FARO sources excess inventory and consumer returns from global fashion brands, restores items in its own facilities (industrial laundries and steam tunnels), and sells them through off-price physical stores in South Africa. Its inventory mix is roughly 40% reconditioned returns and 60% overstock, sourced via partnerships with brands including ASOS, Boohoo, G‑Star, Jack & Jones and Levi’s. The company targets a fixed margin of 45% after all costs and says it reinvests any excess margin into better pricing for customers. FARO launched a 2023 pop-up that generated $100,000 in its first month, now operates four stores, reached about $2M in annual revenue with those four outlets and reported 20x revenue growth last year; it aims to grow fivefold this year. It intentionally focuses on offline retail given the one-off nature and high cost of digitizing off-price inventory, while developing AI-powered buy models and personalized shopping tools to streamline sourcing and customer notifications. The startup plans to scale aggressively—targeting 1,000 stores over the next decade—and explore expansion into other emerging markets with localized price profiles.

Total raised

$6M

Funding rounds

1

Latest round

Seed

Latest activity

Jan 2025