Historically popular in Cambodia, second-hand mobile phone shops are becoming less attractive to consumers because of increasing competition in the marketplace, according to shop owners in Phnom Penh.
With hundreds of stalls located inside the Mongdial Center, Phar Klaing Romsev is a popular place for upgrading phones in order to stay up to date with newer phones with more features and lower prices.
Hong Dimo, a 52-year-old, second-hand phone seller at Khlaing Romsev market, said that the place was quieter than four years ago when he started his business.
He said that back in 2008, phone shops hadn’t existed even at nearby Stung Meanchey market, about two kilometers from the Klaing Romsev market, but recently, that site was now home to many cheap phones shops.
“It is so different. Before there were crowds of people coming here, but now, it is so quiet,” he said, adding that “It results from lots of newly established phone shops close to customers’ homes.”
He added that even along the streets, and at many other markets, the phone shops have sprung up, adding to the drain on the number of customers.
“This is now common; everywhere there are phone shops,” he said.
Originally a taxi driver based at Phnom Penh International Airport, Dimo started his phone shop at Klaing Romsev to work with his wife who had given up her business selling textiles, and claimed that the business was not nearly as good as when he started.
“In general, this market is the biggest market in Phnom Penh for selling second-hand phones,” he said, adding, “as you know, you can find everything here.”
Because of the increased competition amongst sellers, and the importation of cheap Chinese phones, leading to a decrease of customers, particularly garment workers, Dimo is looking for new business because of his fall in revenue.
“Income dropped by about half. I want to change as well and I am looking for new business,” he said, adding that “I am not clear yet what I am going to be because other business need capital as well.”
“When I started at first, I could make US$1,000 profits for some months. But my profit has dropped gradually to about half of that recently,” he said, adding, “I am not exactly clear how much it dropped, but I know it dropped about half.”
He said that each month now the business took in some $7,000 or $8,000, with profits of about $300 to $400.
He said that young people most commonly came to exchange phones or sell them for upgrading to newer models, but garment workers had stopped coming because of phone shops nearer their locations.
“Previously, when workers got their salary, they came here to buy their phones,” he said, adding “now they don’t come here, while there are so many shops close to their work.”
Kin Pheap, who rents a stall at Klaing Romsev market, agreed, and said that now he could sell two or three units and just break even, while three or four years ago, he was able to earn much more daily.
“Some phones we bought for $40 and we hope to sell $50 or $60, but now we can only sell for $20,” he said of the recent situation, with customers being offered a vast range of cheap phones.
He said “we make profits with new series, but we lose profits with the old models. I don’t dare to buy old models for customers, except regular customers who come to exchange newer ones.”
Importing Chinese phones which workers can afford to use is the main factor to change in the phone market has over 700 shops excluding outside establishments.
“Now Chinese phones sell lots, and phone shops are everywhere,” he said, adding, “before, garment workers came in crowds on the weekends.”
Mr. Pheap said that he has run his phone shop at Khlaing Romsev for over 10 years when business was good and he made good profits.
He said that before the economic crisis, when land prices were still high, many people came to change their phones and update models: “at that time, I could earn between $50 and $60 per day, while recently, there have been no regularity.”
“Sometime, I can earn and sometime I cannot earn at all,” he said.