sparschwein.ag
How does sparschwein go about finding customers. Doe they have physical locations set-up that customers can come into?
Sparschwein AG communicates in all channels and establishes strategic cooperations. This means in detail:
- search engine sales in order to find customers that want to sell their life insurance or "closed funds construct" (a typical german tax incentiviced product)
- cooperation with IFAs (Independent financial advicers) with the same objective as above.
- cooperation with one of the largest retail groups in germany like karstadt quelle. here we have the so called quelle shops (approx. 4.000) offering their customers the service of sparschwein ag.
- karstadt quelle bank is going to cooperate and setting up a "high interest account" for sparschwein customers. this will be first communicated within the 125th anniv. in Q4 2006.
- media and public relation works very well and is very important. and we can, because, the service of sparschwein really helps the customers and delivers additional cash without any additional work and less complexitiy for the customer.
This is enough of our company´s secrets ;-)
Matthias