Here’s the background:
- I sold my iPhone 4s a few weeks early before the value went down (I will write a future post titled “How to sell your old iPhone for cash” about that)
- I recently got the iPhone 5 using my verizon upgrade (see my separate post: “Profitably upgrading to iPhone 5“
For the last few weeks I’ve been using an old $16 flip phone i got on eBay and I love it! I can’t check my e-mail, I don’t get distracted by sports scores, and it allows me to spend more time doing what I want – i.e. blogging.
So I thought I would log onto eBay just to see what the value of my phone would be, and lo and behold I see auctions like this:
That’s right – $880 for an iPhone 5 that has actually already been opened – that’s $230 more than the retail price!
Seeing easy money like this on a phone I’m not going to use got me into the whole idea of selling the iPhone 5. Because its still sold out online buy 3-4 weeks (see below), people are willing to pay a lot more to get it now.
Below I’ll walk you through the process for how I did it and my approach starting with receiving it from Verizon Wireless. Here’s how I did it:
1. Open and activate your iPhone. Ideally for at least 24 hours.
When you get your brand, spanking new phone, you might be tempted to sell it straight away on eBay, shrink wrap and all to preserve and increase the value. The problem is that if you used your upgrade to get the phone, the phone is now tied to your number. If someone else tries to activate it on their line, Verizon will think it is stolen and lock it. Worse, your own account might be compromised or “frozen” because Verizon is expecting you to activate the phone but you never do. I cannot find any good documentation for this online, but please comment/e-mail me if you see something.
The answer to these concerns is to unwrap the phone, activate it on your number, and then de-activate it and go back to your old phone. This way the phone is certainly cleared, Verizon knows you have de-activated it and not just forgotten about it, and there is a good trail in their system of this. This is the practice I have seen recommended on eBay by countless sellers.
Here are the steps:
a. Remove just enough of the shink wrap to allow you to open the phone. Ideally take off the top-half only of the shrink wrap. as this will make it appear more brand new in pictures and to your buyers. Use gloves or a shirt when handling to avoid excessive finger prints.
b. Follow these instructions from Verizon on how to activate your iphone 5
c. Keep the phone activated for at least 24 hours
d. After 24 hours has passed, call Verizon Customer Service (1-800-922-0204) and ask them to de-activate the phone and re-activate it on your old phone
2. Decide how you want to sell it
Once you have your goods eligible to be sold, you need to decide what kind of business model you want to go with.
Here are your options and how I break them down
- You get to keep as much money as possible. No eBay commissions, no PayPal commissions. Just cash to you
- No hassle after the sale is done. You don’t have to worry about leaving feedback, following up with complaints, etc. It’s done.
- You don’t have to ship the thing and wait for it to arrive, etc. You meet in person, drop it off, and you’re good.
- You have to go through a lot of hassle to find buyers that are actually legit. You may get 5 leads that are either SPAM or bust for every once genuinely interested person. You have to take time out of your day to go meet potential buyers that may or may not work out.
- Your buyer pool is only as big as your city. There might be more buyers if you went online on a site like eBay where the whole country is eligible.
- Because there are more buyers, you are likely to be able to charge a higher price online.
b. eBay Auction
- Your product is advertised nation-wide/globally so you have the largest potential pool of buyers, and can potentially charge more than on craig’s list
- You sit back and eBay takes care of business. All you have to do is ship once someone buys. No waiting around and meeting buyers.
- You know the item will sell or not sell. Its an easy decision. On Craig’s list the onus is on your to do the work
- Potentially steep commissions. Auction-based pricing charges you 9% on the final value price. PayPal will charge you an additional 3%. So that’s 12% in fees
- Shipping, leaving feedback, waiting for your item to arrive, etc. can be a pain and draws out the process
- If something happens, or you get a difficult buyer, they may return the item and you have to go through the whole process agin.
c. eBay Fixed Price (Buy it now) ** RECOMMENDED OPTION**
- Same as the Ebay Auction above. However you get better commission rates. PayPal is still 3% but now eBay only takes 5% of everything above $50 in value
- Same as the Ebay Auction above. However you may get a smaller pool of buyers if people are focused mainly on auction style listings
- You have to set a price, with the potential that if you put it up for auction, you might have gotten a higher price.
d. Word of mouth, friends, etc.
- Similar to Craig’s list. No commissions
- You know the buyers you are dealing with, so there is potentially less hassle and fraud
- You know the buyers you are dealing with, so there is potential for more follow up or complaining if they dont like the item. Or if 6 months down the road the item goes defective, you may be blamed for something irrelevant to you.
3. Find a good listing on eBay and model yours after that one
I’ll write that in the next blog post. Stay tuned…