iPhone X traders see low resale demand in Hong Kong
Device’s simultaneous availability at local phone stores said to affect margin
It marks a dip for the once-lucrative resale market, or the grey market, in which traders used to net many thousands of dollars per sale around the launches of new phone models.
Outside the three-storey Apple store in Causeway Bay, a trader surnamed Cheung said he would be happy if he could earn about HK$2,000 from reselling one 256GB model.
But Cheung, 40, said he felt uncertain about the market as the queue outside the store had disappeared by about 8.30am.
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“I couldn’t make an offer to potential clients because I wasn’t sure about the right price,” Cheung said. He had prepared about HK$200,000 to buy new smartphones and bought two at their original prices soon after the store opened its doors.
Hong Kong’s grey market for iPhones has been shrinking since 2013, when the fifth generation of iPhone launched simultaneously in the city and on the mainland. Subsequent models have done the same.
Between 2007 and 2013, mainland customers who couldn’t wait were the major source of high profits for the Hong Kong resellers, who would flog the phones north of the border.
Retail prices for the iPhone X are HK$8,688 (US$1,113) and HK$9,888 (US$1,267) for the 64GB and 256GB models. The latter is the highest unit price in Apple’s history.
Cheung believed the device’s simultaneous availability at phone stores was one of the factors affecting resale margins.
A young girl approached Cheung with an iPhone X of 256GB she bought from one of the phone stores and offered it to him for HK$20,000. Cheung replied wryly: “I have one from that [Apple] store. Would you take it for HK$15,000?”
Some resale stores in Mong Kok stopped receiving offers from traders last night
Cheung said he heard that “some resale stores in Mong Kok stopped receiving offers from traders last night”. The latest profit margin he had heard of was “merely HK$1,600”.
In contrast, a 30-year-old man surnamed Chan hoping to resell his 256GB iPhone X was more hopeful.
“At this street [in front of the Apple store], I heard offers for 64GB iPhones for HK$8,800 and the 256GB for HK$10,500,” he said.
Chan, who had asked for half a day off work to collect his phone, expressed disappointment over the street-side offers. He had expected to earn at least HK$3,000 through resale.
“Otherwise I could just keep it for myself.”
Also unlike Cheung, Chan saw nothing bad about the quickly vanishing long queue outside the store in Causeway Bay.
“A short queue means low supply,” he claimed, adding he would try a resale centre in Mong Kok later on Friday and keep an eye open for online trading groups as well.
In Mong Kok, crowds of more than 100 people packed the pedestrian area outside the electronic resale centre Sin Tat Plaza before 10am, two hours after the first batch of iPhone X debuted in the city.
However, resellers could not push the price levels beyond HK$9,000 and HK$11,000 for the two latest models. Most of the small booths in the square advertised that they were taking reservation orders and buying.
And while the gap between Hong Kong and mainland launches has closed, denting mark-ups, some traders were looking to exploit later launches further afield.
A businessman surnamed Choi from South Korea placed an order of 10 iPhone X 256GB devices at one of the booths. He told the shopkeeper that if he received the 10 he would order 100 more next month.
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“I can resell a 256GB model in South Korea for around HK$15,000 before the phone is available in stores there,” Choi said in Mandarin.
In September, the iPhone 8 disappointed resellers and traders as demand was weaker than many had expected.
