Computer liquidator

Last updated June 14, 2023

A computer liquidator buys computer technology and related equipment that is no longer required by one company, and resells ("flips") it to another company. Computer liquidators are agents that act in the computer recycling, or electronic recycling, business.

There are several reasons why companies will sell, or liquidate, used Information Technology (I.T.) equipment: bankruptcy, downsizing and expanding, or technological advancement. Technological advancement is the most common reason, as the equipment is no longer performing the tasks required of it, usually because it has been rendered obsolete by more advanced technology coming on to the market. This used or obsolete technology is often referred to as electronic waste. Equipment designated as outdated for one company is still viable for another company, whose operations may not require advanced solutions. Often, an information technology audit will be performed to help a company decide if their equipment needs updating, and if so, what the requirements are.

Reasons for Liquidation

Computer liquidation is a sustainable solution and is environmentally friendly. Rapid technology change, low initial cost, and planned obsolescence have resulted in a fast-growing surplus of computers and other electronic components around the globe. The purpose of computer liquidators is to keep as many computers and electronic parts out of landfills. As newer and better technology replaces hardware at an ever-increasing speed, the amount of technical trash increases as the technology is being replaced. The speed at which hardware changes and innovates in the last few years follows, to some degree, Moore's Law. Predictions were made that every landfill would soon be overflowing with discarded computer screens and computers, along with associated equipment such as keyboards and mouses and all the other hardware associated with use of the Internet. Most electronic waste is sent to landfills or incinerated, which releases toxic materials such as lead, mercury, or cadmium into the soil, groundwater, and atmosphere, thus having a negative impact on the environment.^[1] The best liquidating companies have clearly outlined policies regarding the disposal of dangerous substances which are often an issue with information technology.

The act of liquidation avoids the possible toxins and pollution that comes with putting electronic waste in landfills and also avoids the extra costs that go into recycling. For example, New York passed a law in 2015 that banned putting electronic devices in landfills. Now waste facilities in rural counties are being forced to either turn people away or eat the cost of recycling cathode ray tubes. Outside New York City, counties are spending from $6 million to $10 million a year to deal with the problem, according to Stephen Acquario, executive director of the New York State Association of Counties.^[2] The option of liquidation actually incentivizes people to get rid of their electronic waste in a safer way, since recycling actually costs the owner money, so there are cases where people would rather throw it out to avoid the recycling fee.^[3]

Computer liquidators effectively create a secondary market to meet the demand of those who are looking for a cheaper solution and do not require cutting edge technology. It is important to note that the IT equipment being liquidated ranges from new technology to old technology. Because of the relatively lower price for secondary market equipment, some companies may even purchase tech devices from the secondary market to use as backups, stocking the equipment themselves preemptively so that a replacement is always on hand in the event of trouble. Product availability is also another reason for buyers to buy in this market. Manufacturers generally refresh their product line every 12 to 24 months, typically liquidating older products. But networking hardware can often see service lives of five years or more, and resellers and computer liquidators might carry products that are upwards of a decade old. End users that use a particular product may find it much easier and cheaper to add/replace an older device rather than take on the costs, business disruptions, and knowledge gaps that occur when upgrading to new products. When newer products are adopted, the used equipment is inevitably liquidated, thrown out or sold back, which creates a robust marketplace.^[4]

Process

There are typically three agents in the computer liquidation process: the seller, the computer liquidator, and the buyer. The sellers are companies who are bankrupt and need to sell their assets, companies who are downsizing or expanding, and companies who are upgrading their technology. Usually, companies who are looking to sell their equipment will first conduct an information technology audit to review their systems and equipment. The process is generally fueled by the supply side, as computer liquidators rely on what is available on the market for them to liquidate and resell. Thus, there nearly always exists a shortage for buyers.

Oceantech, for example, buys up computers, laptops, tablets and other such electronics from companies who no longer need the technology. They then conduct certified data destruction on the appliances. Technicians will then perform a thorough check of the systems and confirm that the devices are functional then they are stored into a warehouse. If only certain parts, like the motherboard or hard drives, are able to be used, these are stripped off of the machine and put into a warehouse to store. Then, the devices or parts are resold to smaller companies and places like school districts, who are in need of these products.^[5] Most of the companies involved in the computer liquidation business are also heavily involved in the computer and electronic recycling industry which takes on a similar process of disassembling and testing.

This process theoretically benefits both ends of the exchange, the seller gets money for equipment they no longer needs and the buyer gets cheap equipment that is necessary for their work.

Resources

A number of organizations have sprung up that provide technical guidelines to those handling or dealing in eWaste.

Related Research Articles

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<span class="mw-page-title-main">Consumer electronics</span> Electronic products for everyday use

Consumer electronics or home electronics are electronic equipment intended for everyday use, typically in private homes. Consumer electronics include devices used for entertainment, communications and recreation. Usually referred to as black goods due to many products being housed in black or dark casings. This term is used to distinguish them from "white goods" which are meant for housekeeping tasks, such as washing machines and refrigerators, although nowadays, these would be considered black goods, some of these being connected to the Internet. In British English, they are often called brown goods by producers and sellers. In the 2010s, this distinction is absent in large big box consumer electronics stores, which sell entertainment, communication and home office devices, light fixtures and appliances, including the bathroom type.

