Back Market, Remade… the juicy and opaque business of refurbished smartphones

White coats, neon lights and silence… We are not in the emergency room, but in the workshops of Itancia. Here, in the middle of the Anjou countryside, about thirty employees daily operate 700 old smartphones with an open heart. The tasks performed require concentration, especially when a battery needs to be replaced – a maneuver that takes seven minutes. “You have to go slow: if you pierce it, it can explode,” explains one repairman, taking off the rectangle of lithium. This happened to him once, witness the black halo on his workbench.

In this case, to limit the damage, “we immediately put the smartphone in a bag that keeps the heat in, and everyone gets out. But it’s rare, about once a year,” explains the production manager. not that complicated, a series of tests are performed at 30 to 50 checkpoints, to make sure everything works, before they leave for a second life.

Like this company, which will soon be expanding its premises, reconditioning players are unlikely to weaken activity. While the market for new smartphones in France fell 6.5% in 2018, according to the research institute GfK, sales of second-hand phones increased by 7% in the same year, or 2.1 million units sold. This means that one in ten French people now opt for a second-hand device… There are many reasons for this enthusiasm, sums up Thibaud Hug de Larauze, co-founder of the Back Market site: “The best-selling telephones date back two years, and they are now available for almost half the price, with a guarantee…

This approach seduces, beyond the lovers of ecology. The discounts are indeed impressive, for products that are generally satisfactory. Pioneers see their intuition rewarded: Back Market, Recommerce and Remade, first of all, are booming. They are available online and with reseller partners. But everyone falls for it. You can now find recycled iPhones and Samsungs directly from telecom operators, in hypermarkets and department stores (Boulanger, Fnac Darty or Electro Dépôt), and at historic e-tailers (Amazon, Cdiscount or Veepee, the former Venteprivee.com). So many choices can be confusing, especially since this market isn’t the most transparent.

The first unknown is the origin of these smartphones. Impossible to know, when buying. Buyers prefer the iPhones, which are considered robust, whose prices have exploded to more than 1000 euros in new condition. The industry’s little secret is that in order to obtain very large quantities of second-hand goods, you have to get supplies from the United States – where Yoann Valensi and Laure Cohen, co-founders of the Certideal site, get their supplies first. “We have contracts with American operators. There people pay very expensive packages, including the telephone, replaced regularly.

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Abandoned, little-worn appliances are a reconditioner’s delight. This is even more true for Remade, which is 100% focused on Apple products. This heavyweight sold 500,000 copies in France last year, for a turnover of about 140 million euros. Ludovic Saint-Aroman, director of marketing, says he prefers large suppliers: “Operators, insurers and wholesalers, American and European.”

There are other sources of delivery, sometimes more random. At Certideal, 15% of the processed devices are old models of customers, who receive a discount on their new purchase. Other models come from major brick-and-mortar retailers: Boulanger returns them for example customers’ smartphones, withdrawal cases, exhibition models. It is even more varied for Back Market, a site launched in France in 2014 and already present in the United States, Germany, Spain and Italy (last year turnover 230 million euros).

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As a marketplace, it collects offers from a wide variety of sellers. There are small suppliers, such as the Angevin Itancia, all rated for their reliability. Itancia has achieved a good score, in particular by equipping itself with “corporate fleets”: professional smartphones are regularly replaced and are generally in good condition. Finally, a surprise: some of the best Back Market providers are small thrift stores, Cash Converters or Easy Cash. Experts and responsive, they are often highly regarded.

Buyers are also largely unaware of what the actual condition of their new phone will be. All the sellers explain that they carry out numerous tests on repaired smartphones in their workshops. They control the operation of the microphones and speakers, the camera or the screen. But it is impossible to know, for example, whether the smartphone screen has been repaired – an operation that very often leads to malfunctions or display problems. Marketplaces try to advertise the color as much as possible by presenting quality levels ranging from “as new” to “presence of significant scratches”. Above all, they offer reassuring guarantees and promise a responsive after-sales service.

At Back Market, an algorithm marks the bestsellers, assisted by 50 Bordeaux employees who are responsible for monitoring the trustworthiness of these independent traders. This effort allowed the site to divide the number of defects by two within six months of purchase: 10% of the products a year ago, compared to 5% today. Remade has opted for a high-end approach in its high-tech factory in Avranches (Manche). All smartphones received are disassembled, cleaned, polished and reprocessed in chemical baths by 500 employees. The rear hulls have even been repainted and anodized to reinforce the aluminum, and all models feature a new battery…

Because the big black spot in this market remains the issue of the battery, which is sometimes very defective and does not last all day. This is the problem most often mentioned by disgruntled people on online forums. Certideal offers every customer the opportunity to opt for a new battery for an extra 25 euros, “the cost price” (a quarter of buyers do this). At Back Market “it must be at least 80% equal to that of the new product, otherwise it will be too disappointing for the consumer”. The same policy at Itancia: “If we do eco-cycling, it would be absurd to replace all batteries if they are 80% good,” emphasizes Lionel Troteseil, marketing director. Paradox: The day of our on-site visit, a large batch of iPhones from the United States showed 100% new batteries, already replaced by another service provider…


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