What is the profit margin per minute for a mobile phone?

I keep getting the weak excuse from my mobile provider that they cant let me upgrade my phone at a discount because they have to make up the money they discounted me on my last phone. I always understood the phones as expendable and the plans as the money maker. I need ammo to complain to my mobile provider.|||I know that you want ammo, and unfortunatly I can't give you any. I can help explain why companies only allow discounts every once in a while.


First of all, when you set up service you get a substantial discount on phones. A free phone for example was not given to the cell phone company. Most phones that you get for free will actually cost the cell phone company upwards of $125. Next while you are getting your free phone, someone who works for the company has to help set it up.





Most reps are paid on an hourly basis, and a complete sale can take up to an hour. That rep has to make an hourly rate, and for arguments sake, lets call it $10 per hour.





Now, when you set up service, generally you are in a store, and most cell companies rent their locations. Lets call that amount $2000 per month. Now, since most companies don't do that every hour, your time in the store just cost them aproxametly $15. Next, you have all the other expenses that you have at a home. Heat/AC, water, electricty, and the cost of all the machines that the company has in the store (i.e computers, phones, copiers).





After that, you have to remember that most companies have customer service call centers. Some of these call centers do nothing, but help you. Meaning no income for the company is generated out of these places.





Now it comes to you actually getting a signal on your phone. Cell phone towers, in general, cost upwards of $250,000 per cell site. That doesn't include the land lease, and insurance that they have to pay for for EACH site. Now remember cell towers have a range of 8-12 miles, and if there is a lot of voice traffic on the cell sites they may have to put up more towers in the area.





Now, if the company can't put up a tower in an area, they have to use another companies tower. Most cell companies call these roaming partners. These partners charge you carrier a roaming rate that your company may or may not pass on to you. If you have a national carrier (Cingular or Verizon) they do not pass the extra charge on to you.





Basically, if you figure out the costs associated with setting up one person, the cell companies lose 300-400 per customer that they set up. Now, a cell company will make a lot of that money back up while you are on your plan. But, if you are on a very low plan ($39.99 a month or lower) it will take the company an average up to 16 months to recoup that money.





Now, think about that number if a customer gets a phone that costs the cell phone company more than $125.





Favorite thing that I ever heard at a cell phone store about this very issue.





Customer: I lost my phone, and I want a new one. I am under contract, and I want a free phone.





Rep: Unfortunatly, because you are under contract, you would have to pay full price for a phone.





Customer: (Sounding upset) I've been with this company for x amount of years!!! You should just give me a phone because I've been such a good customer!!





Rep: I've shopped at the same store for the last 9 years, and they won't even give me a free gallon of milk!!!|||- There are various people achieving different percentage of profits according to their status.


- It ranges like Manufacturers, Importers, local stockist, Dealer, etc.


- The profit approximately ranges from 200% to 15%.


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