Extended producer responsibility (EPR) is a strategy to add all of the estimated environmental costs associated with a product throughout the product life cycle to the market price of that product, contemporarily mainly applied in the field of waste management. Such societal costs are typically externalities to market mechanisms, with a common example being the impact of cars.

<span class="mw-page-title-main">Electronic waste recycling</span> Form of recycling

Electronic waste recycling, electronics recycling ore-waste recycling is the disassembly and separation of components and raw materials of waste electronics; when referring to specific types of e-waste, the terms like computer recycling or mobile phone recycling may be used. Like other waste streams, re-use, donation and repair are common sustainable ways to dispose of IT waste.

Ticket resale is the act of reselling tickets for admission to events. Tickets are bought from licensed sellers and then sold for a price determined by the individual or company in possession of the tickets. Tickets sold through secondary sources may be sold for less or more than their face value depending on demand, which tends to vary as the event date approaches. When the supply of tickets for a given event available through authorized ticket sellers is depleted, the event is considered "sold out", generally increasing the market value for any tickets on offer through secondary sellers. Ticket resale is common in both sporting and musical events.

An Electronic Waste Recycling Fee is a fee imposed by government on new purchases of electronic products. The fees are used to pay for the future recycling of these products, as many contain hazardous materials. Locations that have such fees include the European Union, the US State of California and the province of Ontario, Canada.

<span class="mw-page-title-main">Electronic waste</span> Discarded electronic devices

Electronic waste or e-waste describes discarded electrical or electronic devices. It is also commonly known as waste electrical and electronic equipment (WEEE) or end-of-life (EOL) electronics. Used electronics which are destined for refurbishment, reuse, resale, salvage recycling through material recovery, or disposal are also considered e-waste. Informal processing of e-waste in developing countries can lead to adverse human health effects and environmental pollution. The growing consumption of electronic goods due to the digital revolution and innovations in science and technology, such as bitcoin, has led to a global e-waste problem and hazard. The rapid exponential increase of e-waste is due to frequent new model releases and unnecessary purchases of electrical and electronic equipment (EEE), short innovation cycles and low recycling rates, and a drop in the average life span of computers.

Liquidator may refer to:

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<span class="mw-page-title-main">Computer hardware</span> Physical components of a computer

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<span class="mw-page-title-main">Electronic waste by country</span>

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Recommerce or reverse commerce is the selling of previously owned, new or used products, mainly electronic devices or media such as books, through physical or online distribution channels to buyers who repair, if necessary, then reuse, recycle or resell them.

NextWorth Solutions, Inc., was an electronics trade-in and recycling service. Users of the service exchange used electronics for cash or discounts on newer models. NextWorth was founded by business students at Babson College in 2005. It started as a commission-based service to help businesses setup online auctions for their used items, then changed its business model to focus on electronics trade-ins in 2006. As of late 2012, NextWorth was one of the best-known and largest electronics trade-in and recycling services in the United States, although it handles only a small percentage of total trade-in traffic.

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Clifford Eric Lundgren is an American social entrepreneur, innovator and advocate best known for recycling electronic waste. He was the COO of MiningSky and Founder of IT Asset Partners, Inc. (ITAP), an electronics reuse and Hybrid Recycling company. Lundgren served a year in prison after pleading guilty to copying 28,000 Microsoft restore discs that he intended to use in recycled computers.

A take-back system or simply takeback is one of the primary channels of waste collection, especially for e-waste, besides municipal sites. Take-back is the idea that manufacturers and sellers "take back" the products that are at the end of their lives. Take-back is aimed to reduce a business' environmental impacts on the earth and also increase efficiency and lower costs for their business models. "Take-back regulations have targeted a wide array of products including packaging, batteries, automobiles, and electronics" and economic value can be found from recycling or re-manufacturing such products. "The programs benefit municipalities by lowering their overall waste disposal costs and reducing the burden on landfill sites". Although for certain companies, the take-back system is mandatory under legislation, many do it voluntarily.

References

↑ Jeff Edmondson, http://www.kare11.com/article/news/local/recycling-technology-in-the-twin-cities/152950796, Article in "Kare11" 2016
↑ "Old TVs Create Toxic Problem for Recycling Programs Across America". NBC News. 2016-04-24. Retrieved 2023-06-13.
↑ "Covered Electronic Waste Recycling Fee Guide". www.cdtfa.ca.gov. Retrieved 2023-06-13.
↑ Stephen J. Bigelow, http://searchitchannel.techtarget.com/feature/Secondary-market-resellers-thrive-in-the-tech-industry, Article in "TechTarget" 2008
↑ OceanTech (2016-05-12), Ocean Tech Cool Places to Work - 9 AM Part 2 , retrieved 2023-06-13

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[1] Jeff Edmondson, http://www.kare11.com/article/news/local/recycling-technology-in-the-twin-cities/152950796, Article in "Kare11" 2016

[2] "Old TVs Create Toxic Problem for Recycling Programs Across America". NBC News. 2016-04-24. Retrieved 2023-06-13.

[3] "Covered Electronic Waste Recycling Fee Guide". www.cdtfa.ca.gov. Retrieved 2023-06-13.

[4] Stephen J. Bigelow, http://searchitchannel.techtarget.com/feature/Secondary-market-resellers-thrive-in-the-tech-industry, Article in "TechTarget" 2008

[5] OceanTech (2016-05-12), Ocean Tech Cool Places to Work - 9 AM Part 2 , retrieved 2023-06-13

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