1. Cheap labor
One of the most common reason why Chinese phones are cheaper is because of easy availability of labourers at low cost. China has lowest labor costs in the world and this is the main reason why a lot of manufacturers build products there.
China Labor
2. High-tech but not revolutionary
One main factor is that Chines manufacturers don’t do packing of phones with greatest and very latest hardware. They are more focused on balancing the balancing price with performance. If you notice a website selling Chinese phones then you will see smartphones with reasonably high-end specs, but cost a lot less than a Samsung Galaxy S7. Samsung basically uses high quality parts are quite expensive in the market.A lot of Chinese manufacturers use Mediatek processor, these processors are not upto mark as samsung’s Exynos units and are very cheap in price. Cherry on the cake is that Mediatek is a Chinese company so local distributors get all products at very less price.
Chinese manufacturers done don’t use the latest DDR4 RAM and instead use DDR3 modules. Chinese phones have Japanese or Korean display which is very cheap and of low quality as compared to AMOLED or IPS panels.
Chinese manufacturers prefer selling products on e-commerce as it is
the booming technology. Companies like Samsung and Apple have spent it’s
fortune in building their own stores. So basically when you are buying a
Samsung or Apple phone you are not only paying to the company but its
distribution and it the cost of running and maintaining the store.
Chinese phones are cheaper as it is not of one specific brand and does
not have a physical store.
Focus on online sales
4. Cheap marketing
Brands like Oneplus and Xiaomi spends very less on marketing when compared to established phone brands. You won’t find their official stores and service centers rather they sell their smartphones online.Chinese phones company know how to make use of social network marketing in the Internet. We cannot deny that Instagram, Facebook, Twitter, Weibo, etc. are the most popular social networks that has a large number of followers. As a result, the information about the smartphones can be spread widely if they advertise their products here. Meanwhile, some famous brands such as Samsung, Sony or Apple have to spend million dollars on TV advertising, sponsorship, or hiring celebrities to promote their products.
Cheap marketing
5. Produce Limited quantities
The best sale method that works in china is creating the demand for product. It is mentality of people that if a certain product will run of sale, they’re more likely to rush to buy. Xiaomi Mi4 is a China made phone and it was exhausted in just 37 seconds on Flipkart.
Produce Limited quantities
6. R&D(Research and Development)
Tech giants like Apple, Google and Samsung spends crazy amount of money on R&D which is not the case for Chinese phone manufacturers. You won’t find anything new or innovative apart from high specs in Chinese smartphones.
R&D(Research and Development)
7. Low profit margin
Chinese brands get very less profit from the units they sell as compared to world’s most valuable brands like apple and google.
Low profit margin
8. All this is fine, but does product quality suffer?
People used to think that Chinese phones are low on quality but that perception is dead. It is true that China phones are not made of high tech quality but they are also not made of poor quality material.If you are a android user and don’t want to spend much on smartphone then you should give a look at chinese phones.
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