UNEDA (United Network Equipment Dealer Association)
is an alliance of over 300 used network equipment dealers
worldwide. Members of UNEDA range from companies with
hundreds of employees to small organizations within the secondary
market. ?UNEDA members represent the entire spectrum
of the secondary market, from companies with hundreds
of employees and millions of dollars in inventory to small, entrepreneurial
organizations. Together their combined yearly
buying clout exceeds $2 billion, representing the sale of millions
of pieces of equipment to tens of thousands of customers,?
stated John Staff ord, President of UNEDA and COO of
Network Liquidators. UNEDA members must adhere to a
strict code of ethics that includes a fi rm policy against selling
any equipment that is not legitimate. Th ese secondary market
dealers work together, via UNEDA, to promote industry best
practices, ensure standards of used and refurbished product
quality and work towards educating the market about the secondary
market in general and eliminating counterfeit within
the secondary market.
Th is year, UNEDA surveyed its members to determine
trends within the secondary network equipment market, top
priorities for the association to focus on moving forward and
concerns, fears and issues within the UNEDA membership
and secondary market as a whole. 187 UNEDA members participated
in the 30 question survey with the following key highlights
provided by UNEDA.
Upward trends within the Secondary Market
More than 50 percent of the respondents pointed to the increased
demand for, and supply of, pre-owned network gear as
key drivers behind their business expansion in 2008. Another
trend that bears watching over the next year will be how UNE-
DA members step up to their perceived need for providing alternative
maintenance off erings, a trend cited by a promising
one-third of respondents.
?UNEDA can attribute the growth of the secondary market
to the individual members growing and driving their businesses
to new heights. Although a signifi cant amount of business
is always from returning customers, these same customers are
recommending UNEDA dealers to their peers? Staff ord added.
Additionally, UNEDA survey respondents felt their customer
base was becoming more diversifi ed as a result of the economic
downturn. Specifi cally, 40 percent of UNEDA members
polled noted that larger enterprises are turning to the second-
16
Used Networking Dealer Survey Results:
2009 Results
PowerSourceOnline.com | October 2009
ary market to buy/sell equipment while 39 percent reported
an increase in activity from non-traditional end users, such as
fi nancial services companies. Also, 38 percent of the respondents
cited an increase in fi rst-time sellers/buyers as companies
increasingly turn to the secondary market for alternative
methods of equipment procurement.
According to Bernstein Research compiled by Sanford C.
Bernstein & Co. LLC, in 2008, the used network equipment
market was sized at approximately $2.5 billion in size, equivalent
to six to seven percent of the networking equipment
OEM market (excluding wireless infrastructure). Larger enterprises
are buying used equipment more than ever before; in
particular, orders from large banks and insurance companies
have increased.
UNEDA members buying and selling practices
Several questions were added to the UNEDA survey to
provide greater insight into UNEDA member business practices.
Specifi cally, 98 percent of the respondents said they sold
to other UNEDA members, 63 percent sold to systems integrators
and 52 percent sold to authorized VARs. When venturing
outside of UNEDA, 40 percent of those polled reported
selling to less than 100 customers over the past year while 32
percent conducted business with 100 to 250 customers outside
of UNEDA.
When asked about receivables aging, 54 percent of the respondents
cited that their receivables from end users are over
45 days while 70 percent reported that their receivables from
UNEDA members are over 45 days.
Why customers buy
Responsiveness reigns as the prevailing reason customers
choose to do business with UNEDA members, mentioned by
87 percent of UNEDA survey respondents. Responsiveness included
overnight delivery, expedited shipping and overnight
equipment replacement; all are capabilities that are hard to
fi nd when purchasing from OEMs or the authorized channel.
Product availability, rapid delivery and savings vs. OEMs?
also received strong mention for why customers buy from
UNEDA members. 42 percent of UNEDA members said they
enjoyed a high percentage of repeat business over the year, as
proven by the statistic that many customers bought on more
than 20 occasions in 2008.