Secondary equipment market heats up

In every recession, consumers – individual and corporate – are more cautious about spending and tend to look for bargains under every rock. The current recession is no exception, but there’s a new twist this time.

Thanks to the massive amounts of hardware that got devoured during the late 1990s and the subsequent failure of many asset-bloated dot-coms, there’s a new way for CIOs to get good stuff cheap. The secondary market for information technology has ballooned into a force to be reckoned with.

Seventy-seven per cent of IS executives recently surveyed by CIOU.S. are purchasing secondary market equipment, and 46 per cent expect to increase their spending in that area next year by some 15 per cent.

“There is so much used hardware available now – and so much emphasis on cutting costs – that the secondary market is no longer a niche business,” writes Scott Berinato in Good Stuff Cheap. And experts argue that this market is here to stay, at least for a while.

A lot of the equipment finding its way into this market has a pretty long shelf life and there’s enough of it out there to support the secondary market for years. One sign that this is more than just a blip is the number of service organizations emerging to make it easier for IT buyers to get what they need without getting taken.

Smart vendors are learning to live with – and participate in – this new reality. After going to the trouble of learning the ins and outs of this complex market, the 77 percent of CIOs who have already tried this out are not likely to go back to buying retail if they don’t have to.