Making Money with Second-Hand Phones

As I've mentioned before, the average profit margin on second-hand phones is about $500. However, what's often overlooked is that the better the condition, the lower the profit — recovery costs are higher, and the selling ceiling is capped since they can't be priced above new phones. The worse the condition, the higher the margin. Most units of poor quality are disassembled and then flow into Pinduoduo, eventually returning to lower-tier markets. For example, parts are stripped out and sold as "new" components to offline repair shops, which also generates high profits.

This is precisely the foundation behind Pinduoduo's "ten-billion subsidy" program, where prices are kept low but authenticity is guaranteed rather than condition.

The New World of Second-Hand Phones: iPhones Dominate, and Lower Quality Yields Higher Profits | TMTPost Focus

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