Network Hardware Resale Making Pre-Owned Equipment Look Good

Much like those who may be reluctant to buy used cars, there are many out there who are wary of buying pre-owned, used and refurbished networking equipment that is offered by a company like Network Hardware Resale (News - Alert). Ironically enough, those companies are Network Hardware Resale’s favorites.

“Either customers have bought pre-owned before and say we are better than others or they have no idea the market existed,” Michael W. Lodato, senior vice president of sales and marketing for Network Hardware Resale told TMCnet at Interop (News - Alert) 2011 in New York City Wednesday. “The third is they have a preconceived notion against us and pre-owned equipment, and the third one is actually our favorite conversation. We built our entire business around mitigating those concerns.”

“We walk them through everything we do,” he added. “If we can get them to our facility and walk them around our factory and show them what we are doing with the equipment we own them for life.”

Network Hardware Resale is the world’s largest provider of used Cisco (News - Alert) equipment, with more than 10,000 organizations in the world relying on the company. Network Hardware Resale prides itself on reselling network equipment and 80 percent of that is Cisco.

Among the many things that sets the company apart is the fact that it can stock inventory. For example, if you need a replacement part, Network Hardware Resale can have it out to you within hours. Conversely, when dealing with Cisco, the lead time is usually three to six weeks, according to Lodato.

But just how good is the pre-owned equipment? Better than the new version, Lodato said.

“We test the heck out of it and warranty it so we are going to get it to you faster, it’s going to be higher quality and a lot cheaper,” he said. “Ninety percent of equipment failures happen in the first 60 days of use and those are because of manufacturing or distribution errors. If someone has used that, they flush out those problems so pre-owned equipment has a natural advantage in working.”

Network Hardware Resale acquires used equipment in three ways: buying Cisco off of failing companies, acquiring equipment from companies that have a surplus, and gaining equipment when others upgrade their equipment. 

While the company has been in the industry for 25 years, it is experiencing its biggest growth spurt now, particularly because of the economic downturn.

“Every time there’s tragedy and the economy crashes, a bunch of companies go out of business so they sell it to us for pennies on the dollars and everyone else becomes cost conscious so they start considering pre-owned equipment,” Lodato said.

And the companies that do decide to go with Network Hardware Resale’s equipment are seldom disappointed.

“Customers will say ‘You are the relief out there,’” Lodato said.

Others are picking up on Network Hardware Resale’s success and analysts like Gartner and IDC (News - Alert) are looking at the company and asking questions, according to Lodato.

In an effort to remain on top of the space, Network Hardware Resale announced this week at Interop that it has enhanced its whole offering by adding monitoring to its support contracts. The company will monitor entire networks and do proactive provisioning meaning if it sees something struggling it will have a replacement sent to you before you know there is a problem.

“We are going to see some huge transactions coming up,” Lodato said.