Korean electronics giant Samsung is looking to launch a program where it will sell refurbished used devices of its premium smartphones according to a report.
Korean electronics giant Samsung is looking to launch a program where it will sell refurbished used devices of its premium smartphones according to a report. Samsung, similar to Apple, in a bid to open up alternate revenue sources, will make the refurbished phones available “as early as next year,” according to a source, Reuters news agency reported. Other than the usual smartphone line-ups, the tech giant was looking at alternate ways to ‘sustain earnings momentum’. Samsung with an aim to keep more that 10% of operating margins, will refurbish high-end smartphones which were returned to the company by users from the US and Korean. These markets that the option of signing up for one-year upgrade programs.
Samsung seems to have taken a cue from Apple which has an extensive refurbishing program where it remanufactures the devices a few months after the introduction of the product. According to estimates made by Deloitte, the refurbished used smartphones have a strong market and may bring in above $17bn this year. According to Reuters, Galaxy S7, and Galaxy Note 7 have been favourites among users and can sell the maximum. It is not yet clear, to what extent the company will refurbish the devices, as claims made by refurbishers say that the company may add new parts which can be a gain of life for the phones. Samsung will have to sell the refurbished premium smartphones at less than premium prices.
It is possible that the sales of these models may eat up into the sales of new smartphones and if there are less new features added in each generation then the effect could be worse. Though it is possible that Samsung will mainly be targeting the emerging cost-conscious markets where less number of people can afford high-end phones. This effort may double-dip on revenue as Samsung already makes too many smartphones. But there is also a case, where Samsung can rival the lower-cost Chinese rivals which have a huge market in emerging economies. It is difficult to gauge the performance of the refurbished smartphones sale since Apple does not disclose their sales figures.