Out with the old and in with the new. David Crookes looks at the growth of recycling websites and explains how to maximise your gadgets' cash potential
We change our gadgets so often that, in the near future, we may cease to measure the passing of time in years but by the type of mobile phone we had in our possession. "Ah, I remember that Summer of iPhone 5 so well," we may one day gush, as memories of 2013 come flooding back. "It was certainly better than that Winter of the Nokia 3210. Oh my, do you remember that?"
It may seem silly but there is no doubting our insatiable appetite for the new. Tech changes are fuelled by the mobile phone service providers who chuck free phones our way when a contract comes to an end, sped up by the annual revisions to laptops, handsets and tablets, and driven by such overwhelming choice that - taking videogames as an example - you've barely got off level four before another eight or nine games queue up for your attention.
There is nothing wrong with moving forward, but it does lead to waste. At the last count, we are said to be buying 30 million phone handsets each year; we keep them for an average of just 18 months before upgrading to something new. As a result, so much technology gets stuffed in drawers or stashed in the loft that we forget there is money in old rope: indeed, more than £6.86 billion worth of unwanted mobile phones are believed to be cluttering up our homes in the UK. So what should we be doing?
For many people, the answer has long been obvious: sell your item privately, hand it over to a friend, colleague or family member or stick it on eBay. However, over the last few years, one of the most popular trends has been to sell gadgets to a recycling company - and a large number of firms having emerged to help relieve you of your unwanted phones, tablets, consoles, laptops, games, software and other such goodies.
Many of these exist online. The likes of Fonebank, Mazuma Mobile, Simply Drop and the Phone Recycle Bank are quite happy to exchange electrical goods for cash, refurb companies like Gigacycle (www.gigacycle.co.uk), the sister company of Gigafurb, will deal safely with old computers and other IT equiment in line with the strict WEEE Directives imposed by the European Union, while ensuring your data is destroyed along the way, and a good number of firms can also be found on the high street. Aside from stalwarts CeX and Cash Converters, retailers such as Game have been branching out. Not merely content with letting you trade-in games for cash or credit, Game has been snapping up customer's mobile phones and hardware. Even supermarkets are getting in on the act nowadays.
The way it works is simple. "We give our customers a price upfront for their item, send them some packaging and wait for them to send their item to us in the post free of charge," says Richard Mavers, Redeem's head of client marketing. "We then scan the item, send an email to the customer to let them know it has arrived and put it through a grading process, checking what they customer has told us against the actual condition of the item."
The amount of time a recycling company employee spends with an item varies depending on the type of gadget it is, with a timescale ranging from 30 seconds to four minutes. Smartphones take longer than dumbphones because of the software that is used, and the need to check that data has been cleared. Apple iPhones are the most tricky according to the recycling companies (no surprise there), with Samsung's and Nokia's proving easier to process.
"We do some internal testing and either give the agreed price or alter it, perhaps because the screen is smashed or there is something wrong with it," says Mavers. "We always communicate with that customer and let them know the price we are offering and they can accept or reject it. If they accept, the customer is paid but if they don't, it is sent back the same day for free."
Redeem is one of the main players in the recycling market, running a number of brands including O2 Recycle, Money4urMobile and Envirophone. It also has a corporate arm that buys equipment from large companies, banks and retailers. Its 300 staff deal with as many as 150,000 items each month and it has a turnover of some £70 million. What that shows quite starkly is that the business of buying your old kit is big - and very lucrative.
Then again, there is gold in them thar gadgets. Or at least some kinds of precious metals. After checking for faults, potential water damage and cosmetic blemishes, expensive handsets made by premium brands may be given new screens or replacement back covers to increase their value, but phones that are excessively damaged will be dismantled. Their batteries, camera modules, speakers and main boards will be removed and they will be most likely used to repair broken handsets that can then be sold on. Very old phones are mined, with even the gold and copper from sim cards being sent to refineries to be smelted down. Nothing is wasted and everything has a value.
"We assess resale value on the second hand markets," says Ashley Payne, director of Cash In Your Gadgets. "A lot of earlier phones, for instance, are sold to export markets and developing countries - around 80% of our sales are to Africa, the Middle East and Eastern Europe."
So how do you make sure that you are getting the best value? Well, it doesn't take long before you realise that the recycling market is incredibly fast-changing. Although digital camera, tablet and laptop recycling prices are rather static - laptop prices are often only altered every three months, during peak periods, trading in old phones can be similar to getting active on the currency market as prices can alter on an hourly basis. You can only get the best price as of the moment you search and it can be a gamble to wait even a couple of days. Timing is everything.
"It's all about supply and demand," says Mr Payne. "If a new product comes out, there will be rise in the number of old items being recycled. We anticipate this and we alter the price we pay downwards. Things then level off and become more static and the price alters again. You see this kind of fluctuation more with mobile phones. It's less of an issue with laptops or digital cameras, say, where new processors don't affect the previous generation that much, if at all - there isn't the same rush to sell older items; it only really has an effect on those who have a high-end use for their items."
