Market for second hand devices poised to reach 100 billion yuan

China is home to a second hand cellphone market with a value poised to reach 100 billion yuan ($14.6 billion), due to the rising number of used handsets being traded via online platforms, according to experts.

Zhu Liyang, president of the China Association of Circular Economy, said that as the government advocates simpler, greener and low-carbon lifestyles, many consumers are trading their old phones for new ones and buying second hand products.

He told a recent news conference on the recycling of discarded cellphones that research by his team showed that 50 million used handsets change hands every year in China via online platforms.

China is a major producer and consumer of mobile phones. In the past five years, an average of 430 million phones has been sold annually in the country, one-third the global total, according to the National Bureau of Statistics.

Every 100 Chinese own 114 cellphones, above the global average level, the bureau said.

Guo Zhanqiang, secretary-general of the China Association of Circular Economy, said some 400 million mobile phones lie idle every year in China, adding that if 25 percent of them fetched 500 yuan ($73) each, this would be extremely big business.

He said that if these devices were dismantled carefully and not damaged, 95 percent of the 100-plus components in smartphones could be reused.

Guo added that recycling components in phones as raw materials, and trading second hand phones are poised to create a business with a market value of 100 billion yuan.

For example, ATRenew, a listed company headquartered in Shanghai that runs the second hand platform Aihuishou, has experienced robust business growth.

In 2018, the company sealed 6.9 million second hand deals with a gross merchandise value of 5.7 billion yuan, according to Tian Mu, senior brand director. Last year, the number of deals clinched by the company rose to 31.2 million, with a gross merchandise value of 32.5 billion yuan.

Guo said that about 70 percent of all these deals involved second hand smartphones.

Wang Chaotong, head of retail at consumer electronics company's Suning's online business, said consumers receive a high discount of 20 percent if they choose to trade their old mobiles for new ones.

"In general, the business of trading old cellphones for new ones is growing at Suning," he said, adding that one in every five new phones is now sold at the company is conducted in this way at the company.