Cellular telephone reuse: The ReCellular Inc. case

Founded in 1991 in Ann Arbor, Michigan, by Charles Newman, ReCellular Inc., further denoted by ReCellular, is one of the leading traders of used and remanufactured cellular telephones, further denoted as cell phones. In the initial days of inception, when cell phones were an expensive consumer product (average prices were $3000), Newman leased cell phones as an alternative to buying. In the following years, it became increasingly clear that there was a distinct market for used and remanufactured cell phones, provided the product had an acceptable level of quality. Charles Newman sensed an opportunity in this emerging trend and decided to enter the remanufactured cell phones market. The company's wide range of remanufactured product offerings at high levels of quality and at attractive prices soon created a huge market. By 2000, ReCellular had remanufactured over 1.3 million cell phones of all makes and technologies and had operations around the globe including South America, the Far East, Western Europe, Africa, the Middle East, and North America. The company had ambitious plans of increasing its geographic reach. As Newman put it, "We want to be the 'first in the second' wireless exchange business." Specific data on the efficiency of the reuse systems (i.e. how much of the new cellular telephones sold were reused in one form or another) was not readily available. However, industry experts believe that remanufactured and reused as-is cellular phones made up at least 5-8% of the total worldwide market.