If you are looking to get into the business of reselling phones and want to know what to expect in terms of profit margins then you have come to the right place. However, it should be noted that there are some issues when it comes to forecasting because you are dealing with the secondhand market. Some resellers strive for higher margins than others but we have done our best to collect as much data as possible and give the most accurate average we can. Depending on the type of phone you can expect profit margins to be anywhere between 20% and 50%.
Phone Reseller Profit Margin Factors
A lot of the reason for the profit margins varying so much has to do with the model of phones that are being sold. Lower-end phones from less well-known brands are not the best option in terms of profit margins. Apple iPhones and Samsung Galaxy phones will fetch the highest margins in general.
There will also be a large market looking to purchase these premium phones on the secondary market for a more affordable price than brand-new ones.
How Much Do Repairs Affect Profit Margins
If you are concerned about phone repairs cutting into margins or being too big of a hassle, that is a very fair concern. A lot of phone resellers do not repair their phones and instead simply sell ones that don’t need repairs. Some resellers will perform easy and cheap repairs but expensive or difficult repairs are not that common in the business.
In short, if you are looking to get into the business of reselling smartphones but are worried about repair don’t sweat it. It is not a requirement to repair phones before selling them.
Conclusion
At the end of the day, it should be mentioned that profit margins are the only determining factor of success in this business. Being able to sell a good amount of volume is also important. You can go for maximum profit you can use sites like eBay or offer up.
The issue with this is that there is a lot less volume so even if you have healthy margins you won’t make that much. If you want greater volume with lower margins then a site like Flipsy is a good option. You won’t be able to achieve the same margins but you will be able to scale and likely end up making more money.