4 ms·

> If you pay $149 to get your iPhone 8 screen replaced, but Apple charges us $135 for the screen, we can't realistically make any money off of that. I mean, ok

> If you pay $149 to get your iPhone 8 screen replaced, but Apple charges us $135 for the screen, we can't realistically make any money off of that. I mean, ok. Doesn't that just mean you aren't charging enough? Is apple charging you a percent of what you charge?

dumbfoundded 7y ago
No, I'm guessing the author is referring to official Apple stores. So in this example, an official Apple store offers a screen replacement for $149. Apple then announces they will sell official parts to independent shops. Apple will then offer an official screen for $135, leaving no room for the independent shop to make money unless the repair shop charges $170 (made-up number for example). The benefit for Apple may be two-fold. Apple will go from having the most ridiculously overpriced repairs to being the cheapest for official parts. Apple may also then justify making it extremely difficult to use non-official parts (as they're already doing). If you're optimistic, you can say Apple is doing this to make the customer experience better to help improve their stagnant phone sales. If you're cynical you can say it's a clever plot to eliminate independent repairs and force people to go to Apple stores.
- Spivak 7y ago
  This seems weird to me because the official parts are better. If Apple was skimping out on their parts and selling them to shops at a huge premium then independent shops would have the advantage because they could repair your phone with higher quality 3rd-party parts for less. I might just not understand the market here but why would I assume that my local repair shop would be able to offer me labor at a cheaper rate than Apple's huge repair system?
  - nulbyte 7y ago
    I generally find third party repair is less in all sorts of cases. I'd sooner take my car to a mechanic I trust than an actual Hyundai shop where they'll tell me every expensive thing needs to be replaced. Just like a car manufacturer, Apple has incentive to inflate the prices, direct and third party, to their benefit and consumer detriment.
  - AnthonyMouse 7y ago
    Customers will prefer Apple-branded parts even if the third party parts are equally high quality. That's the ordinary value of branding -- the well known brand can command a premium for the same quality merchandise. The issue here is that they aren't just charging the normal brand premium for the part, they're also tacking on the same premium again to account for the value of the repair service itself (even though the third party is providing that), and then a little more so that a third party repair service that wants to use Apple-branded parts would have to charge higher prices than Apple's own repair service in order to turn a profit. The intent of the pricing isn't to maximize profits from sales to third party repair shops, it's to make them uncompetitive and push those customers to Apple's own repair services instead. It's basically a way of claiming they're making parts officially available while in practice not doing so, because they're only available at uncompetitive prices.
  - dumbfoundded 7y ago
    Small repair shops are generally cheaper. They can be much more hit and miss too. Also, The aftermarket parts market is competitive.

dumbfoundded 7y ago

No, I'm guessing the author is referring to official Apple stores. So in this example, an official Apple store offers a screen replacement for $149. Apple then announces they will sell official parts to independent shops. Apple will then offer an official screen for $135, leaving no room for the independent shop to make money unless the repair shop charges $170 (made-up number for example). The benefit for Apple may be two-fold. Apple will go from having the most ridiculously overpriced repairs to being the cheapest for official parts. Apple may also then justify making it extremely difficult to use non-official parts (as they're already doing). If you're optimistic, you can say Apple is doing this to make the customer experience better to help improve their stagnant phone sales. If you're cynical you can say it's a clever plot to eliminate independent repairs and force people to go to Apple stores.

Spivak 7y ago
This seems weird to me because the official parts are better. If Apple was skimping out on their parts and selling them to shops at a huge premium then independent shops would have the advantage because they could repair your phone with higher quality 3rd-party parts for less. I might just not understand the market here but why would I assume that my local repair shop would be able to offer me labor at a cheaper rate than Apple's huge repair system?
- nulbyte 7y ago
  I generally find third party repair is less in all sorts of cases. I'd sooner take my car to a mechanic I trust than an actual Hyundai shop where they'll tell me every expensive thing needs to be replaced. Just like a car manufacturer, Apple has incentive to inflate the prices, direct and third party, to their benefit and consumer detriment.
- AnthonyMouse 7y ago
  Customers will prefer Apple-branded parts even if the third party parts are equally high quality. That's the ordinary value of branding -- the well known brand can command a premium for the same quality merchandise. The issue here is that they aren't just charging the normal brand premium for the part, they're also tacking on the same premium again to account for the value of the repair service itself (even though the third party is providing that), and then a little more so that a third party repair service that wants to use Apple-branded parts would have to charge higher prices than Apple's own repair service in order to turn a profit. The intent of the pricing isn't to maximize profits from sales to third party repair shops, it's to make them uncompetitive and push those customers to Apple's own repair services instead. It's basically a way of claiming they're making parts officially available while in practice not doing so, because they're only available at uncompetitive prices.
- dumbfoundded 7y ago
  Small repair shops are generally cheaper. They can be much more hit and miss too. Also, The aftermarket parts market is competitive.