Most of these
computers are sourced from big companies who change their computers every 2 to
3 years to keep up with technology. They basically lease a laptop as you would
lease a car. Why you may ask? For a big company with over 5,000 laptop users
this would mean a heavy capital outlay which they may or may not be able to
claim back all the VAT on depending on the country of operation tax rules. Most
of them would like to have good profits and the best way to do it is by
expensing the computer costs; the only way to do it is by leasing a laptop for
2 years. 2 years down the line the computer goes back to the owner and the
company gets new ones. Obviously they don’t change the computers all at once
but rather on a continuous flow.
The owner of the
computer would have recouped all the costs of the computer from the lease payments
and will have no real profitable use of the used computers. After all,
technology has moved on in the western world. They however know that poor
African cannot afford the new computers and this is their secondary market
where they make a few more coins out of the already used computers. They really
don’t have to refurbish them, but their main client wouldn’t like their
information all over Africa. So they would need to change the client specific
hardware and ensure that there is no software and data on the computers before
they ship them over. At this stage, the computer costs £65 each which amounts
to 9,000 shilling or so depending on the foreign exchange rate. So how come the
refurbished computers in Nairobi are going for 30,000 shillings? Surely taxes
and shipping is not that much, or is it? This is a high profit margin business and with social media it turns out that you dont need a shop front to do it.....
Hi.The reason why it would be impossible to make money from the refurbished computers is that when importing it to Kenya,you now have to pay 25% Excise tax + 2025% ICF.This would more than triple your initial cost of purchase.Then there is the matter of shipping costs
ReplyDeleteThe cost of a new computer is relatively cheaper compared with a refurbished one in Kenya because of the duty added to it by the government to discourage people from buying second hand computers which are in turn attracting "E-waste dumping" into our country. Therefore, the people selling second hand computers need to rethink their business model a little bit.
ReplyDeleteI agree. But the taxing is official business. Try importing using Somalis........
DeleteIt's true that refurbished computers are sold at a higher cost and the reality is that they have been used over time the best thing to do is to purchase a new computer for the same price but with new technology instead. We at Shopit are pleased to inform you that you are sure to enjoy shopping for tech products like computers, software, electronics, mobile and tablets. We are becoming the most loved and trusted market place since we offer superior shopping experience, rapid delivery and the best customer service as we do also deliver the products you need from any company of your choice that you trust. Feel free to check out our website http://shopit.co.ke for more on the products and services that we offer.
ReplyDeleteBut there are hundreds of people who sell refurbished laptops, desktops, and screens at cheap prices.
ReplyDeleteHow do they earn profit? I suppose they cannot run their businesses at a loss. (publisher at www.laptopanalyst.com )