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Apple Inc. (AAPL) Selling Cheap Refurbished iPhone 6s Online, But They Won’t Last

Apple Inc (AAPL) iPhone

Apple Inc. broke another of its long-held corporate culture earlier this week with the official sale of refurbished iPhone on its online store. The iPhone is Apple’s main cash cow and the firm milks it for all it is worth. The firm has a culture of not selling refurbished iPhone even though it sells refurbished iPad, iMac, MacBook, Apple TV, and Watch in its stores. Many people have tried to get official word on the firm’s reason for not selling such devices but the firm has largely kept mum.

Now, Apple’s U.S store has a stock of refurbished iPhone 6S. The phones are certified good by the firm, they come with an official one-year guarantee that you can extend to two years for $129 with AppleCare. The devices have original Lightning Cable, Power adapter, headphones, and they come in the same packaging as new products.

Here’s why Apple didn’t sell refurbished iPhones until now

Apple Inc. ‘s decision not to sell refurbished iPhones before now is a smart-business strategy. The firm makes about 4X more on each iPhone it sells, that is why the firm takes about 90% of profits in the smartphone market even though it controls less than 15% market share. More pointedly, teardown analysis suggests that it costs Apple about $211.50 to make the iPhone 6S and $236 to make the iPhone 6S Plus; yet, the device retails for about $750.

Many people have opined that Apple could unwittingly erode the prestige factor of the iPhone if it starts selling refurbished ones. Many people buy the iPhone for its elitist strategic branding; hence, the idea of used/refurbished devices waters down than premium feel. More so, if you really want an iPhone you’ll find a way to pony up the money for the device. Hence, the firm would be needlessly selling its devices at a discount if it offers refurbished iPhones.

Another point to note is that the firm’s last official attempt to sell its refurbished iPhone didn’t end well. In May, the Indian government denied Apple’s request to start selling its refurbished iPhones in India.

Why did Apple change its mind about selling refurbished iPhones

A critical look at the Apple Inc. ‘s store shows that the firm only stocked refurbished units of the iPhone 6S and the iPhone 6S plus. The 16GB iPhone 6S sales for $449 and 16GB iPhone 6S Plus sells for $529. The refurbished 64GB iPhone 6S Plus sells for $589 in the store. However, the interesting point to note is that the firm stopped making the 16GB and 32GB versions of the iPhone 6S when it unveiled the iPhone 7.

In essence, it appears that the firm is sell the refurbished iPhone 6S in order to disposes off its stock of returned iPhone or the unsold devices in its inventory. Hence, one could argue that the firm’s move to sell refurbished iPhones in its store doesn’t necessary mean that the sales of refurbished iPhones will not become the norm after the firm sells all the remaining iPhone 6S.

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Victor Alagbe is a seasoned business and finance writer with a specialty in writing about how to invest for the long-term in healthcare, pharmacology, energy and tech stocks. His long-term focus is on stocks that provide a nice mix of growth and income. For the short term, he passionately writes about trading stock options for the excitement and leverage that stock options offer.

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