Rains, CDMA affect used handsets market

It seems that the July rains is going to continue, thereby adversely affecting the various types of businesses in the city. The latest one to be affected by the natural calamity, though not directly, is the second-hand mobile market, where demand has fallen by more than 60 per cent.

Since a cellphone is an electronic device which easily succumbs to water, the rains have proved to be a deterrent for many of the customers who were to buy a second handset.

"The market has been affected due to the rains. It is very down. We are getting very less customers," said Ritesh Mehta of Mobile Point.

During the rains and afterwards, a record number of mobile phones were brought for repairs at various mobile shops. This has added to the fear of customers regarding the quality of the handset.

"The sales of second-hand sets have dropped down. We were selling 70 - 80 phones per month, whereas right now, the sales stands at around 30. In fact, sales of new sets has substantially increased," said Saleem Yunus, a Nokia dealer at Jogeshwari. The cost of a second-hand handset ranges from Rs 500 to Rs 7000.

However, the sad part of the story is that some dealers were forced to shut down the second-hand business as it is not that much lucrative as it had been before.

"We closed down the second-hand mobile business just a month back. Customers kept coming back with various types of faults in the mobiles, which really bothered us a lot. So, finally we switched off our second-hand cellphone business completely, as the customers have become sceptical, thereby bringing down the business," said Mithilesh, another Mumbai based mobile phone dealer.

Hitesh Vikmani of J B Telecom, is another dealer who has pulled his hands out of the second-hand mobiles business. "Customers always come with unpredictable problems. To top it all, the rain has worsened the number of new customers," Vikmani said.

It is not just the rain that is the only factor, which is downsizing the second-hand mobile market. The decline in the prices of new mobile sets is another factor responsible. "The rates of the new hand sets have dropped so much that the customers think that is better to go for a new one," Vikmani added.

Also, the customers get a warranty of one year on a new handset. "If you go for a second-hand mobile, you don't get a warranty along with it," said Ritesh Jain, Alko Telematics at Fort.

Further on Jain said that another factor affecting the handset market is the CDMA technology. It is giving a tough challenge to the GSM sets. The sets are relatively cheaper and offer various customer-friendly facilities, making the mobile phones pretty affordable.

"All these factors have a cumulative effect on the second-hand mobile market. Earlier on, I was selling 5 second-hand handsets daily. Now, it has dropped down to just one, which, is a drastic decline," he added.