3 ways to cut costs through third-party hardware maintenance

Hardware Maintenance


Chris Adams September 20, 2018

In some cases, dedicated providers offer costs as low as half of what the OEM offers.

With the final quarter of 2018 here, many businesses are assessing their fiscal situation and are working to have a strong finish to the year. For some organizations, this means finding ways to cut costs without sacrificing quality. A third-party hardware maintenance plan can help IT managers achieve this goal.

There are a wide range of features within a hardware maintenance plan, meaning that there are many ways to reduce expenses through such a strategy. However, a few attributes of third-party support plans stand out when it comes to cost reduction:

1. Reduce warranty costs

Getting a solution like Dell support from a third-party maintenance provider is usually much less expensive than an extended warranty from the OEM. In some cases, dedicated providers offer costs as low as half of what the OEM offers. These reduced charges do not mean less service. Instead, they reflect that maintenance vendors use support as their core competency and therefore price to be competitive in this area. OEMs, on the other hands, are focused on selling hardware, with maintenance being a secondary concern. This is not, in any way, meant to be a statement against OEMs, as many offer quality services. Instead, it is pointing out that dedicated maintenance vendors have refined their operational methodologies around offering superior services at the best price point possible. As such, IT managers can look at the low cost of dedicated maintenance and support plans without having to worry that it is too good to be true.

2. Avoiding capital expenses

Purchasing new hardware represents a capital cost that many businesses cannot afford to take on. However, there are times when IT managers must choose between spending heavily for an OEM extended warranty or buying new hardware. In many cases, the decision is to invest in a hardware refresh, even when the systems already in use are getting the job done. The low cost of third-party maintenance plans changes the balance of this scenario. The maintenance fees are low enough that purchasing new hardware is no longer the clear option when a refresh is not necessary. As such, IT managers taking full advantage of a third-party maintenance plan can eliminate unnecessary capital costs and establish a much more efficient fiscal foundation.

3. Easing waste concerns

Disposing of IT components can be an incredibly expensive and sensitive process. Hard disks, for example, contain specialized elements that must be disposed of following proper protocols. They also need to be erased and then completely destroyed to ensure data is entirely inaccessible. Performing this task for hundreds of hard disks can be incredibly expensive. Throw in the expense for servers, storage arrays and network systems, all of which have precious metals and hazardous materials that require special disposal processes, and IT managers can be left spending heavily in terms of time and even consulting help just to cast aside old hardware.

A third-party hardware maintenance plan delays the waste problem by extending hardware life cycles. At the same time, many vendors also offer specialized disposal services in which the service provider takes care of the IT waste. This can prove integral to keeping costs under control.

Total cost of ownership is a critical consideration when trying to maximize the value of hardware investments and reduce expenses. Simply looking at initial purchasing fees compared with OEM extended warranties is not enough to adequately evaluate the financial situation surrounding data center hardware. Instead, IT managers need to look at costs throughout the entire hardware life cycle. Third-party maintenance plans can reduce expenses during the key latter portion of a system’s use period, creating considerable savings over time.

About the Author

Chris Adams, President and Chief Executive Officer
As President and CEO, he works side-by-side with other key leaders throughout the company managing day-to-day operations of Park Place. His key objectives include streamlining work processes and ensuring that all business initiatives and objectives are in sync. Chris focuses on key growth strategies and initiatives to improve profitability for Park Place, and is responsible for European and Asia-Pacific sales and service operations.