3 Myths About IT Asset Disposal and Electronics Recycling

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Many companies in the electronics recycling and IT asset disposal industry utilize scare tactics and try to focus a buyer’s attention on false narratives to win new clients and increase profitability of contracts.  We believe in transparency and educating our clients.  Here are some facts in response to three common myths being disseminated by disposal service providers.

The Myth: Allowing a disposal vendor to reuse or sell your equipment creates additional liability for your organization.  Allowing the third party vendor to sell the equipment will be a problem for your organization since the item can be found in a landfill in the future or can otherwise be utilized inappropriately. 

Some of our competitors use this inaccurate storyline to convince organizations to dispose of valuable equipment at an inflated cost under the premise that the vendor will be destroying the equipment and no asset will be sold as a functioning unit that can be traced back to the original owner.  Whatever the IT asset disposal vendor’s motive is, the idea that all surplus computer and IT equipment must be dismantled and destroyed to remove downstream liability is flawed and environmentally irresponsible.

The Fact:  With best practice data destruction and chain of custody processes in place selling surplus assets is a secure, environmentally responsible, and an economically practical solution for retired computer equipment.  All organizations should document IT asset disposal work with serialized inventory reports, transfer of ownership statements, bills of sale and link transactions to a formal master service agreement.

The IT asset disposal vendor should be utilizing an inventory management system that can track the asset from receipt from client to the sale to end user or downstream partner in order to address any unlikely disputes or exposures that could be inappropriately traced back to the disposing entity.

Consider other common situations of transferring assets such as selling a car.  Would one expect to be liable after legally selling a car with appropriate documentation to a buyer who then goes on to cause an accident?

Call Them Out:

If a vendor has made this claim ask him/her to provide proof of a real world example where an organization has faced a fine, legal trouble, bad publicity or any other liability related to the sale of company IT assets.  Ask the vendor to provide any legal documents to support this claim.

The Myth: Only vendors with this (insert any third party certification here) are doing things right and any other provider will be breaking environmental regulations and putting your organization at risk. 

When a competing vendor has very little to display that will separate their firm from the pack they might inflate the importance of the specific third party certifications they hold and make false claims that these certifications are the end all to your organization’s liability concerns.

The Fact:  There are two prominent certifications (R2, e-Stewards) commonly obtained by ITAD providers and these certifications include requirements to hold ISO 14001 as well as OSHA health and safety management systems.  Both certifications are very similar, but neither guarantees a vendor will be compliant with your company’s environmental policy or legal regulations.

Doing your own vetting, documenting due diligence, and implementing a formal agreement is as important as your vendor maintaining a third-party certification.

Call Them Out:

If a vendor has made the claim that the certification they hold is superior or a must have certification ask them to prove this with metrics and supporting facts.  We also urge you to do your own research and see that the EPA and the Federal Government's policy, driven by an executive order from the President of the United States of America, values these certifications but does not favor one over the other.

Myth: If your current provider is paying you for equipment or providing a no cost solution they are breaking environmental regulations and must be dumping the waste illegally either domestically or internationally. 

Many competitors utilize this scare tactic to get valuable equipment from companies and collect inappropriate fees.

The Fact:

If an IT asset disposal vendor is buying your surplus equipment at a reasonable value it would make no business sense for that vendor to then throw away the stock or illegally export it as waste.  When a vendor pays for equipment your organization is at less of a risk.  In order to sell the surplus equipment the ITAD vendor will have to wipe data, clear networking equipment, re-image, and warranty the equipment as a functioning system to another buyer.

All ITAD providers should be able to provide a pricing model that accounts for the market value of a client’s disposable equipment.  If the equipment does not have value the client should incur a fee for destruction and management services.  If the equipment has some value but only covers the operating costs of the vendor a no cost solution can be appropriate and fair for both parties.  If the equipment’s value significantly exceeds the logistics and operating costs of the disposal vendor a credit or cash back for the equipment is due to the client.

Call Them Out:

If a vendor makes this claim again ask them to provide a real world example where assets sold to a computer disposal provider at reuse value created a liability, fine, or negative publicity for the organization disposing of the assets.  Ask the vendor why would a company pay for a company’s disposable assets, or even take on the logistics costs of removing the equipment if they could not turn the product back into a profitable sale on the secondary markets.

by Frank Milia
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