Is Refurbished Tech The Big New Category In 2022?
Demand for refurbished smartphones is booming in Australia according to Sams Skontos the former head of TCL Mobile, now the shortage of components is tipped to create demand for more second-hand devices with some retailers now looking at how they can expand into the refurbished market.
The biggest problem is supply and the cost of refurbishing a product.
In an indication of the potential growth in refurbished tech goods Back Market, an online marketplace that sells refurbished iPhones and other electronic devices, this week raised funding that boosts its valuation to US$5.7 billion, leapfrogging what it was worth less than a year ago, according to the company and its investors.
Founded in 2014, Back Market fixes and resells electronic goods, including Apple and Samsung smartphones and tablets, MacBook, Dell and Microsoft laptops, Krups coffee makers and Dyson hair dryers.
The company, based in Paris, raised $510 million in its latest funding round. Leading the investment was Sprints Capital, a London-based investment firm that counts online payments company Revolut among its other technology-company holdings.
In the USA retail groups are discussing the establishment of new trade in trade up programs in an effort to create a flow of product and revenue from refurbished devices.
Devin Partida the Editor in Chief at Rehack.com has been tracking the growth in the trade in and refurbished market she claims that smaller businesses in the resale market are thriving, as consumers turn to older models of electronics or refurbished products. Some people are also choosing to have their damaged phones repaired instead of purchasing the latest model, especially when it comes to the iPhone.
In the USA where I am at the moment, Companies such as Apple, Best Buy, and Amazon run programs that allow customers to trade in their devices for store credit or pure cash.
Not only does this help the seller, but this makes devices more accessible to those on a budget, too claims observers.
A major US retailer told ChannelNews at CES that his Company is looking at the cost of selling refurbished devices as an ongoing category.
The ongoing global chip shortage has let to shortages of products with consumers moving to refurbished products instead of a new device.
among other issues like staff shortages, supply chain disruptions, and new variants of the COVID-19 virus. This affects the types of tech products holiday shoppers can buy for their loved ones.
‘Apple hasn’t made any mind-blowing changes between models in the last few years. Unless the tech giant introduces a major shift in the iPhone, users will continue purchasing refurbished or second-hand models’ claims Partida
She claims, ‘It’s better to collaborate with a reputable dealer when buying used items compared to breaking the bank on the newest item on the market’.
In Australia Aldi has sold out of refurbished iPhones in hours.
One shipment supplied by Tempo proved that consumers are prepared to invest in a cheap refurbished product especially if it is a product manufactured by a reputable brand.
For Australian retailers there are several options for customers looking to sell their old technology. However, the challenging part is finding the right option to give customers the best deal as supply and the obtaining of quality refurbished stock is an ongoing problem.
Major brands currently running trade in programs in the USA include:
Apple’s trade-in program accepts many devices, and devices from other companies are no exception. Additionally, if a customer brings in equipment that has no trade-in value, Apple will recycle it free of charge. It takes a few weeks to complete the trade-in process, but it can be much quicker if customers visit an Apple Store close to them.
Amazon accepts many different devices, from smart home doorbells to smartphones and beyond. Amazon will offer customers a trade-in value when they plug in basic information about the device’s specifications. Usually, after Amazon receives the unwanted item, it’s checked and the order is reviewed before customers receive payment in the form of an Amazon gift card.
Best Buy has an online trade-in estimator on its website, so there’s no guessing what items may be worth. Best Buy gift cards are given in exchange for unwanted or older devices. The turnaround time for the trade-in process is a bit longer compared to the options listed above, but Best Buy will recycle products that have no value.
“Another big benefit is that the recycling of CE products is good for the environment with a lot of old technology components now being recycled. House of Marley is just one Company who uses recycled materials to manufacture new products.