Every entrepreneur faces waste, whether it is inventory, time, or money lost in the shuffle of doing business. Rebel founder and CEO Emily Hosie built North America’s largest returns re-commerce platform by asking how she could turn that waste into profit. This was one of the shocking things I have learned—saying “no returns” is not profitable.
Emily’s company partners with retailers to reprocess and resell returned and overstocked items that would otherwise become waste. To date, Rebel has kept more than 25 million pounds of goods out of landfills each year while creating a new source of revenue for its partners. Returns aren’t just a cost of doing business; they can become your next source of profit.
On a recent episode of The Big Idea from Yahoo Finance, I sat down with Hosie to explore how she turned one of retail’s biggest headaches into a sustainable and scalable business. Her experience offers practical lessons for any founder who wants to turn setbacks and inefficiencies into growth.
Spot the opportunity in waste
When Hosie began, she noticed retailers had no efficient way to handle returns. Investors understood excess inventory, but few realized the massive cost of returns. In 2024, U.S. retailers processed $890 billion worth of returned merchandise. Hosie said that figure is expected to reach $1 trillion by the end of 2026.
Hosie explained that at first, no company wanted to admit its returns were being thrown away. Her breakthrough came when a large retailer on the brink of bankruptcy finally acknowledged the problem and asked if Rebel could help process its discarded inventory. That moment, she said, proved the model could work at scale.
For small business owners, the lesson is to look for inefficiency hiding in plain sight. Know your return rate, audit your return policy, and explore creative ways to resell or repurpose unsold inventory. You might list returned products in your website’s clearance section or move them through a warehouse sale. Waste is rarely just waste. It is often an overlooked resource waiting for someone to manage it better.
Educate and build trust
Creating a new category required educating three audiences: investors, retailers, and consumers. Investors needed to understand how returns differ from factory overstock. Retailers had to admit they needed a better solution. Consumers needed clarity on what “open box” means and why it offers value. Open-box items are products that were purchased and returned but never used.
Hosie built credibility by showing results and using early successes to bring others along. Once one partner trusted the platform, her team used that proof to win the next. When you are selling something new, proof of performance is your best marketing. Teaching your market what problem you solve and showing measurable results builds trust faster than any pitch.
Turn risk into resilience
Hosie launched Rebel in unusual conditions and kept moving. “It started in our basement,” she recalled. “We had transport trucks dropping pallets of returns on the sidewalk in downtown Toronto.”
The timing was far from ideal. Hosie was pregnant, and the pandemic lockdown had just started. “I think there’s never a right time,” she said. If an idea does not work, “then you’ll just go back and get another job.”
Her experience shows that flexibility matters more than timing. Founders who start before conditions are perfect learn faster, pivot sooner, and build resilience by necessity.
Build loyalty through returns
Hosie treated returns as a growth tool rather than a nuisance. “Over 50% of [customers] are discovering a brand for the first time,” she said, describing how open-box pricing introduces shoppers to labels they might not buy at full price.
She also found that shoppers who make a return often “buy triple the amount” during the visit. A strong return policy can be part of a healthy customer retention strategy. It keeps people engaged and builds goodwill long after the initial purchase.
Hosie’s story shows how rethinking waste can unlock new revenue, new customers, and a healthier business. The lesson is simple: Look where others see loss, educate the market with proof, make your move before conditions feel perfect, and use returns to build loyalty.
Elizabeth Gore
Source link