Why Do Companies Purchase Refurbished IT Hardware?

When it comes to purchasing IT hardware for your company, there are many choices on the market. Buying computers, servers and parts that are brand new is an option, but not always necessary. Refurbished products are often available for a fraction of the cost.

When we hear the word “refurbished,” what does that really mean?

What are Refurbished Goods?

Refurbished hardware works just as good as brand-new components. Yes … refurbished can also mean “used;” however, there are varying levels of conditions and the items are not damaged. They are inspected, tested, cleaned, and upgraded. Many refurbished items start out as short-term lease units, manufacturer take outs, moving sales, overstocking, asset recovery, customer returns, canceled orders, or from customers who have changed their mind or reevaluated their business needs.

When a business decides to upgrade its technology—for whatever reason—then what happens to components that are only a year or two old, or have hardly been in operatoin? Refurbishing brings these items to others who are also upgrading their systems. Businesses that sell refurbished items update these components to meet current standards, and the needs of operations. And then, there’s the cost …. No doubt here, refurbished items typically cost less than anything brand new.

Save Money

IT technology is not like buying designer clothes; the fancy brand is secondary to the cost and its usefulness. Now, if the big brand name is there – and that’s what you like – then, all the better! But the bottom line is about getting the best bang for the buck, no matter what size business you are outfitting, and for the items to be long ranging and effective. Refurbished technology might save your business, on average, 40% to 80% compared to buying brand new equipment. The money you save with refurbished items can go a long way toward purchasing other necessary goods, services and security for your operation. With the high cost of doing any kind of business, as well as shrinking budgets, more and more data centers are purchasing refurbished hardware for IT divisions and work centers.

Ecology and Recycling

“Reduce, Reuse and Recycle” is not just a campaign slogan used in everyday life. Cutting back on new components and reusing others will reduce the carbon footprint we all leave on our planet Earth. Reusing and revitalizing old computers, components, bits and pieces are lessening the need for more landfill space and dumping grounds. Raw, natural materials are taking less of a hit when consumers recycle old parts into new, useful items. Refurbishing helps create a sustainable environment. What’s more, it may cut down on electricity usage and costs.

The Difference Between Used and “Recertified”

Here are some notations to keep in mind when comparing items available by sellers in the marketplace.

• Recertified items, also sometimes referred to “authorized refurbished,” “certified refurbished,” or other similar term, undergo a strict regimen of evaluation done by a third party, not the original manufacturer. Items are evaluated, cleaned, tested and updated (if any of its features have changed after the unit was first built). These upgrades may include changes to the item’s operating system, along with microcode, firmware, drivers and patches. Drivers, for example, are sometimes needed for specific ports, motherboard cards, and components. Patches are upgraded to repair bugs in constantly-changing software codes that improve the security of a program. Patches are especially noted on recertified products.

Recertified products are particularly recommended for all customers. The features are updated, and have been tested, cleaned and certified. Certified items are usually under some type of warranty as well (check with your supplier for details).

• Used components may or may not have undergone all tests and upgrades. Components sold “as is” or marked “used” are typically items that have been placed on sales shelves (or online). Depending on what the repurposed packaging says, these pieces may have been tested for basic functionality, but not upgraded. Original microcode and firmware is in effect, and items were never cleaned or maintained. The equipment could be outdated for its intended purpose. Used products are not recommended by IT resale businesses and they are not always under warranty when found in secondary markets.

Buying notably “used” products can save the consumer a bundle in the short run, because the costs are often much lower than new items. Units that are at least five years old may no longer be manufactured, and, thus, sell cheaply. However, these items may be outdated as technology continues to advance. Still, there are reasons to consider used components; part scavenging and simplicity of basic units are among the benefits.

Comparing the Costs and Benefits

Now that you understand what “refurbished” really is, you can more easily compare its benefits to those of purchasing new, factory sealed products. When deciding the best course of action to take for technology upgrades in your small, medium, or large business operation, check out each option carefully and talk about your needs with a qualified sales agent.

IT Xchange provides value added resellers of IT hardware around the globe with PC and server technology that helps their customers save more while also increasing their margins. Contact us to learn more.