Phone-repair

Smartphone Repair Costs: Explained

By Team Servify on Saturday, July 1st, 2017

How can repairs for smartphones sometimes cost more than the product itself? If you’re pondering about this questions, then you’ve come to the right place. We at Servify want to enlighten our users about this topic, so let’s look at why such a situation exists in the first place.

Liquid damage voids warranty

Once any smartphone is exposed to liquid damage, there is generally no way of saying how much of that liquid will affect the internal components. Which is why most brands label that product as void of manufacturer’s warranty. However, an Authorised Service Centre of any smartphone brand is the ideal judge of potential damage that can be caused by such accidents. In some cases, if the liquid has managed to seep in and caused extensive damage, the only option left is to replace every affected component.

Leaving any part un-replaced might lead to corrosion or short circuit and that will lead to more problems in the future. This is not an experience that most smartphone brand, and definitely not Servify, wants its customers to have.

Genuine parts versus local parts

An Authorised Service Centre is supposed to use genuine parts made/supplied by the brand. This also means that when compared to ‘local repair shops’, the repair at an Authorised Service Centre might feel more expensive. But that’s not because they are cheating you, it’s because the parts themselves are genuine and usually more expensive than local parts that have no warranties. Let’s explore why these parts costs more.

Import duty costs escalate prices further

The cost of sum of parts is always more than the product itself. This is not only true for smartphones but also cars and a host of other tech products. Why? Let’s look specifically at smartphones. The import duty cost for a product like a smartphone is ~18%, whereas parts imported for manufacturing in India as part of Make in India campaign attract only a 2% import duty. But, these imported parts can never be used for repairs and brands will be held in non-compliance if they do that. So how much import duty do brands have to pay for components needed for repairs? It’s generally double! (At least 28% and above)

Please Note: These import duty charges will change once GST is implemented in India.

That, in itself, is a dead giveaway on why the costs are high when repairing a smartphone. When a phone is assembled (most times in China), the parts are available locally and even if smaller components need to be shipped, the cost is offset since the orders are in bulk. Any smartphone brand will produce thousands (if not millions) of phones in one go, in their factory. But, from the factory, only a fully assembled phone reaches different countries.

Thus, if any part inside the phone needs to be replaced, it is generally imported from the country of manufacturing. In most cases, this is China. Add import duty costs to shipping to labour & handling charges and you can see why it costs a lot more than the original phone itself.

Servify’s platform aimed at transparency

So what is Servify’s role in all this? Firstly, our platform is aimed at making the entire process of repairs as transparent as possible. Service requests are raised via our app (or web) and based on the assessment of Authorised Service Centres, and the same estimate is shown to the user without any manual intervention. Just like Uber and Ola leveraged technology to provide transparency, we aim to do the same when there is a repair need for our consumers.

Secondly, we agree that costs can unfortunately be very high, sometimes for no good reason. But, we’ve already covered the causes for this. However, with our deep integration to this ecosystem, we are hoping that we can bring sanity to this complex issue benefitting customers in general. Whether it is the customer or the insurer (if the product is covered by an insurance program) our aim is to bring down the cost of repairs by working with every player in the ecosystem. And we hope we will be successful in this endeavour.