Chip crisis
Repairs instead of new purchases – used technology in demand
Repair of a cell phone in the Komsa AG workshop in Hartmannsdorf, Saxony. Photo: Sebastian Willnow / dpa-Zentralbild / dpa
© dpa-infocom GmbH
The electronics industry suffers from a shortage of chips. At manufacturers of smartphones, for example, there are delivery bottlenecks. Providers of reconditioned electrical goods play that into the cards.
If the display is scratched or the battery runs out quickly, you don’t have to get a new smartphone straight away. Often it is enough to replace worn-out parts and thus enable the device to have a longer life.
Suppliers of refurbished articles have been seeing it that way for a long time, but are currently even more pleased: Because of the current shortage of materials, such as chips, there are production difficulties and delivery bottlenecks for many manufacturers of smartphones, tablets and the like. “It really always has to be the latest product be? Or can’t it also be a product that is as good as new? ”Asks Kilian Kaminski, co-founder of the Refurbed repair platform.
From the entrepreneur’s point of view, the consumer behavior of many customers has changed. “The interest in refurbished products has increased enormously,” says Kaminski. The shortage of chips and the general shortage of raw materials probably also contribute to the fact that more people are dealing with the consumption of electronics, he says.
Better use of limited resources
“Buying fewer new goods and using more remanufactured products can help to deal better with limited resources,” says Martin Hügli, Head of Back Market in Germany, an online platform for the sale of refurbished electronic devices. After all, refurbished providers often only replace broken parts of used electrical appliances and then offer them again for sale. As a result, companies are rarely dependent on large quantities of new materials or chips, explains the President of the European Refurbishment Association (EUREFAS), Augustin Becquet. The industry is now benefiting from this.
For example, the association has noticed a high level of demand for refurbished, older iPhone models, says Becquet. This could be due to the shortage of materials, which led to production and delivery difficulties with the recently released iPhone 13. Instead of buying the latest device, customers have to switch to older, already used copies. However, the association does not have any figures on this.
A lack of material depresses sales
“Current sales forecasts for the new iPhone assume that fewer devices will be sold due to the lack of chips,” says Hügli. In fact, Apple CEO Tim Cook reported in October that bottlenecks in the supply chain and Corona outages in production depressed group sales by six billion dollars. The dealers of refurbished goods, on the other hand, often work with older models where enough components are available, explains the back-market boss. “That’s why we don’t have any scarce stocks.”
The shortage of new goods can also motivate many to buy used equipment, says the managing director of the Technical Trade Association, Steffen Kahnt. However, the association sees Refurbished as a niche. Although refurbished devices have long been a relevant alternative for price-conscious and environmentally conscious consumers, the market is still “very small”.
In addition to the material aspect, the business model has other advantages, says Niklas Meyer-Breitkreutz from the Bitkom digital association. “Customers also save money and even receive a guarantee on the devices again.” In general, therefore, the demand for refurbished electrical appliances has increased in recent years because of the “environmental awareness of Germans”, says Meyer-Breitkreutz. He advocates using devices longer and thus minimizing the CO2 footprint. After all, around 206 million cell phones and smartphones are slumbering in the drawers of German citizens that could be reprocessed and reused, according to a survey carried out on behalf of Bitkom.
A boost for recycling
Manufacturers such as Apple and Samsung already offer to trade in the old one when purchasing new devices. They are processed or recycled in order to recover raw materials. According to Apple, 10.4 million devices were refurbished and 39,000 tons of electronic waste were recycled around the world last year.
Should the shortage of raw materials persist and affect the prices of electrical appliances, Marion Lichti from the IT retailer AfB sees this as an advantage for the industry: “Good, reconditioned used goods are attractively priced and the more attractive the prices of new appliances, the more attractive.”
When buying outdated smartphones, prospective customers should not only pay attention to the hardware, but also to the software. It is desirable that the most current version of the operating system can run on it. At Apple, the latest operating system is called iOS 15. For this you need an iPhone 6s, iPhone 6S Plus, iPhone SE (1st generation) or newer. With Android, the situation is confusing because of the many manufacturers. The current version 12 is sometimes not even installed on new devices. But the same applies here: the newer the Android version, the better.