Every business has assets and that means that every business will need to look into asset recovery, sooner or later. To succeed, a business needs every edge it can get, and that includes maximizing the value of every asset the company holds. Many business assets need to be periodically replaced, whether because of wear and tear or because a superior model has come out. Merely replacing the old assets is just leaving money on the table. Asset recovery is a much better option.
What Is Asset Recovery?
Asset recovery refers to getting as much value as possible from unprofitable and so-called “end-of-life” assets. There are three components to the asset recovery process: identification, redeployment, and disposition.
1. Identification: Just about everything a business owns can be an asset in need of recovery, if it’s just sitting idle. Canceled orders can leave a business with unwanted, maybe even unsellable, inventory, something that is just taking up space unless value can be recovered from it. Old computer equipment, unused buildings, broken down heavy equipment, and more are all ripe for recovery.
Any unproductive asset is not merely not making you money, it’s costing you money in one way or another. At the very least, it’s taking up space that could more profitably be put to another use. It could also be actively draining your money by requiring maintenance or insurance. That’s why it’s important to identify unproductive assets as quickly as possible so that their cost to your business is minimized. You should therefore have a plan in place for identifying unused, unpaid, idle, and end-of-life assets so that as much value can be recovered from them as possible.
Proper asset identification plans need responsibilities, schedules, and budgets clearly set out. The purchase of new IT equipment, for example, should trigger an examination of the old equipment for suitability for IT asset recovery. Best practices should be clearly stated, including stipulating what kinds of equipment need professional asset recovery handling. Also, as a general rule, recovery plans for specific assets should be made at the start of the asset’s lifecycle, rather than at the end, in order to minimize unproductive time and maximize recovered value.
- Redeployment: The easiest, most pragmatic method of recovering value from assets is by redeploying them when possible. There are several ways to do this. Old IT equipment that is no longer up to the demands of research use may still have value in accounting, for example. Worn out equipment may no longer function, but it can probably be broken down for spare parts. It may be possible to repackage unsold inventory and resell it as something else. By getting as much use as possible out of your assets, you are putting off the purchase of more expensive, newer assets. It’s frequently possible to squeeze a lot of value out of seemingly useless equipment this way.
- Disposition: It is not always possible to redeploy your unprofitable assets. However, value can often still be recovered by disposing of the assets in the appropriate way. Donating old assets to charities, schools, or other worthy causes can provide tax benefits. Selling old assets on a secondhand market can be another viable way to recover value. After all, just because equipment is too old for business purposes, doesn’t mean that nobody has a use for it. If neither donation nor reselling is possible, recycling may still be able to extract some value.
There are a number of different types of asset recovery, and some have their own unique requirements. IT asset disposition in particular requires expert, professional help.
IT Asset Disposition (ITAD)
Information technology is constantly changing, and keeping up with your clients and competitors means frequently upgrading your equipment. Disposing of old IT equipment poses some special challenges, though, and not every business is properly equipped to deal with them. For one thing, if the assets are going to be donated, refurbished and resold, recycled for parts, or even just scrapped, they may need to be thoroughly examined for sensitive data and/or sanitized so that the data cannot be recovered later. Simply deleting files is not enough to really erase the data, and if your company can’t take those extra steps then its opening itself up to data theft and maybe even identity theft. Recycling or even simple disposal also has environmental concerns, as IT equipment frequently contains environmentally harmful substances. These concerns mean that it is often best to retain professional IT asset recovery services.
Professional IT asset recovery services, sometimes called buyback companies, usually accept many different kinds of ewaste, including computers, monitors, networking equipment, telephone systems, and servers. They have the tools to destroy the data on your equipment with a much greater degree of thoroughness than your company is probably capable of. They can dispose of the hazardous substances in your IT equipment safely and legally, avoiding the risk of your company being hit with huge environmental fines if you failed to do it properly yourself. Companies in the buyback industry also have extensive professional connections that help ensure you get a good price on the equipment it recycles and resells for you. If you want to get the most out of your assets and minimize the problems your company has to deal with, it’s best to have an IT asset recovery service handle your ewaste for you.
The Takeaway
Asset recovery allows you to handle your idle, outmoded assets in a way that adds to your business’ bottom line instead of dragging it down. This maximizes the value of your assets, giving your business a financial edge that could help make the difference between success and failure. Remember: proper asset recovery practices start at the beginning of an asset’s lifetime, so that the most value can be gotten from it, so it’s best to put a plan together as soon as possible. Some kinds of asset recovery can be handled in-house. Other kinds, though, especially for IT equipment, requires expert, professional help, for both financial and legal liability reasons.
