By Tim Phillips, Business Development Manager, Techbuyer
If you think that “mend and make do” is a low-tech phrase that best fits your grandmother, think again. “Refurb” is a hot term even with tech giants such as Google. An increasing number of SMEs are picking up on the competitive advantage it offers. Data centres will account for just under 4.8% of the $3.7 trillion spent on IT worldwide in 2018 according to research expert Gartner. This spend could be reduced by up to 80% with a few smart choices on IT infrastructure procurement, leaving more budget to spend on riding the wave of digitalisation and disruptive technologies.
Although the number of small companies adopting the cloud is on the rise according to Cloud Industry Forum, a hybrid solution is still expected to remain the status quo.
This is not surprising given the security concerns many organisations have about business-critical data, particularly when the risks involved in data loss or theft are so high. Another factor is that charges for ingress [delivering the data to the cloud] can be dwarfed by charges for egress [getting it back again] or transfer unless contracts are carefully structured. Finally, there is a time component: transferring large amounts of data over the internet can be prohibitive and can have a huge negative impact on a business.
A capital outlay on data centre equipment like servers, storage and networking will be high if you opt for an all-new system. However, with the current explosive growth of the refurbished market, there is a much smarter option. Like cars, IT equipment drops in value almost as soon as it leaves the production line. A model that is two years old is a fraction of the cost of the latest generation from the factory and will, in most cases, more than meet the needs of IT departments.
Refurbishment companies restore older equipment to factory settings, testing and guaranteeing it before it goes out. The finished product works perfectly, saves up to 80% on the original price, and comes with a three-year warranty. In some cases a lifetime warranty can be offered.
On top of this, refurbishment companies often offer a cash return on decommissioned or redundant equipment, which can go towards other projects or bridging any financial gaps as a result of budget cuts.
Essentially this is a third-party alternative to the in-house refurbishment system that Google has publicised in its report “Circular Economy at Work in Google Data Centres”. In 2015, 75% of components consumed in its spares programme were refurbished inventory and 19% of servers were remanufactured machines.
Google saves hundreds of millions of dollars a year with this approach according to its Lead for Sustainability, Kate Brandt.
That level of saving is significant. When transferred to the much smaller balance sheets, the 80% saving helps businesses stay mobile in the face of coming change as digitalisation takes hold.
National programme iotUK believes SMEs have much to gain from the Internet of Things (IoT), both as the creators of IoT technology and solutions, and as adopters and consumers of the IoT. SMEs are embracing AI more than larger organisations according to a 2017 Adecco study.
All this development means a stack of data moving forward, data that needs to be stored, handled and protected in the most cost-effective way possible. Change brings opportunity, but it also requires making best use of resources without compromising service. This is where refurbished can add significant value.