What do retailers earn for selling a SIM card

[verge]

These days one can buy a SIM card everywhere for very little. I don't the money paid for a SIM card even covers what the cost to the retailer is - especially considering the prominent space at the till point given to SIM cards. Which brings me to my question - how are the retailers rewarded for selling the SIM cards - do they earn a percentage of the airtime sold for the card for a period? I think this is how it used to work when Autopage and the like were selling contracts? I would really appreciate as much detail as possible form a knowledgeable person - around what the typical deal was with Autopage and the like and what the deal is with retailers now

Regards

Chris

 

[Ockie]

Ongoing Revenue is earned.

 

[verge]

Any idea of how much ongoing revenue?

Ongoing Revenue is earned.

Any idea of how much ongoing revenue? How does it differ between prepaid and contract - and how does it differ from what the deal was with Autopage?

 

[FlashSA]

Ongoing Revenue is earned.

Yip, must be something like that. I bought 2x MTN starter packs from PEP months ago and they are hardcoded as Pepcell - I remember the tarrif being PepCell 79c or something.....

Retailer obviously plays the long game and earns crumbs over time to make it worth their while to stock/sell/Rica sim packs

 

[FlashSA]

Any idea of how much ongoing revenue? How does it differ between prepaid and contract - and how does it differ from what the deal was with Autopage?

Autopage and Nashua were getting voice at a discounted rate because of high interconnect fees - Cell C and Telkom Mobile had to pay MTN and Vodacom over a rand per minute to terminate their users' call on the bigger networks - Nashua/Autopage got comm from these interconnect fees.

As ICASA lowered the interconnect fees every year, there was less and less fat for Nashua and Autopage to get a cut - eventually they were making little to nothing on contracts (closer to nothing when bad debts were factored in)

 

[Dairyfarmer]

I worked for a supermarket a few years back, before RICA. The networks supplied the supermarkets SIM cards F.O.C. The supermarket then sold them at R1. Customers then come and buy airtime and the supermarket made a few cents on each airtime voucher sold. At that time there wasn't airtime on the POS system and it was sold as cards. You received a box of vouchers. Once you received them you phoned the network to get them activated. This is when you had to have paid for them. You then held the stock and sold them on. You took the risk. Now you have airtime integrated into the POS. So you only get charged once you sell the airtime.

Agents make their money by way of commission on each contract they sell and what devices they sell. That is why the store staff as not so enthusiastic to serve you unless you are taking out a contract and that contract includes a device. If it is SIM only I prefer to do it over the phone. Don't have to see their sulky faces.