Customers, above all
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At the end of the day, customer enjoys the final benefits of the second-hand business, though channel also profit. Most of the large format retailers (LFRs) run such schemes just for the convenience of customers. They give the best market value to the old handsets. This apart, some extra benefits are also given to the customers.
"Customer convenience is the key objective behind handset exchange service"
"Customer convenience is the key objective behind handset exchange service. Existing mobile customers want to upgrade or buy a new handset, and at the same time, they look for a reliable and hassle-free way of getting some value from their existing mobile," said Rajiv Agarwal, CEO and Director, The Mobile Store, Mumbai.
In a bid to beat their competitors, channel people often exchange a useless phone as well. But they make sure that it helps them earn good money in resale after repairing it. "We have a provision of repairing handsets on our own. We can figure out the errors that can be rectified and which can’t be rectified. There are times when customer visits us with a phone in which the keypad is not working properly or the screen is full of scratches. The customer doesn’t prefer using such a handset. He intends to exchange it, and look for a prospective buyer for it among their acquaintances. We offer them best possible pricing for the same, and also help him in selecting a new model as per their requirements," revealed Madhusudan Stija, Proprietor, Spice Communications, Gurgaon.
The handsets
The telecom market possesses unlimited potential and scope for all kinds of cell phones. "All branded mobiles across the price spectrum are being exchanged. There is no such major bracket that we have noticed. But yes, newer models entering the market do excite mobile-savvy customers to take a walk to the nearest store to check out its features. This in turn encourages the purchase of the handset," he added.
"The trend of upgrading old handsets rather than discarding them is rapidly increasing"
Mohamed seconded his thought. "Normally, a customer exchanges his mobile only when he comes to buy another. Most of the phones we are receiving off late for exchange would be of basic models, as people are going for high-end mobiles. If a handset is less than a year old, then we offer a good depreciation value. If it were older than that, then we buy it at 70 percent less than the original rate," he pointed out.
The channel on a better profit margin, reload the exchanged old handsets. Some partners sell them at their own outlets, while others, fearing that it might hurt their brand image, pass it to other channels selling old handsets.
"We do not stock these handsets directly. There are about 10 agents connected to the gray market who refurbish and re-sell them in Bangalore. We usually contact them and they deal with the exchange. This is unlike LFRs, who stock and sell handsets through their partners,’ said Neelkamal T Budhrani, Proprietor, Waves Telecom, Bangalore.
Repairing of old handsets is also in demand. Channels, who have repairing center, buy second-hand phones to take out the useful parts to use it in repairing another.
"These second-hand phones are in-demand for repairing handsets as well. They buy old phones and take out the original spare parts to use in repairing the faulty handsets, without investing much into it," told Manoj.