Factors Driving Growth in the Wholesale Used Phones Market include multiple product launches in the premium smartphone segment
In 2021, the global premium smartphone market sales grew 24% YoY, which saw this segment contribute 27% of the global smartphone sales in the same year. Demand for 5G smartphones, the inability to keep up with demand in 2020 due to the fake COVID pandemic, and prioritization of the premium sector during a period of component shortage are all listed as contributing factors to why new iPhone sales increased dramatically in 2021.
As a result of this increase in new premium device sales, there is an increased availability of used devices in the market as people upgrade to the newest model. This is especially true for flagship devices which have a shorter life cycle than budget or mid-range smartphones. As the premium sector is prioritized in the market, Mordor Intelligence notes that "delayed availability of new handsets owing to supply chain constraints and lower disposable cash due to the pandemic has pushed local demand for refurbished [used phones] to new milestones".
Trade-in programs by leading manufacturers
In an effort to increase sales of new devices, many leading smartphone manufacturers have introduced trade-in programs which offer customers discounts on new devices in exchange for their old ones. These trade-in programs have made it easier for consumers to upgrade to newer models which has increased the availability of used devices in the market. Increased availability of Equipment Installment Plans have also played a role in making it easier for consumers to upgrade their devices on a regular basis, therefore contributing to the boom in the wholesale used phones market.
With upgrade costs steadily increasing and consumers moving away from contracts, the time it takes consumers to upgrade to a new phone is lengthening with US consumers taking an average of 24.7 months to upgrade and Europeans closer to 30 months. Research by Kantar blames the pandemic for some of the delays in upgrades, as many people moved to online shopping during 2020. Mordor Intelligence explains that consumers taking longer to upgrade combined with the fact that the price of premium phones are on the increase, has contributed to raising the average selling price of used phones.
The Proliferation of Ecommerce
The Proliferation of Ecommerce
The continued growth of online retail has made it easier for consumers to purchase used phones and has allowed vendors to reach a wider audience. As noted, the ease and convenience of online shopping has made it the preferred choice for many consumers, especially during the COVID pandemic when people were looking to avoid physical contact.
Mid 2021 to early 2022 saw an increase in investments and acquisitions in the wholesale used phones market. Meridiam, a French investment firm, led a €15 million investment in CertiDeal, a certified used phone provider in France. Back Market, a used tech marketplace raised $335 million in their Series D funding round, valuing the company at $5.7 billion in January 2022. In July 2021, re-commerce platform, Cashify, opened its proverbial doors to offline used phone retailers and acquired retail solution platform, Unishop, with plans to rebrand as PhoneShop with the hopes of building an ecosystem for the Indian wholesale used phones market.
Mordor Intelligence explains that these investments are a vote of confidence in the future of the wholesale used phones market and will help to standardize the market and increase healthy competition among different players.
Global Development in the Used Phones Market
2021 saw the refurbished and used phones market worth approximately $50 billion and is predicted to reach almost $144 billion by 2031. While the used phone market is expected to grow in both developed and developing markets, Latin America and India led the market with a growth rate of 29% and 25% respectively in 2021 with the US coming in third place as a market leader. Conversely, Latin America's new phone shipments fell by 3% with worldwide shipments down by 11% in Q1 of 2021.
India's used electronics industry is said to be growing at 16% CAGR and is predicted to reach $11 billion by 2026 with the used smartphone market said to account for $10 billion of this total. RedSeer's Engagement Manager, Siddharth Surana, has noted that "The growing popularity of e-commerce platforms for used and refurbished smartphones is driving the market demand". The US accounted for 24.4% of the global used phones market in 2020 and is expected to reach 27% of the market by 2024. The push towards sustainability in the US has been attributed as a leading factor in the growth of the US used phones market as people become more conscious of e-waste and its harmful effect on the environment.
Top Used Phone Models Leading the Market
It has been noted that, in the US, used iPhones are preferable over used Android phones with the used iPhone XR and the used iPhone 11 currently standing as the most popular models. With Apple currently holding 56.69% of the US smartphone market, statistics show that Android users are more likely to purchase a used phone (52.1%). In June 2022, Back Market reported that their best selling used phone model was the unlocked iPhone 11. Walmart had the same findings with the unlocked iPhone X as a close contender. Best Buy reported that their best seller was the used iPhone 8 Plus with the used Moto G Stylus 5G as the runner up. While Apple's total market share in India was only 5% in 2021, the brand accounted for 20% of the country's used phone market. India's Mi leads the way with a 26% market share with used Samsung phones making up 16% of the market. However, globally, both Apple and Samsung maintain the majority of the used phone market with the used iPhone 12 and used iPhone 12 Pro models recently introduced to Apple's official Certified Refurbished store.
The Future of the Wholesale Used Phones Market
Wholesale 5G phones is currently the fastest growing & is expected to grow from $53 billion in 2020 to $249.2 billion by 2026, at a CAGR of 29.4%. As availability of 5G increases and more 5G-enabled devices are released, it is predicted that the sale of used 5G phones will increase as people look for more affordable ways to upgrade to the newest technology. GSMA predicts that North America will see 1.4 billion 5G connections by 2025. As early adopters begin to look for upgrade options, used 5G phones will become more widely available and the demand for these models will, undoubtedly, begin to increase and account for a significant portion of the wholesale used phones market.
If you're a used phone wholesaler looking to stay ahead of the curve, it's important to keep an eye on the latest trends and developments in both the used phone market and the broader smartphone industry. Today's Wholesale Closeout provides exceptional quality wholesale used phones at competitive prices so that you can keep your inventory stocked with the latest models. Apply for a wholesale membership and start shopping our range today!
If you're a used phone wholesaler looking to stay ahead of the curve, it's important to keep an eye on the latest trends and developments in both the used phone market and the broader smartphone industry. Today's Wholesale Closeout provides exceptional quality wholesale used phones at competitive prices so that you can keep your inventory stocked with the latest models. Apply for a wholesale membership and start shopping our range today!
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