So choose your moment. When a new iPhone or Samsung launches, lots of customers trade in their phones, which saturates the market. The best time to sell is in the lead up to a launch or a little while after when the market settles again. So, if you feel the time is right, how do make sure your get the best price for your item? That's easy enough: shop around.
More than 60 gadget recyders have emerged online over the past five years and the prices they offer can vary wildly. Just as with the insurance market, comparison websites exist - like MoneySavingExpert.com's MobileValuer and CompareMyMobile.com. Searching for the value of a 16GB iPhone 5 shows just how prices can fluctuate - from as little as £40 with fonehub.co.uk to £107 with funkymob and Apple Recycle. A little bit of research can therefore reap dividends.
"The range of prices is simply down to the exit routes these companies have got," says Ashley Turner, co-founder of CompareMyMobile.com, referring to the ways in which the recyclers dispose or sell on the items they receive. "But customers also need to look at what companies want in return for your payment. One or two recyclers will pay you an extra couple of quid for a box and charger, for instance, and others will give a good price only for items in the best condition. You have to be very clear what you need to have and do to hit a headline price."
Luckily there are some easy steps to maximising your item's potential. First of all, look after your items. "That rubber retro Game Boy phone case you bought for a fiver might well pay for itself," explains Jonathan Cronin, CeX's brand and communications manager. "Our grading system pays more for working phones in good cosmetic condition and, as much as it's not needed you will often get more when selling if you've kept the box, instructions and accessories."
As we also explained earlier, you also should sell at the right time. "Sell early," Cronin continues. "If you're thinking of switching a Galaxy S4 for a Galaxy Note 4, you'll get a better price if you can bear to part with your existing phone a few weeks before the new one comes out then you would if you follow the market and exchange on release day."
The next step is to ensure your item is working for you. "Make sure your phone is unlocked or at least locked to the right network," says Mr Mavers. "We give less money for phones that are locked to Vodafone and EE as opposed to O2 because it costs our business money to unlock those phones. People can get more money by unlocking devices before they sell. Customers could get £20 to £30 more for a handset if they call their network beforehand and get them to unlock the handsets for free."
It is also important that you take the time to work out what it is you are selling. Many companies receive gadgets that are not what their customers thought they were and this may well lead to an offer of less money. That said, few ask you to go into huge detail - usually just the make and model is sufficient. "This is one of our advantages over eBay," says Mr Payne. "When people are selling laptops, knowing what you have is not as easy as it may sound, but we only want to know the processor, whether or not the battery works, whether the charger is functioning and any damage the item may have. We ask very few questions."
Even so, there is a temptation to go direct to buyers through eBay. Guy Anker, managing editor of moneysavingexpert.com, says this is actually the best way to maximise the potential of a gadget. By searching for your gadget in the completed listings (under advanced search), you can assess the going rate.
An eBay sale will, Mr Anker says, add between 10- and 20% to the value that even the best recycler will give you. "Half the trick of eBay is knowing when to put it on. Get it right and you may get an extra £30 or £40."
Yet, as he concedes, it is not always that straightforward. As well as having to pay eBay and PayPal fees, there can unfortunately be a few unscrupulous buyers who will try and con you into parting with your handset with a variety of scam: typically wasting your time by trying to persuade you to deal off eBay. It doesn't happen all the time, but the hassle of eBay can make recyclers appear a more attractive proposal.
"They are easier than eBay," says Mr Ankers. "You have to make this call between ease and cash - I will sacrifice a bit of money and go for the eas, but others may take an extra £30, £40 and sell it on eBay."
One of the downsides with online gadget recycling is that the prices are fixed and you only know how much you will get once the item has been tested. Given the slow mailing times, this could be more than a week after you sent it away. Surely, then, the high street recyclers are the best, because you are dealing direct with people rather than through emails and websites? Is there room to haggle?
"It's a personal choice whether you go to the high street or the internet and there is a potential to haggle if you are visiting in person," says Mr Ankers. "But it it didn't work for me personally at CeX and we haven't heard of many of our users haggling successfully. These companies tend to be quite rigid so it's really about what is right for you: internet and jiffy bag, or a store."
Some high street deals are better than you will receive elsewhere. Mobile phone shops, for instance, may give you a decent price on the day a new handset is released as they desperately try and get your custom ("Its a great sales tool," says Mr Mavers. "And it encourages a sale by offsetting the price of a new device"). It is also worth considering accepting vouchers instead of cash. "The voucher is a marketing service that, say, Amazon or Argos will offer to get more customers to their website or store and they can pay around 10% extra," adds Mr Mavers.
Whatever you decide to do, remember that "you're sitting on a cash cow", as Mr Ankers points out. "Companies like Apple are geniuses for making us want the latest phone and as you upgrade, you really want to be selling the old one. Don't let gadgets gather dust unless you want it as a back up or to give as a present. It really is easy money."