Opportunities await in secondhand and recycling gadget business

BEIJING: Ever wondered what happens to hundreds of millions of unwanted smartphones, laptops and other discarded electronic devices as consumers switch to updated gadgets every once in a while?

Nowadays, such rejected devices are finding their way to online platforms, which either resell them as secondhand goods at attractive prices or channel them to recycling firms if they are deemed low-value items.

An increasing number of young Internet-savvy shoppers, who are also environmentally conscious, are doing away with old habits of rejecting preowned goods and instead are looking for high-quality and affordable products on secondhand trading platforms.

China remains the world’s largest smartphone market. According to a report by the China Association of Circular Economy, in the past five years, 430 million mobile phones have been sold annually on average in China, accounting for 30% of global smartphone sales.

Meanwhile, about 370 million handsets were discarded in 2020, and the figure rose to 404 million last year, the report said. However, only 2% of them have been recycled using regular channels, said a report in August, citing data from the Industry and Information Technology Ministry.

Compared with street vendors who engage in mobile phone recycling, online platforms provide users with a more reliable and stable recycling channel with transparent pricing structures.

Shanghai-based electronics recycling platform ATRenew Inc, formerly known as Aihuishou – “love of recycling” – focuses on the trading and recycling of secondhand electronic products such as cameras, phones and laptops, with an aim to minimise the negative impact of discarded consumer electronics on the environment.

Established in 2011, ATRenew, which stands for “all things renew”, has opened 1,629 brick-and-mortar stores in 241 cities across the nation as of June 30.

The company reported its total net revenue grew 14.9% year on-year to 2.15 billion yuan (RM1.4bil) in the second quarter, while its gross merchandise volume reached 8.6 billion yuan (RM5.6bil), up 10.3%.

“Although our business is facing short-term headwinds from the Covid-19 pandemic, we firmly believe that the demand for electronic device recycling, trade-ins and other value-added services will grow along with the long-term development of the circular economy in China,” said Chen Xuefeng, co-founder, chairman and CEO of ATRenew.

The company now operates four business lines, covering consumer-to-business or C2B electronics recycling platform Aihuishou, B2B used electronics trading platform Paijitang, B2C secondhand platform Paipai as well as AHS Device, which concentrates on electronics recycling in the global market.

Recycled mobile phones firstly undergo irreversible information and data removal. Lower-end phones will be handed over to electronic waste recycling companies for dismantling and metal extraction, while premium castaways will be resold as used goods after professional processing.

Du Xiaochen, vice-president of ATRenew, said it is ratcheting up efforts to build online and offline recycling systems and boost supply chain capacity while reducing costs and improving transaction efficiency.

Du said the company is seeking new sources of revenue by offering smartphone maintenance, peripheral product sales and other value-added services, as well as expanding product categories covering luxury products and photographic equipment at its offline stores in first and second-tier cities.

It has collaborated with smartphone makers to launch the “trading in an old one for a new one “service, established standardised quality inspection systems, and improved after-sales services for secondhand electronic devices. — China Daily/ANN