In Hong Kong, iPhone XS scalping musters a pittance in profits
Hong Kong might technically be separate from China, but it pays a steep price for a new iPhone regardless: for a US$999 iPhone XS in the United States, Hongkongers pay just over $1,100.
And every year, it’s a race to the Apple Store on sales day to buy as many units as possible to resell to hawkers making their way up to China, where a base iPhone direct from Apple costs $1,269. You can bet the margins get exponentially crazy from there.
But the South China Morning Post reports that only “several dozen people” had lined up for the 8am open at an Apple Store in Hong Kong Island yesterday as opposed to the hundreds in years past. Those who were picking up reservations were then tendered bids ranging from just HK$1 (US$0.13) to as low as HK$100 under the retail price. Many decided against selling to scalpers for the first time. Local forum users claim that area marketplaces were tendering offers as low as HK$399 below retail. Only the 512GB iPhone XS Max was commanding any measurable margin at up to HK$1,101 (US$128).
Traders believe that the large display of the iPhone XS Max and the half-terabyte storage are the only appeals. But the bigger detractor seems to be Apple’s quickening distribution scheme. Whereas in recent years Chinese stores usually got the new iPhone in a later wave, it has started receiving stock on the first date.
Across the border in Shenzhen, a local buyer picked up an imported 64GB iPhone XS Max at the equivalent of $1,429. Believe it or not, that’s only a $16 premium from Chinese retail price and he got it without waiting at least 10 days for shipping and handling.
Still, other sellers see more sales going to the iPhone 7 and iPhone 8 if consumers truly still want an Apple phone in their life while many are flocking to domestic competition from the likes of Huawei, OPPO and Xiaomi.