Apple released four new iPhone models in 2020. Historically, the annual iPhone release happens in late September, but given the impact of COVID-19 on the supply chain in 2020, new models hit the primary market in two waves, the first on October 23rd. But what happened next, we didn’t expect.
The iPhone 12 and 12 Pro began to flow into the secondary market, primarily via customer returns, by late November. While the timing and volume was in line with prior years, the pricing certainly was not.
With its first sales into the secondary market, both the iPhone 12 and iPhone 12 Pro fetched prices above MSRP. Usually, B2B bulk transactions don’t approach retail prices, but in the case of the iPhone 12, the secondary market prices actually surpassed retail.
Typically, one month post-release the latest generation iPhone fetches 82-89% of the original retail price (for functional devices in good cosmetic condition); this time, the iPhone 12 and 12 Pro were selling for 109% and 107%, respectively.
Over the past eight weeks, 14% of auctions containing iPhone 12, 12 Pro, 12 Pro Max, or 12 mini have sold for above MSRP while 37% of auctions ended at 95% of MSRP or higher.
A majority of these devices will end up outside of the US. The phones are sold into geographies with higher MSRPs from Apple like Asia, South America, and the Middle East, as well as areas in which supply from the OEM cannot keep up with demand.
A portion of these devices will also stay domestic. In addition to physical electronic/cell phone resale stores, these devices will get sold on ecommerce platforms like eBay. In many cases the marketplace may run promotions or offer incentives to sellers with this inventory so that their site can become a destination for buyers looking for the latest tech. Sales tax arbitrage also comes into play given the high price of these new models.
Currently, in mid-January, the iPhone 12 has settled into an ASP equating to 85% of MSRP. While the historical average of three months post-release ranges from 76%-82%, the iPhone 12 is still outperforming prior generations, but the gap is beginning to close.
Large carriers are moving more devices through B2B channels for resale on the secondary market versus repairing and selling B2C. If you want to learn more about secondary market trends and how large carriers, OEMs, and buy-back companies are increasing the life cycle and pricing of phones via B-Stock’s B2B marketplace platform, please get in touch below.Request Demo