Market Trends of China Refurbished Smartphone Industry
This section covers the major market trends shaping the China Refurbished Smartphone Market according to our research experts:
Increased Adoption Through E-Commerce Channels
- The professional way of refurbishing where an old phone goes, several quality and performance check-ups means that the users, in most cases, are getting a quality device or at least what they are promised. The problem is that the refurbished industry is currently handled largely by offline stores, which tend to offer lower quality phones at higher prices and low reliability. This gives a bad name to refurbishing. However, with changing times and the rise of e-commerce and professional refurbishing, it is anticipated that the refurbished smartphone market will grow additionally with the involvement of major companies like Amazon, Cashify, and others that are dedicated to refurbishing and producing quality products will further strengthen the market and will bring the much-needed confidence in users for refurbished smartphones.
- The telecom operators are best positioned to play in the e-commerce economy. These companies are uniquely capable of generating both the used-phone supply and demand. With millions of available smartphones sitting idle in people's drawers and millions of 3G and 4G phones that are expected to be traded in as part of the 5G technology migration, operators can capitalize on this expanding supply pool to drive new subscriber growth and consumer affordability. To seize this opportunity, these companies require a well-defined re-commerce strategy that boosts and leverages a device's residual value and market price for a used smartphone at any point after its launch to potentially drive significant benefits in the business.
- Refurbished products have their area on Amazon, the regions, and the online store. Customers can trade their old smartphones for a discount on a new device at Amazon. The company inspects them and makes any necessary repairs to make them appear and work like new. After that, these devices are resold in the refurbished market. They're even covered by a limited guarantee from the merchant or manufacturer.
- Concerns about supply chains and chip shortages prop propel the refurbishing industry forward. To address this demand, businesses are turning to refurbished electronics suppliers, expected to drive the refurbished electronics market, particularly Smartphones.
- There's also a category called "manufacturer reconditioned," which distinguishes itself from fixes performed by local repair companies. This means that the manufacturer, like original equipment makers, repairs the phone with original components, confirms its functionality, and renews it in a "like new" state. This is what most people look for, and customers prefer refurbished smartphones.
Understand The Key Trends Shaping This Market
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Impact of 5G on Refurbished Smartphones
- In the current market, 5G technology is one of the most heavily invested technologies by several major corporations worldwide. 5G connectivity is also expanding the range of applications to enhance numerous sectors' efficiency. Consumers increasingly demand digital involvement and personalized experiences as technology in cellphones becomes more prevalent. Furthermore, the increased willingness of government bodies to adopt and commercialize 5G technology is expected to benefit the industry under study. The 5G device ecosystem is expanding in terms of the many device pricing tiers and operating systems available on the market.
- According to GSMA's Mobile Economy China 2021, China will be adding around 340 million smartphone connections by 2025, with adoption rising to 9 in 10 connections with 1.5 billion in Mainland China, 12.3 million in Hong Kong, 1.9 million in Macao, and 25.7 million in Taiwan. The consumer willingness for 5G adoption is high in China. This is evident in mainland China's growing share of 5G device sales. According to GSMA's Mobile Economy 2021, 163 million 5G smartphones were sold in 2020, accounting for nearly 53% of total smartphone shipments.
- Additionally, the brand new, top-of-the-line flagship smartphones are not always an option for buyers on a budget. The hefty price tags and underwhelming advancements between the models have seen multiple consumers turning their back on the conventional smartphone upgrade cycle.
- Although 5G smartphones will take a while to hit the refurbished segment, trade-ups are starting to impact the market landscape. For now, the time has been limited for the refurbished market for 5G phones itself to properly get going. Also, any large uptake of new technology such as 5G is anticipated to drive increased trade-in volumes and, consequently, more products entering the secondary market.
- A major impact of 5G technology on the refurbished industry can be huge dumps of older technology 3G and 4G compatible smartphones. As more and more consumers move to 5G technology with respect to better connectivity and internet speed, they will discard their older 3G and 4G smartphones. This can be problematic for refurbishers to sell obsolete technology phones, especially when telecom industries shut down their 2G and 3G spectrums.
