Squeezing Value out of Old Assets

How Much Money is Sitting in Desk Drawers?

Too often unforeseen value is left sitting in an office drawer. When a reused device is deployed in place of a full cost replacement or redeemed for a lesser value with a mobile device recycling company, the savings can add up. Often, figuring out what to do or how to accomplish reuse doesn’t make the priority list of overburdened telecom administration staffs. The same could be said for assets no longer needed; without a system that accurately identifies asset ownership, the collection process typically lies dormant.

What happens when a device has been lost, stolen or damaged? With an appropriate system in place, a used device is assigned until the line is upgrade eligible, saving $200 to $400 dollars by delaying a new purchase. Where a new device is not required, a similar savings is achieved each time one of these devices is used to fulfill a new activation request. In addition, while older flip phones may not command much value on the reseller marketplace, used smartphones, iPhones, and tablets can be sold to recyclers for $75 – 250.

If your company doesn’t have control of the processes to capture asset reuse savings, following are a few tips to squeeze additional cost savings from your wireless budgets.

Accurate asset tracking – it starts with keeping accurate records of who is in possession of company wireless devices including the Make and Model. This is key to an effective asset reuse program and should be provided as part of any Mobility Managed Solution (MMS) and since confidence in the ownership information is primary, your system should include an effective integration process with Human Resource (HR) information. Because asset information is not part of the monthly invoice, and zero use devices will be candidates for reuse at some point in the asset lifecycle, you will also need supplemental files to update the Make/Model, ESN or IMEI information.

Replacement Identification – a central review point for order fulfillment or an automated online ordering capability that flags broken or lost replacement order requests, which otherwise would not be eligible for an upgrade, is also required. These types of requests would then be fulfilled from an internal supply of like devices, resolving the issue by putting the device back in service until an eligibility upgrade date is reached and a new device can be secured at the lower upgrade cost.

Inventory accumulation – establish a process to collect zero use assets or unneeded assets resulting from upgrades. Without well communicated company policies, this will not happen effectively. If the collection and reuse process is managed within your company, be sure to publish a collection address. If an outside MMS vendor is handling the collection and redistribution, then your ordering system will need to request return labels which will be used to ship the equipment to a central location for handling. To facilitate reuse or recycling, there will need to be an obsolete device list for each Make/Model.

Inventory Preparation – prior to redistributing or to sending devices to a recycling operation, ensure sensitive company information is wiped from the device. For those devices intended for reuse, it may be necessary to upgrade and install specific applications. Additionally, you will need some form of triage to determine which devices are in acceptable condition and those that aren’t considered obsolete.

So how does all of this affect the bottom line? Conservatively, on an annual basis if 4% of devices are lost, damaged or stolen with an estimated replacement cost savings of $250 per device, a company with 2,000 devices would save roughly $20,000 a year. On top of that, if we assume 10% of devices collected from employees who leave the company or who receive an upgrade can be redeemed at an average cost of $75/device by a recycler, it would translates into an additional $15,000/year. With proper planning and processes in place, the ROI on reused assets can be substantial.