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Apple Stops Accepting Returns and Exchanges in Hong Kong Ahead of New iPhones

vertical smile said:
I think that Hong Kong is treated as a separate nation from China, economically speaking. After Hong Kong was given back to China from the British, China left many parts of it as it was under British control. That is one reason it is still very westernized.

Anyways, I could be wrong though.
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While true, that's nothing to do with the point he made about people in mainland china paying import taxes on products ostensibly made in mainland china. ;)
 
nicho said:
While true, that's nothing to do with the point he made about people in mainland china paying import taxes on products ostensibly made in mainland china. ;)
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Oh, I guess I misunderstood.

While the iPhone is assembled in China, the parts come from all over the world. But, I suspect that even if all the parts were from China, they would still pay an import tax. IDK.
 
Why? WHY?

I don't understand why this smuggler's market even exists.

What are people doing with these devices that they cannot do using something else???

The Apple RDF is truly an amazing thing.
 
Just to be clear, this guy straps 94 iPhones to his torso and legs, shuffles towards the exit door like he is carrying a bomb, and does not expect metal detectors to go off?
 
If those were Galaxy Note 7s strapped to his body, he would be deemed a suicide bomber! "Flame On!!"
 
Price fixing by Apple itself, sales tax, and generally high demand means an iPhone when newly released, is often in very low supply within Mainland China white market. Then Hong Kong being literally a river across South China, having no sales tax, lower Apple price and lower exchange rate to USD means there is significant profit to be made for smugglers.

This article touches on a related issue, ever since the iPhone 4, every time a new iPhone launch would create massive demand also on the Hong Kong side, mostly by the smuggler and parties related. With a one-person-one-unit purchase policy in place, many (poor) people just buy from Apple legitimately, sell them to grey market aggregator within Hong Kong, usually some shady shops in Kowloon, or lately these guys just horde right outside an Apple Store. These people gather enough units and then would "ship" those phones in bulk, crossing the border via various means, including the captioned image which I believe is one of the less clever routes. Anyway with every one of these guys caught, there may be 99 others let through, intentionally or not.

The change to no return policy is to stop new phone hoarders from returning the phones without actually being a user. What often happens is when the grey market spikes up quickly but also falls back down quickly, when it reaches a point where profits cannot be made (grey market price meeting Mainland China MSRP) then the hoarders can return all the phones under the old policy.

Another much more complex issue is modders. The city where most electronics are made/assembled, including the iPhone, is Shenzhen just next to Hong Kong. There are people skillful enough to have 90% of actual electronic guts swapped out of an iPhone, just keeping scrapped battery and motherboard to boot up a white logo screen and stay there. Apple Store employees have no means to verify if it is a legit return or as they refer to a "lego'd phone".

The whole iPhone situation between Hong Kong and China can be written into a Economics text book. Some believe that the original iPhone 4 epic grey market price (10k+ USD per iPhone 4 at one point) helped Apple to launch itself to where it is today within Mainland China, with how much publicity that gave the brand.
 
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gregorynacu said:
When I first saw the pics, hadn't read the title yet, I thought he was a suicide bomber. When I finally found out that he's just a dude stealing and selling iPhones on the blackmarket, I was truly relieved. I guess everything's a matter of perspective.
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The guy wasn't stealing iphones...he bought the iphones in Hong Kong to resale in China for almost 100% profit.
 
Chancha said:
The change to no return policy is to stop new phone hoarders from returning the phones without actually being a user. What often happens is when the grey market spikes up quickly but also falls back down quickly, when it reaches a point where profits cannot be made (grey market price meeting Mainland China MSRP) then the hoarders can return all the phones under the old policy.

Another much more complex issue is modders. The city where most electronics are made/assembled, including the iPhone, is Shenzhen just next to Hong Kong. There are people skillful enough to have 90% of actual electronic guts swapped out of an iPhone, just keeping scrapped battery and motherboard to boot up a white logo screen and stay there. Apple Store employees have no means to verify if it is a legit return or as they refer to a "lego'd phone".
Click to expand...

Thanks for this, excellent post - I was trying to work out what the no returns policy was actually for. Makes sense now.
 
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melendezest said:
Why? WHY?

I don't understand why this smuggler's market even exists.

What are people doing with these devices that they cannot do using something else???

The Apple RDF is truly an amazing thing.
Click to expand...

Chancha's comment basically summarized the whole reason why this "market" even exists. But an easier explanation is, this is because of the currency exchange rate of RMB and HKD allows them to make a profit from reselling. Thus since iPhones sold in Hong Kong are unlocked international models, they don't have the tweaks and SIM lock they get from the devices available in China, hence creates a demand.

But to be honest, iPhone is not the only thing that has a market for in Hong Kong.
(Yes, and I'm sort of ashamed to have to admit this. lol)
 
Chancha said:
Price fixing by Apple itself, sales tax, and generally high demand means an iPhone when newly released, is often in very low supply within Mainland China white market. Then Hong Kong being literally a river across South China, having no sales tax, lower Apple price and lower exchange rate to USD means there is significant profit to be made for smugglers.

This article touches on a related issue, ever since the iPhone 4, every time a new iPhone launch would create massive demand also on the Hong Kong side, mostly by the smuggler and parties related. With a one-person-one-unit purchase policy in place, many (poor) people just buy from Apple legitimately, sell them to grey market aggregator within Hong Kong, usually some shady shops in Kowloon, or lately these guys just horde right outside an Apple Store. These people gather enough units and then would "ship" those phones in bulk, crossing the border via various means, including the captioned image which I believe is one of the less clever routes. Anyway with every one of these guys caught, there may be 99 others let through, intentionally or not.

The change to no return policy is to stop new phone hoarders from returning the phones without actually being a user. What often happens is when the grey market spikes up quickly but also falls back down quickly, when it reaches a point where profits cannot be made (grey market price meeting Mainland China MSRP) then the hoarders can return all the phones under the old policy.

Another much more complex issue is modders. The city where most electronics are made/assembled, including the iPhone, is Shenzhen just next to Hong Kong. There are people skillful enough to have 90% of actual electronic guts swapped out of an iPhone, just keeping scrapped battery and motherboard to boot up a white logo screen and stay there. Apple Store employees have no means to verify if it is a legit return or as they refer to a "lego'd phone".

The whole iPhone situation between Hong Kong and China can be written into a Economics text book. Some believe that the original iPhone 4 epic grey market price (10k+ USD per iPhone 4 at one point) helped Apple to launch itself to where it is today within Mainland China, with how much publicity that gave the brand.
Click to expand...

Excellent answer, thank you.
I am traveling to HK, from USA, in November; my first visit. Is there anything worth buying (for myself or family) in HK that would be a better deal/cheaper than buying it here in US? I'm asking about iPhones, photography gear, and pretty much anything. Thanks.
 
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