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Buyer’s Guide to the iPhone X

Getting smart about smartphones –  It’s in your pocket. It’s in your hand. And increasingly, it’s in your display case. The iPhone X is the 200th most popular item coming in and going out of pawnshops as of March 2019. Read More

Getting smart about smartphones – 

It’s in your pocket. It’s in your hand. And increasingly, it’s in your display case. The iPhone X is the 200th most popular item coming in and going out of pawnshops as of March 2019. With an average loan amount of $265 and default rate of 23%, there’s a lot to consider. The iPhone X takes 50 days to sell, sells on average for $423, and has an average profit margin of 22%. Let’s dive into the Buyer’s Guide to the iPhone X.

Smartphones are a fact of life; nearly everyone is carrying around a supercomputer in their pocket these days. And they’re using it for everything from communicating with their friends, to navigating to that hot new restaurant across town, to leaving a review of said restaurant once the table is cleared.

Being as smartphones are equal parts ubiquitous, essential, and forever-updated, people are constantly trading up to new units with regular frequency. Since pre-owned phones can be a real bonanza for budget-conscious buyers, it’s somewhat incumbent upon pawnbrokers to be de facto tech experts. Staying on top of trends and knowing what to look for can really boost your bottom line. So the next time a customer comes in smartphone in hand, here’s a crash course on how to suss out when to say buy, and when to say “bye.”

Let’s take a closer look at how to buy one of the most popular smartphones on the market: The Apple iPhone X.

Apple’s Core: The iPhone has been the backbone of Cupertino’s favorite fruit factory since 2007, when the first handsets débuted to consumers. In the years since they’ve only grown more popular with loyal users. Even though Apple’s most dedicated fans still wait dutifully in line every year for the latest and greatest unit, there will always be folks looking for a deal on slightly older models with plenty of mileage left. And since so many people upgrade on an annual basis, chances are, you’ve seen plenty of pre-owned iPhones come through your doors…usually held by folks who are looking to take a little off the top of the newer one they just bought.

Even though nobody really knows when the next iPhone will drop, Apple’s release schedule has still largely revolved around the idea of an annual keynote announcing what’s coming. Given that the iPhone X was both a huge seller, and is creeping up on two years old? Chances are, you’ll be seeing quite a few of them coming in — if you haven’t already.

So, how do you tell garbage from gold?

The Basics:

First and foremost — look at it. We all know people who take great care of their personal effects. Their phones are impeccable; not a nick, not a scratch, kept in a case, and treated with kid gloves…figuratively speaking. But we also know people who can’t be bothered. Their phones are smudged, dinged, and maybe even screen-cracked beyond recognition. These phones have fallen from the top of speeding cars, had drinks spilled on them, and been sat on. It happens.

Obviously, as with everything you buy, it’s up to you to determine acceptable levels of wear. Cue question one in Bravo’s Estimator: Condition Rating.

Not much that’s been used manages to stay looking 100% out-of-the-box fresh, but some are certainly going to be closer than others. Some customers care about this kind of thing, others are more concerned about function over form. But since the first thing any customer is going to notice is what kind of external shape the phone is in, you may want to pass on units that look like they’ve been through the wringer. Especially if they’ll be sitting in a case next to closer-to-pristine pieces.

So, check it over. Make sure it doesn’t look like it lost a few rounds to the pavement, and/or washing machines. And feel free to pass if it looks like it’s been kicked around or chewed on. Because your customers sure will.

Power Up: Another obvious step: Turn that sucker on. It should power up with no issue. If it doesn’t? Yeah, we’re done here. If you’re greeted with a cheerful Apple logo, that’s a great first step. And, crucially — it has to open up when YOU turn it on…but more on that in a minute.

Next, check the frequent fail points. Test the buttons. Swipe the screen a couple of times. Open a few apps. Try connecting to your store’s WiFi. Play some music or a YouTube clip to make sure the speaker is putting out clear sound. Maybe even take a selfie to see to it that the camera is still up and running. Overall, just make sure everything is snappy and responsive. A quick rundown should tell you most of what you need to know about the phone’s working order.

Mind the Moisture: A lot of us have had to deal with water-damaged phones. Many a smartphone in years past has met its demise after a quick dunk in the commode, accidental fall into a pool, or tumble into a rain puddle. And while Apple has made some great strides when it comes to keeping its powder dry, it still has its limits.

The iPhone X is rated as an IP67 product…which is really just a fancy industry manufacturing standard meaning it can survive a soak up to about three feet deep, and come out largely okay. Still, it’s not exactly waterproof, just far more water resistant than its predecessors. So, if water damage is a concern, there’s a sneaky way to check.

