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Pre-owned hardware is any equipment which is not sold as new directly from the manufacturer or channel partners. Many vendors, companies and auctions use varying terminology, including “re-certified”, “used”, “refurbished”, “new-in-box”, “new-open-box”, “A+ Certified Pre-Owned™”, “the secondary market”. While they are often used interchangeably, many factors dictate what exactly is being sold, and the common adage applies - “buyer beware”.
Yet, an incredible array of organizations from both the public and private sector are buying pre-owned. These organizations include global public commercial enterprises, small businesses, ISP’s, telecoms, non-profits, local and US government, military and educational institutions of all kinds.
Although many manufacturers have down played the market’s growth, tremendous demand has given rise to nearly a three billion dollar market, with thousands of sellers, companies and eBayers. Finding a reliable vendor can be a daunting task for any network administrator looking to reduce costs.
This uncertainty and lack of knowledge is exactly what led us to create a small FAQ back in 2000, when the market was in its infancy. Since then, our guide has seen eight revisions and over 50,000 downloads.
An overwhelming majority of the customers we’ve surveyed mention the same fact - they just didn’t know pre-owned was a real, safe and viable option. Significantly lowering networking costs seemed like an unattainable goal, until they discovered the pre-owned market through research and experimentation.
In this guide, we’ll present you with critical information you need to make the switch, become a pre-owned evangelist and start saving instantly.
Trade-in programs & network upgrades
Companies of all sizes continuously upgrade and de-install network infrastructure to meet the changing needs of their customers, employees and suppliers. Manufacturer trade in programs are often inadequate and offer customers little financial incentive for prolonging their hardware’s lifespan. Thus, millions of dollars of useful network hardware enters the secondary market annually.
Off-lease equipment
Equipment leases typically range from one to three years, leaving the lessor with functioning hardware well before the end of lifespan.
Excess inventory
Distributors, enterprise, government and military institutions purchase large quantities of equipment in bulk. Their inventory often exceeds their needs, resulting in warehouses worth of unused equipment. This was evident during the dot com bubble, when CIO’s flush with venture capital cash irresponsibly stocked up in massive quantities. While network managers today attempt to manage spare inventory thriftily, spares for redundancy and disaster recovery is still an executive priority. This leads to the annual sale of huge lots of unused equipment simply because upgrades precede their use.
Auctions and liquidations
A tremendous surplus of new and pre-owned equipment emerges from companies burnt in bankruptcy, such as Bear Sterns, Enron and Global Crossing Ltd. Businesses undergoing mergers, acquisitions, relocations and downsizing also result in large quantities of unnecessary equipment. These are sold in volume at high discount to the secondary market.
While the terminology for pre-owned varies from seller to seller, the important factors to consider are not the seller’s choice of words, but rather their reputation, experience, processes and policies.
When considering a seller, ask these questions ...
regarding credibility :
· Is the seller’s online presence professionally designed & developed?
· Is online business conducted securely (SSL certificates, 3rd party certifications)?
· Are phone numbers, email addresses, and a physical address displayed?
· What customer references are provided?
· What processes are in place to avoid counterfeit goods?
· What is the financial condition of the business?
· Is the seller’s customer base local, regional or international?
· How long is the seller in business?
regarding product quality :
- What is the origin of the equipment?
- How are products tested and re-certified?
· Does the seller guarantee genuine equipment?
regarding level of service & support :
· What type of warranty options are available?
· What happens in the event of a part failure?
· What is the turnaround time for a replacement?
· What pre and post-sales support options are available?
regarding technical knowledge :
· Are certified Cisco engineers available in-house?
· Is the seller an active voice in the industry, publishing content via blogs, articles and
guides?
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