Second-hand cell phones, a market that invoices more than US$100 million

Whether for its price, for curbing the environmental impact or for accessing new technologies, the second hand cell phone market and especially the segment of refurbished smartphones has been arousing more and more interest among consumers.

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According to figures from the Persistence Market Research firm, in Latin America the size of the refurbished (reconditioned) market amounts to US$2.9 billion. When segmenting by country, Colombia appears in fourth position with a market valuation of US$103 million, after Brazil, Mexico and Argentina.

Regarding the shipments of this equipment, the consultant points out that so far this year the region has received 10.5 million refurbished cell phones. In the case of Colombia, 373,000 units have arrivedwhile in countries like Mexico and Argentina the figures amount to about 3.5 million and 1.6 million, respectively.

For its part, data from the firm Statista suggest that the purchase of second-hand products has become a “trend that has come to stay”. So much so, that in 2020 sales of used and reconditioned phones amounted to more than 225.5 million units globally, that is, 11.2% more than in 2019. “He expects that in 2024 the threshold of 350 million units sold will be exceeded”projects the market research firm.

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For Jorge Palacio, president of Clevercel, a platform focused on the sale of second-hand cell phones, this market takes on more prominence in consumer decision-making, “both for the issue of prices and for the impact on the environment.”

“Although the percentage of second-hand cell phones out of the total number of cell phones sold is low (we are talking about approximately 4% in the local market), this participation is expected to grow at rates close to double digits in the coming years,” comments Palace.

Likewise, the executive comments that despite the distrust that exists around the sale of second-hand cell phones, in the last three years the platform has sold 120,000 cell phones in the countries where it is present (Colombia, Mexico and Peru). For this year, the bet is to exceed the goal of 100,000 devices.

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“The great barrier is the distrust of the user and to the extent that there are players who arrive with a promise of value regarding quality, guarantee, legality, price and portfolio variety, that trust allows the market to develop”highlights Palace.

Among the equipment most sought after by consumers, Palacio stands out “that in the secondary market the iPhone brand represents almost 50% of sales worldwide. Devices like the iPhone 11 and 12 Pro Max have been in high demand, followed by Samsung devices like the Galaxy S22. Another of the brands most sought after by consumers is Xiaomi”it states.

But if you are one of those consumers who want to delve deeper into the subject or are interested in buying a second-hand cell phone or a reconditioned one, know that there are differences, which although they are not obvious, are major factors that can influence the purchase decision.

Sebastián Jiménez, general director and founder of Refurbi, a Colombian company specializing in the refurbishment of devices, explains that while a second-hand cell phone is one that does not undergo any type of modification and is only transferred from one buyer to another, refurbished equipment, For their part, they do go through processes of changing defective parts and even changing their batteries.

“These devices must go through an inspection process, tests are carried out to find out which parts must be replaced. It is important that these parts are replaced by the original ones. In our case, we put the batteries, which are Refurby brand, and which are manufactured in China with the same capacity as the original batteries, all with the purpose that the device remains in the same conditions and can be reintroduced. These cell phones have a useful life of two to three years.”Jimenez points out.

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Likewise, the director of Refurbi comments that this market has been gaining more consumers, which is why they already have a reconditioning factory in Funza, Cundinamarca, and work hand in hand with large marketplaces such as Éxito, Mercado Libre and Linio, among others. “Accessing high-end equipment becomes more and more expensive. That is why the reconditioned market is a great alternative. We have been operating for four years and our billing is increasing. We hope to sell more than 30,000 reconditioned units in the country this year.”

Cell phone.

iStock

When buying this equipment, the Woden company, focused on circular economy models in the telecommunications sector, advises verifying five key points such as the guarantee granted, battery capacity, storage capacity, validating the status cosmetic (how the equipment looks) and that it does not present bumps or scratches. And finally, check out the complementary accessories.

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Analytics consultancy Counterpoint notes that the global smartphone market declined 14% yoy and 7% qoq, registering 280.2 million unit shipments in the first quarter of 2023.

“Samsung replaced Apple as the top smartphone player in Q1 2023, buoyed by its mid-tier A-series and recently launched S23 series. Apple’s year-over-year decline in shipments was the smallest among the top five brands. Consequently, it registered its highest participation in the first quarter of 21% ”, details the firm on its official website.

JOHANA LORDUY
Portfolio Journalist