Pop out the iPhone X’s SIM card tray (instructions on how to do that can be found here), and check the moisture damage indicator. If the phone has taken a bath? The water indicator will be red. If it’s not, it hasn’t. Simple, but a crucial thing to be aware of.

Accentuate with Accessories: Is the seller bringing in a lonely, naked phone, or do they have at least some of what it came with? Certainly, what you choose to include in bundles (vs. parting out as components) is always up to you. But since many smartphone-buying customers are looking for as close to a “like-new” experience as possible, it may help to take a look at some extras.

Bravo’s Estimator helps ensure your employees ask the right questions on Cords, Cables, and Attachments: Does the seller have the charger? Wireless earbuds? Connection cable? And if so, what kind of shape are they in? The more you can include with the phone as a “complete” item out the door, the more value it will have to your customers.

Consider the Carrier: This one’s a little sticky, but many iPhone X units were originally sold through cell service carriers. As a result, they’re “locked” (i.e., restricted to only being used by the carrier who initially sold them, such as AT&T, Verizon, T-Mobile, etc.). Unlocked iPhones do exist, but they’re not as common as their tied-down counterparts.

When the phone powers up, check its current carrier, and locked/unlocked status (you can find instructions on how to do that here). Make sure to enter this information into the Estimator under Lock Status. Once you do, you’ll have a better idea of which network(s) the phone will work on. Customers buying phones typically already have service through a specific carrier, and they’re going to want to know that they can just pop their old phone’s SIM card into a new handset and keep right on rolling without any issue. Trust me, nothing annoys a customer like buying an expensive phone, then finding out it won’t work with their existing service account.

Stop, Thief!: We wish it were otherwise, but shady sellers are a fact of life. And since phones are small, portable, and easily lost/stolen, sometimes that shiny Apple unit turns out to be a purloined piece of produce. And, since you’re a responsible pawnbroker who follows all of the local rules and regs when it comes to the buying and selling of secondhand merchandise, you’ll want to employ your usual concern.

Thankfully, the Cellular Telecommunications Industry Association offers a handy online tool to help. CTIA’s Stolen Phone Checker site maintains a database of phones that have been reported lost or lifted. All you need to do is input the unit’s IMEI number (more info on how to find that here), and enter it into the form. Bravo’s ESN question will ensure your employees check this important box. CTIA will let you know if you’re good to go, or if you’re dealing with a hijacked handset. The site does require you to register an account, but it only takes a moment, and the benefits are more than worth it.

Wiped Clean: This is possibly the most crucial step. If a customer is selling you a used phone, they will need to have already done a hard reset on it. Sometimes this is called a “factory restore,” or a “wipe.” All that means is that they’ve performed a built-in sequence that restores the phone to the same state it was in the day it was taken out of the box as a brand-new unit.

Since we all trust our phones with a lot of sensitive and personal information, it’s a necessary step for the customer to get rid of all of that before handing over the phone. Contacts. Passwords. Banking information. Texts. Emails. Apps. Photos. And most importantly, user login permissions. It all has to go. A factory reset removes all of that and takes the whole thing back to square one.

But — and this is very, very important for your bottom lineonly the owner of the phone can perform this operation, and they will have to do it before you can buy the phone.

Since doing a factory reset on the phone wipes everything from it except for the original operating system, it is a deliberately involved, intentionally multi-step process; one designed to prevent accidental data loss. Because of that, ONLY the person who is the current owner of the phone can perform the reset operation. Meaning, if you buy a phone that the original user has NOT done a factory reset on, you just bought a pricey brick. Again: you will not be able to access a secured phone yourself in order to initialize the reset procedure, and the phone will be useless to both you and your customers at that point. You should be able to tell whether or not the phone has been reset when you first turn it on. If the customer still needs to use their own passcode or FaceID to open it up so you can look it over, they haven’t done their due diligence yet, and you’ll have to let them know as much. And refuse to even look at the phone until they do.

Remember — Apple’s security is so legendarily user-focused that the company’s refusal to allow anyone but a phone’s primary owner to access its contents made national headlines and federal court dockets a few years ago. If the FBI has that hard of a time getting into an iPhone that isn’t theirs? Then chances are, you’re out of luck, too.

As always, this is in no way meant to be a comprehensive how-to as much as it is a collection of good ideas to bear in mind. You’ll, of course, have your own in-store policies that govern how and why you buy and sell the ways you do. Trust your processes, and trust your gut. Technology moves fast, though…So staying on top of ever-changing best practices is always an advisable idea.

 

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