The Need
iPhones have always been expensive for Indians, thanks to the slabs of import duties and the other related costs. As of now, Apple is said to have a marginal influence over the Indian market with shares less than two percent. This is quintessentially due to the fact that we have a wider and a more voracious market for budget smartphones, in fact one report states that the average smartphone selling price in India is pegged at $135 and is expected to fall to $102 in 2018, economy of scale? Well, Maybe. We already have a slew of other handset makers offering premium phones and Apple wants to bring first time iPhone users on board, something that the iPhone SE was expected to do but the rather hefty price tag made it a bummer.
The Problem
Government has always kept a tab on import of used things, it has from long imposed a heavy 180% duties on importing a used car. While this might sound outrageous at the outset, we also need to gauge on the degree of adversity the local manufacturing market will face. We Indians are especially sensitive when it comes to e-waste, the reason is that India has been the dumping ground for nearly 90% of the world’s e-waste, most of which is disposed off unscientifically. In spite of being refurbished and inspected thoroughly, the iPhones would already be in their midlife and in all likelihood the new owner might dispose the device after using it for around a year, which would result in faster e-waste generation. The local manufacturers have been worrying that cheaper refurbished iPhones would eat into their share of sales and this is something that will ensure a strong opposition for Apple.
The Workaround
The best bet for Apple would be to reduce the price of base phones like the iPhone SE, like it did today in the US. Alternatively, it can also introduce aggressive exchange schemes that would attract buyers to cave in for an iPhone, the current exchange offers are passive, in the sense the quote for the used smartphone is way lower than the used market price. If it interests you, this document will walk you through the typical cycle a used electronics goes through once in United States, before it is refurbished and exported. It shouldn’t be difficult for Apple to introduce a recycling scheme which would allow users to trade their unusable iPhone for a store credit. Remember the super cool Liam Robot Apple showcased recently, well that could be the answer for this problem. All said and done Apple should divert its focus from used handsets and instead should work towards other initiatives to being on board new customers, which also includes commissioning the manufacturing at the Indian Foxconn unit in the future.
