Wednesday, 18 March 2015

Mine is Bigger than yours!

Size matters. In terms of IT recycling if you are a really big business you are constantly going to be refreshing assets, so you will have the necessary partnerships, build the internal knowledge and have a good idea about what you want and need to do. Hopefully. Not always the case but in my experience the best businesses ‘have a plan’.

This makes a sense to me. I spoke to one customer this week about their plan, and it was quite revealing. They budget for asset disposal and look to enhance that budget by selling on their kit through us.

The thing that really struck me was the level of realism. They knew they were not giving us anything with great residual value but it was our ability to squeeze every last drop out of assets that made us an important part of the equation.

Take laptops. They dispose of 200 at a time and although they are usually beaten to within an inch of their lives, matching sets like that retain value to some people in the market. Maybe only £15 per laptop but for 200 that is £3,000 and that paid for the collection and data wiping of the laptops and two full van loads of assorted WEEE (Better described as waste in this case).

Our client has 3 priorities – data security, responsible disposal and the right paperwork. When you are running an IT system that covers the globe and several thousand users you need to be organised and keep detailed records, and you need to comply with all regulations. He is fully onboard with my first principle of managing risk.

The really refreshing part of this was the realism about what we actually do. For a start, collecting 2 full van loads of stuff is not easy or cheap. 3 guys were gone for eleven hours door to door. It then took another three hours to unload and track it all in, because it had to be secure before we shut up for the night of course. Then the data erasure of some 300 machines begins. And the paperwork starts churning out waste transfer notes and asset lists. We then have to think about PAT testing everything and finding a buyer. Do we have to clean, repair, reload software?

Doing all that for free is simply not possible. We agreed with our client on a collection fee, data charges and a revenue share going forwards. He is in no hurry for the money. They are a world class multi-national business and a couple of grand would not cover the mineral water bill in their conference rooms around the globe, but at the end of the year his budget still has to hang together and hit the right figure, and that is when the bottom line matters.

On a smaller scale, I can see how this stuff gets difficult. Let’s run the scenario again making it 20 laptops, not £200. That is £300 resale value, of which the company share is £150 at best. Not really a lot to play with. We still have to send the van out and let’s say same distance but half the time. As long as I could match the collection up with others and fill the van that way and it was not way off the beaten track, collection and data erasure would be between £150 and £200.

But you do have to remember that this really is waste. Your people have beaten this kit into the ground and got every penny of life out of it. If you refreshed more regularly decent laptops can get £100-200 each depending on the specification and age. But you don't, do you?

Hence, smaller disposals seem to cost more. And of course most businesses are smaller. They do not do this stuff all the time, and therefore they do not necessarily have a plan. They are often not realistic about what it is all going to cost. They may not appreciate the risks they have to manage.

And yet no business can afford to take this stuff less than seriously. Those three overriding principles remain the same, data security, sustainability and value for money. The smaller you are maybe the third seems hardest to achieve, but we will work with you to help.

And big or small, the fine is still £500k.