With rumors of a new iPhone model coming next month, early adopters will be lining up for the latest, greatest smartphone, and many might be looking to sell their old devices.
Only a portion of cellphone owners resell their phones, but business research and analysis firm IBISWorld estimated in an April 2015 report that the cellphone recycling industry generates $742 million in annual revenue.
From trade-ins with your mobile carrier or other retailers to online resale channels, consumers have a dizzying number of options for selling electronics. But the ease of the transaction and the amount of money you’ll get can vary widely.
Here’s a look at what you should know before reselling a cellphone or other electronic device.
1. Understand what impacts your device’s resale value.
A number of factors impact the resale value of electronics, according to Sarah Welch, chief marketing officer at Gazelle.com, a website that buys and sells used electronics. “What model is it, and how old is it? What’s the capacity of the phone?” Welch asks. “The cosmetic condition and the functionality of the phone [and] how well you’ve taken care of the phone can impact it.”
If your phone carrier unlocks your device, and it can be used with any carrier, that improves the phone’s value. On the other hand, if the phone has any engravings, that lowers its resale value. “As you can imagine, people don’t necessarily want to have someone else’s engraving on their phone,” Welch says. “[Gazelle] would buff out that engraving, but that’s a blemish that we need to disclose.”
2. Wipe your old device clean.
Some resale channels will make sure your data is removed from the device, but just in case, it’s a smart idea to remove it yourself. Before you restore your phone to its original settings, make sure your contacts, photos and other data are backed up elsewhere.
“For Android devices, I would recommend performing a master reset through the recovery menu,” says Ondrej Krehel, founder of Lifars, a cybersecurity and digital forensics firm. “For iPhone users, you can restore the device [using the “Restore iPhone” button in] iTunes.” He suggests restoring the phone at least twice so that data cannot be retrieved.
Also remove the SIM card, turn off device tracking ( “Find My iPhone” in the case of iPhones) and make sure your cellphone bill is paid and your account is no longer tied to the phone.
3. Compare your options.
Your cellphone provider may offer you one trade-in value, while online resellers such as Amazon, Gazelle, Glyde and NextWorth offer slightly different amounts (although Welch says trade-in offers from providers help set the standard for other resellers). “They all have varying commission rates, varying fees,” says Kendal Perez, savings expert with CouponSherpa.com. “That’s why you definitely want to make those comparisons to make sure you’re getting the most money that you can out of your device.”
Some resale channels (particularly in-store trade-in options) may give you a store gift card for your device on the spot instead of cash, so you’ll want to weigh the instant convenience of a gift card versus the flexibility of cash, which may take longer to receive.
Selling directly to consumers through Craigslist or eBay may net you more money — but with more hassle and more risk involved. You’d have to wait for a buyer (versus selling to a reseller who will hold the device until they resell it) and you may also have fewer protections if the transaction goes awry (for instance, if you accept a bad check from a Craigslist buyer or an eBay buyer claims he never received the phone). “When you’re dealing with an individual … there’s always the risk that they may not be as honorable and trustworthy as a real company,” Welch says.
Another option is ecoATM, an automated machine that dispenses up to $400 in cash for electronics and can be found in over 2,100 locations across the country. You may not get as much money from ecoATM as you would from other options, but Perez points out “if you’re looking to recycle a device that maybe has no cash value, ecoATM would be a good convenient way to do that.”
4. Research the company’s reputation.
Before you mail in your device (many resellers offer prepaid shipping envelopes for this purpose), check the company’s reputation online. What do customers say in online reviews and social media posts? Are there unresolved Better Business Bureau complaints? How long have they been in business?
Disputes can happen if your interpretation of the device’s condition clashes with the company’s assessment and the company offers less money than originally promised. Welch says Gazelle occasionally needs to adjust an offer price, but the company will alert the customer about the discrepancy. “We give them the option to have the phone returned to them at Gazelle’s expense,” she says. “In some cases, [other companies] make you agree to a price adjustment without knowing what that might be.” If getting the device returned isn’t an option, note that you’ll be stuck with whatever price adjustment you’re offered.
If an unknown company or individual buyer offers you a significantly higher price than a reputable company, then proceed with caution. “Some companies will pull a bait and switch,” Welch says. Once you mail in a device to a shady reseller or buyer, you may never see your phone — or the money you were expecting — again.
Remember the old adage that if it sounds too good to be true, it probably is.
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