Gray Market Will Give Cisco Blues — GigaOM — My Tips for Second Hand Success.
December 8, 2008 by Greg Ferro · 5 Comments
Gigaom says Cisco second hand market will grow — huh — well of course it will. Here are my tips for doing it.
Gray Market Will Give Cisco & Dell The Blues — GigaOM
If you haven’t been buying Cisco second hand from authorised and reputable suppliers then you are stupid. Really, electronics doesn’t wear out, it just loses meaning (performance, features, imcompatible with some other new piece of kit.
Here are my tips for recycling success:
- look carefully for suppliers of second hand units that can be put under Cisco maintenance. (Yes Virginia, it can be done).
- if you are using reseller maintenance (sigh), check that they will put the second hand gear under maintenance. If not, get the reseller to sell you second hand equipment, many do, they just don’t like it because it is hard work for them and less profitable (and not to mention that Cisco takes a negative view of resellers doing this). Be patient but firm with the reseller, and be ready to change if necessary.
- Expect to have supply problems. You can only buy what is available, sometimes stock runs out before your purchase order can get there. PLAN FOR THIS. Think about your options.
- don’t expect to buy latest gear, you will get a Supervisor III for your 6500 but less likely to find Sup720. Set your expectations low, do the research to understand what features are missing from older kit and software — after all, its a recession you haven’t got anything else to do.
- get ready to be surprised about how little you are not getting. I am often surprised about how well it all works out.
- test, test, test — but you were doing that anyway .….weren’t you? Add some time for soak testing.
- be smart and buy some spares. You are already saving a shed-load of money, don’t be stupidly tightfisted and buy spare parts. Then you can rotate parts in case of intermittent problems. You can always return what doesn’t work.
- be really smart, and pick the moment to buy new. It is one thing to buy five year old 3640 routers for the branch office in the Orkney Islands, but buying SupII / C6500 for your new strategic data centre relocation might not be such great value.
Try to form a relationship with your second hand supplier, if you work with them, they will help you right back. You can only buy what someone has sent to them, so your second hand people can sometimes re-queue equipment to good customers.
I have followed these concepts for a while now, when the opportunity is the right one. Sometimes having the right module is more important than having a new module.
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Well I must say that the company I currently worked for started out with a network built out of entirely second hand Cisco gear supplied by Mr E Bay and some local box scroungers. It worked well for us.
We use new for the core (not cisco though) now days though.
Your second-hand supplier should verify where they get their supply, and to echo Greg’s wise words, you must be absolutely certain you can get maintenance coverage from Cisco for the gear, if that’s important to you. One of our business units bought a pallet of second-hand 3750s, only to have several fail. Cisco wouldn’t touch them, as they were registered to a different company on another continent. IOW, you can get SCREWED in the gray market if you are not careful about who you’re doing business with. Saving money has its downsides if you don’t do your homework.
Just keep in mind that buying cheap, used, recycled network gear for your company’s network also, in a way, diminishes your value as well. While finding a way to save the business some bucks is always a good thing, in the long run, your value is also linked to the value of the equipment you are responsible for. By not selling the value of a high quality network to the business initiatives, your career slowly morphs into that of a modern day plumber, rather than an Architect who enables the business with technology.
My .02
Cheers,
Brad
Brad
I assume that it is in your interest to sell Cisco products, and that is fair enough because it likely pays your salary.
For many people, it is a primary concern to ensure that money is spent on services. That is, paying for engineers to do the installation — because that is when WE get a salary. Right now, I find it more important to make sure my company and my position is secure — therefore I will choose to use second hand equipment where it makes sense to save money and make my budget go further.
In my opinion, this doesn’t makes my position lesser, since I delivering the best solution. In fact, I am being rewarded for doing what is right for the customer. Its the solution that matters, not the product.
Making money for Cisco is simply not a consideration in delivering the best solution. Not now, and not ever.
Greg
Greg,
I understand your motivation to shift the opportunity wallet share from product to services, which in part motivated this post, I’m guessing.
Yes, I am motivated to increase new product wallet share, but not to shift it away from services. I always encourage customers to spend money on services with smart guys like you because in the end it results in higher rates of customer satisfaction — which by the way I also pays my salary (meeting customer sat targets).
The product is part and parcel of the solution. Having high quality network gear power the solution makes the solution better for the customer in a number of ways. Installing used, recycled network gear is not in the best interest of the customer if the solution has any meaningful value to the business. And if guys like you, me, and our respective customers are not tying our value to the business value — we are all in trouble, no matter what side of the fence we work on.
A good solution for the customer involves high quality product designed and installed by smart guys like Greg Ferro, not just one or the other.
Cheers,
Brad