It has never been easier set up your own online business. From digital marketplaces like eBay and Amazon to ecommerce platforms like Shopify and and Magento, there are dozens of options that make it simple and straightforward to get into retail with minimal prior experience and technical expertise.
If you are looking for an online retail business to get into, look no further than used mobile phones. The pre-owned mobile market is booming, growing at an average of 10% worldwide every year while, by contrast, sales of new devices shrink. By 2022, sales of second-hand mobiles are predicted to be worth $50bn.
So how can you take advantage of this massive growth market while it is still red hot? Here are five steps you need to take to get your own thriving online used phone business off the ground.
Build an ecommerce site
The first step for any new online business is to have somewhere to sell from. For a quick start, auction and marketplace sites like eBay remain the easiest option. As well as being simple to sign up to and having everything you need to start selling already in place, they also give you access to a huge ready-made audience.
There are drawbacks to relying on sites like eBay, however. They take a commission for every sale you make, you have to abide by all sorts of regulations and you are limited in how much you can build your own brand and grow your business. To put it bluntly, sticking with eBay means remaining small time.
Nowadays, with ready-made ecommerce platforms like Shopify, Magento,Wix, Weebly and so on, it is not that much more complex to set up your own complete used phone web store than it is to become a seller on eBay. With easy drag-and-drop site builders, you can create fantastic looking stores quickly and with minimal technical know-how. You can register your own domain name to create and protect your brand and you get full control of everything to do with the site, all for a reasonable monthly fee. Have a look at this article for more info about building an online store.
Source used mobile stock
Once you have a site, the next thing you need is some products to sell. The first second-hand mobile phone traders relied on sites like eBay and listings services like CraigsList and GumTree to source their stock, looking for anyone selling old mobiles or else advertising that they would buy them for cash.
But this involved a lot of hard work and there were never any guarantees about the quality or condition of the devices purchased. Nowadays, all that has changed. As the used phone market has grown, a professional and reliable wholesale market has emerged to service the retail trade.
Phoenix Cellular is Europe’s biggest supplier of pre-owned mobile phones. Rather than retailers having to source their stock themselves, we provide a convenient one-stop-shop with all the biggest and most popular brands available. Not only that, we test, grade and guarantee the quality of every handset we supply and provide next-day delivery throughout Europe, so you always get the stock you need in good time.
Set up payments
No business is able to function without having a means of accepting payment. With any online company, cash is obviously out of the question. In times gone by, retailers had to jump through all sorts of hoops to be able to accept credit and debit card payments, making appropriate arrangements with their banks and merchant services.
Nowadays everything is much more simple. If you want to add payment and transaction processing to your ecommerce site, there is, as they say, an app for that. Third party service providers like PayPal act as a middleman so you don’t have to deal directly with financial services providers – they do all the technical work for you, and what is more, the major vendors provide apps that plug directly into your site, automatically setting up a shopping cart and checkout service.
Alternatively, ecommerce platforms like Shopify now offer their own fully integrated payment services as part of the subscription, giving you one less third party to think about dealing with.
Familiarise yourself with trading and tax laws
Retail laws apply equally whether you are trading from a bricks-and-mortar shop or online. Once you get started with an ecommerce business, it is therefore important that you comply with regulations relating to consumer protection and trading standards. In the past five years, many of these laws have been updated to reflect the growth in online retail.
In addition, every organisation with a presence online now has to be up to scratch with GDPR data protection and privacy regulations. Amongst other things, these place strict restrictions on how you collect and use customer data via digital channels, requiring you to be completely transparent whenever you want to so much as save or use an email address, and to demonstrate you are taking necessary steps to store all personal data securely.
One particular tax regulation it is well worth all used phone retailers is the UK being aware of is the VAT Margin scheme. If you generate a turnover above the VAT registration threshold (£85,000), the VAT Margin scheme allows you to calculate VAT on the sale of second-hand goods in a different way to normal and using a lower tax rate – the key message being, it will reduce your tax bill. You can read more about how marginal VAT works here.
Reach out to your target audience
Finally, once you have all the other ingredients in place – an online store, stock to sell, a means of processing transactions and accepting payment and you are confident you are compliant with all relevant rules and regulations – the final piece of the jigsaw is arguably the most important. You need some customers.
Whole libraries worth of books have been written devoted to the subject of how a new business goes about acquiring a customer base. There’s not the time here to go into detail, but the three golden rules are:
- Be seen: Online retail is a crowded place these days, so making sure people can find you in the first place is a matter of getting to grips with SEO (search engine optimisation) and being active on social media, amongst various other marketing strategies. Also, even if you build your own ecommerce site, many businesses find it helpful to also sell on marketplaces, and Amazon in particular, just because of the sheer volume of people who use them.
- Grab attention: Once you are seen online, you have to offer something that makes people want to buy from you. The great thing about used mobile phones is the value proposition. Many of the top graded and reconditioned phones we stock are premium range smartphones less than two years old and in near perfect working order, yet our clients can sell them at less than half the RRP for an equivalent new handset while still making a solid profit.
- Deliver exceptional service: It is a well worn saying in business that keeping hold of customers costs a lot less time, money and effort than attracting new ones. So once you do get people buying pre-owned phones from you, make sure they will bear you in mind for the future – or, perhaps more pertinently, recommend you to their friends on social media or leave a good review. Rapid fulfillment of orders is a must, and on high cost gadgets like phones, free delivery always goes down well. You might also consider selling branded, boxed used phones like our GR8 Mobile range, which come with free accessories and include 12-months full warranty, to boost the chances of customers feeling they are getting best value and service.