Have you ever wondered what the difference is between AT&T, Verizon, T-Mobile, Sprint, etc. stores at your local mall? I’ve traveled the country and understand that some markets are not that saturated with maybe only 1 cell phone store per carrier (or less) in each mall, but for the most part there are usually at least 2, I’ve seen as many as 8, of the same carrier in the same mall!
Why would any trader do such a thing? Why does a kiosk, cart or online store have different offers? What is the difference between this AT&T store and that one, between this Verizon store and that one, etc.?
I will help answer what is the difference between a corporate owned cell phone store and a licensed cell phone store.
Difference #1 – There are two types of retail stores. One is the actual company store, which is owned and operated by the trucking company and employees. The second is an authorized retailer or distributor that is a separate business entity from the actual carrier. At the same time, the authorized retailer (reseller) is approved by the carrier itself to sell its services and products.
Difference #2 – Phone #1 is $100 at this store vs. $50 at this store. Corporate-owned stores for the most part are consistent across the board with phone prices and plans. At the same time, authorized retailers can change prices within the limits of their agreement with the carrier and company P&L as makes sense. You can often find better deals at authorized retail stores, but the same can be said for carrier-owned stores.
Difference #3 – No secondary contract vs. secondary contract? What is a secondary contract? A secondary contract is a contract used by most authorized retailers to help determine and secure the discount they have passed on to the customer. Example: A phone that retails for $100 will likely cost the retailer between $50 and $200 more than the selling price. Believe it or not, it’s true. On average, it could cost the retailer $100 more than the retail price. This is where the secondary contract comes in. If the consumer cancels his service with the operator before the minimum days necessary (consolidation period) for the company to obtain its commission from the operator, he would lose not only the commission from the operator, but also the cost of the phone. Should this scare the consumer away from buying from an authorized retailer? In my opinion, NO. The only reason it should scare the consumer is if they plan to cancel their service and not return the phone within the grace period given.
Are corporate stores better trained than authorized retailers? In my experience, it depends on the actual store and the employees. I’ve seen it go both ways.
In theory, both carrier-operated stores and licensed retailers co-exist and should respect each other. In practice, I’ve seen it friendly and downright fierce between the two of them. So if you happen to be shopping around and visiting corporate and authorized dealers, be sure to go with your gut and buy from whoever you feel most comfortable with.
Key thought when buying: Buy from the seller who rates you best. That is, it asks you the right questions to help you fit in the right plan and phone. If they don’t ask you the basic questions…keep shopping!
I hope this article helps you.