According to Persistence Market Research, the global secondhand cell phone market was estimated at $50.5 billion in 2022 and grew to $55.7 billion in 2023. The compound annual growth rate (CAGR) is also impressive, and is expected to grow by 11-12% by 2030. These numbers make the used and refurbished smartphone market an attractive one to start a business in. Today, we will help you create a detailed business plan for your secondhand cell phone business.
Research Market Conditions and Trends
As the market grows consistently, there are multiple trends that develop over time. Researching these trends and considering them when creating the workflow is crucial. Here are some market trends to keep in mind:
The growing popularity of online platforms for used and refurbished smartphones, driven by the overall growth of e-commerce websites, is expected to boost market demand. The online format suits various businesses, including retailers and wholesalers. Additionally, you can offer online trade-in services, attracting more customers to your business.
Providing certificates showing the quality of the device is becoming more common. These reports help increase the resale value of phones and build trust between you and your customers.
Sustainability trends influence the second-hand phone market, leading to an increased demand for used devices. People tend to buy used smartphones for environmental reasons, supporting a circular economy. Therefore, it is important to share your sustainability values with your target audience and implement eco-friendly practices in your workflow.
Robotic solutions are driving the market. Since manual testing and sorting proved inconsistent and inefficient, companies are finding other options to process devices. Now, only robots like Reeva from NSYS Group can perform complete device testing, sorting, pricing, and clearing, completely eliminating human errors.
Regional differences mean that business will vary from country to country. The largest and most competitive market is North America: its market share in 2022 was 25.8%, according to Persistence Market Research. Demand for used phones is growing primarily in Asian markets, such as China, India, and Indonesia.
Create the Business Model
Considering market trends, choose the services your business will offer. Answering the following questions can help you decide:
In which country or countries will you be working?
Will you resell devices to end users or other businesses?
Will you work online or offline? Or both?
Will you provide buyback and exchange services?
Will you provide repair services?
Depending on your answers, create a business plan, considering all the profit channels you will have. Keep in mind that the more services you offer, the more customer needs you will meet. Also, choose a business name that represents what your company does. The name should be relatively rare: check if similar businesses have the same name. If you have a physical store, you can add the name of your city or region.
Build your inventory
First, focus on the most profitable phone models. However, customer demand is evolving; therefore, market analysis must be a constant activity. Read our roundup to make sure you have the best models in your stock. We’ve compiled the top 10 iPhone and Android models there.
Various benefits can be enjoyed by acquiring updated 2024 mobile phone number data mobile phone number data from a website. First, businesses can scale quickly and reach a diverse clientele, thus improving their chances of generating leads and conversions. A well-converted phone list can unify the sales process, allowing employees to efficiently engage with prospects.
What Phones Should You Not Buy?
In addition to choosing which phones to buy, remember the types of devices you should not purchase. For example, outdated and vintage iPhones, locked phones, or those with financial debts. These devices will be difficult or impossible to resell, leading to increased business expenses. To avoid purchasing such phones, perform IMEI checks with software like NSYS Diagnostics. This will help you detect the status of the device and its overall functional condition.
Find Suppliers
Finding a supplier may seem appealing at first. Sure, buying all your phones from one place is easy to manage. However, it puts you at risk and makes you dependent on the exact company. To win the competition, find several suppliers who will have to keep prices reasonable. Even if you depend on the supplier, it is essential to check the batches of phones yourself. This will ensure the quality of your stock and avoid other expenses related to device repair. We have analyzed our customers’ statistics to share the data on the most common phone defects. Check the devices thoroughly to make sure they do not have these problems.
Test the Devices
Device diagnostics is crucial for any business that deals with used phones. Performing tests manually is an outdated approach: it is time-consuming, prone to human error and fraud, and can appear unreliable to customers. When starting a cell phone business, the best option is to use testing software like NSYS Diagnostics . In addition to fast, efficient, and transparent testing, the solution provides a certificate for each tested device. You can share the report with your client to prove the quality of the device.
Improve Ranking
The next step in evaluating a phone is grading. Since grading systems can differ from vendor to vendor, there can be some misconceptions about the actual condition of phones. If you get the wrong grade, you could overpay for a “B Grade” phone with a cracked screen and lose money. If you buy a batch with mismatched grades, you’ll have to spend money repairing phones and offering a lower selling price to customers. To avoid such issues, some companies determine grades by visual inspection, while others use checklists and manuals to measure the size and number of scratches. Instead, use an automated solution to grade phones accurately and quickly. NSYS Autograding eliminates human error and provides consistent results. You can assess cosmetic conditions automatically through an AI-powered tool, and all you need to start grading is a mobile phone with the app installed.
Analyze your Sales Data
Every business has to manage its inventory, whether in spreadsheets or with specialized software. Otherwise, there will be no understanding b2c fax of how items move through the warehouse, where they are stored, and when and to whom they are sold. Implementing a warehouse management system will help you create your own business strategy for:
Invest your cash profitably.
Detect problems in the first steps.
Reduce the rate of lost sales.
Reduce theft and losses in your warehouse or store.
With the inventory management system , you will finally be able to track the parameters that are important to your business and improve your decision making.
Implement Buyback and Exchange Solutions
While wholesalers have been impacted by the decline in trade-ins from carriers and retailers, trade-in companies that buy directly from customers are maintaining business growth and taking advantage of more market opportunities. If you decide to start a buyback or trade-in program, we recommend implementing software solutions to protect you from endless checklists, online spreadsheets, and staff errors. For example, NSYS Buyback automates trade-in and buyback services for a cell phone business. The solution helps increase profits from BB/TI deals, eliminate unnecessary costs, and increase customer loyalty. It has numerous features to simplify the process:
Customizable tests to accurately identify device value.
Estimation of preliminary and final exchange values based on market prices.
Integrated and simple device diagnostic process.
Integration of any existing device list.
One More Tip
As you can see from the tips mentioned above, running a used cell phone business is a complex process that includes multiple steps and requires careful preparation. Instead of choosing multiple software for testing, pricing, etc., implement an ecosystem iran phone number data material of software solutions. This will ensure simple scalability and interconnection of services. NSYS All-in-One is a perfect ecosystem for your used device business! It will help you automate your workflow and improve your decision making with advanced analytics. Click the link below to try NSYS All-in-One!
