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Don't sweat the asset just trade it in

Moves by Tech Data to make it easier for resellers to trade in old equipment could be a smart move thinks Billy MacInnes

I think we should file this particular initiative from Tech Data in the “good idea” section. The distributor has decided to provide a service, Tech Data Renew, that helps resellers offer trade-ins on a range of mobile products, such as smartphones, tablets and laptops.

Tech Data claims resellers can use the “highly competitive service” as part of their proposals to customers and it “can provide swift and decisive responses to requests for quotations on specific products”. The service is available through a dedicated portal, accessed via Tech Data’s InTouch e-com platform.

Simon Smale, commercial director of services, Europe for Tech Data, argues the service is responding to a growing need in the channel. Many businesses and users are keen to use the latest technologies, so they want to refresh their devices more frequently. “But they also want to make sure they get the very best value from their existing assets,” he states. “Trade-ins are becoming an important element in the market, especially with premium brands that retain high residual values.”

He claims the Tech Data service makes trade-ins easy for resellers and “enables them to offer creative and attractive propositions to customers on new devices”.

The main benefit for resellers (and vendors), of course, is that it helps to speed up product refresh cycles and sales. And the trade-in scheme fits neatly with a particular group of products that people are much more inclined to want to upgrade more frequently than some of the more traditional IT products.

Obviously, with this type of scheme, the valuation of the original device is an important consideration. People making the trade-in have to feel they’re getting a good deal for the product they’re replacing.

Still, there’s no reason why this type of scheme shouldn’t work. We’re all very accustomed to trade-ins when it comes to cars. Indeed, without the option to trade-in their older car, people probably wouldn’t replace their cars anywhere near as often as they do.

I haven’t been able to find out whether other distributors offer similar schemes but it wouldn’t surprise me if more of them took up the trade-in option in the future. That said, I can find evidence of something similar on a smaller scale in Ingram Micro’s announcement of its Surface-as-a-Service programme back in August last year.

The focus of the announcement was primarily on the ability of partners to “supply their customers with a managed offering of Surface hardware and associated cloud software on a leased basis”. But the distributor did mention that customers would have access to leasing options “which endeavour to reduce risk and will improve key financial measurements, with the adaptability of trade-in and buy back services from Ingram Micro”.

Anyway, there’s no doubting that if the trade-in option gains traction, it should add a very useful extra weapon to a reseller’s armoury – and encourage customers to upgrade their equipment more often. After all, there’s less point sweating the asset if you’re driving down its trade-in price in the process.

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