Servers

Refurbished servers - good deal or something to avoid?

The economy is down and IT budgets are shrinking. How do you keep moving forward and providing enhanced value to the organization while, at the same time, your budget is heading toward zero? Scott Lowe explains how refurbished servers might help you stretch your budget dollars.

Although the economy is not exactly in great shape these days and the news of downsizing keeps coming, organizations must continue business as usual as much as possible.  That means that IT in those organizations needs to keep forging ahead.  Of course, this also means that servers need to be upgraded and replaced and new servers need to be installed in order for the organization to continue to implement new technology initiatives.  If your server budget is shrinking and the expectations on your services have not kept pace, how can you keep up?

Note: I'm going to focus on Dell refurbished equipment here since I've had quite a lot of experience with them.

Refurbished servers can provide you with a great way to keep the upgrade cycle in place at a lower cost than buying new servers.  Often sold for much less than new equipment, refurbished servers generally carry the same warranties as brand new equipment and can sometimes be available more quickly since they do not need to be built.

For example, at Westminster College, we use Dell M600 blade servers.  Our current servers are configured with dual quad core 2.33 GHz Xeon processors with 32GB of RAM and two 73GB SAS disks.  A few months ago, before the M600's were available in the Dell refurbished store, we paid around $4,000 for each blade server with this configuration.  Last night, in perusing the Dell refurb store, I found M600's with dual quad core 2.8 GHz Xeons processors and 32 GB of RAM for less than $2,500.  That difference is pretty significant.  If you need a lot of servers, the difference can add up very quickly.

On the downside, if you start buying refurbished equipment, it's more difficult to buy servers with a consistent configuration.  You get what you get, as it were.  If you need ten servers and you hit the store at the right time, you might get lucky, but you can't count on it.

The main worry with regard to refurbished equipment lies in the warranty service and stability.  As I mentioned, Dell refurbished equipment usually ships with the same warranty that would be included with new equipment.  Further, you can choose to extend the warranty for an additional charge.  As for stability, speaking from experience, I've never had a bit of trouble with any of the servers I've purchased refurbished.  In addition to servers, I've also purchased a number of refurbished Dell desktop computers, laptops and storage devices.

Pros

  • You can save a whole lot of money by buying refurbished equipment
  • The equipment usually includes the same warranty as new equipment

Cons

  • You may not be able to locate the exact equipment configuration that you need
  • There is a stigma attached to the word "refurbished"

If you're buying in large volume, you may not be able to get a better deal in the refurb store, but it definitely doesn't hurt to check, and you may be able to extend that shrinking budget just a little further.

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Have a topic idea or question you’d like me to address or answer in a future post?  Email me directly right here at trfeedback@slowe.com.

About

Since 1994, Scott Lowe has been providing technology solutions to a variety of organizations. After spending 10 years in multiple CIO roles, Scott is now an independent consultant, blogger, author, owner of The 1610 Group, and a Senior IT Executive w...

11 comments
tdotson2013
tdotson2013

Please also remember that You can find companies that can build a refurbished server to your companies specifications. Dell outlet is not your only option. www.velocitytechsolutions.com is a great option and they are available 24/7/365. If its not listed on their website they will still find it for you.

ricardoc
ricardoc

Hi guys! Interesting article, but can someone tell me where can I check for these deals? I just got out of a chat with a Dell agent and he assures me that they don't have such a thing as refurbished hardware. Any tips are welcome. Thanks,

TG2
TG2

Refurbs are good... MMmmmm K.. We do refurbs too ... some really great deals on IBM stuff ... I prefer IBMs to dell ... the Dell servers (every type I've seen) boot like they are trudging through molasses ... I mean they work nicely when running.. but if you ever have to reboot them.. it takes them 3 to 5 times as long to boot than does a comprably equiped server from *any* other vendor (well maybe with the exception of some SUN equipment) and we also do a lot of SUN refurbs.. each in their respective extended warranties.. even if the warranty adds 25 to 40% of the cost to the server.. a 3 to 5 year extended warranty is nothing to sneeze at.. We also look for liquidations, when a company is bought or sold.. their hardware might go to 3rd parties that sell in lots.. got some VA-Linux built machines that way.. some custom designed and built 2U machines with dual dual core CPU's and four drives either permanantly mounted or adapted for front swapables.. the latter I think with 4 36gig scsi drives and 2 or 4 gigs of ram was under 300 a piece... 300!! and they are excellent for *nix servers and even for windows box solutions.. just incredible values.. hell the OS (windows server) cost more than the servers.. LOL

jason
jason

While $WORK doesn't use refurbished or used equipment for production environments, we maintain a pool of decommissioned systems to be used for side-projects, development, and temporary stuff. It works out wonderfully, especially when you need one box for, say, a Nagios collector and that shiny new quad-core would be horrible overkill. On the personal side, I have a few machines lying around that host my personal website and are used for development. Most of them were bought as as-is off-lease equipment, and I've had very very few problems (though when buying off-lease, I generally buy twice what I need and grab the best parts, leaving one good machine and one for spares). On a personal note, though, (not to start a vendor war) I've had much better luck with older Sun machines and HP Proliants than dell.

DWalker88001
DWalker88001

The guy chatting with you was lying, or horribly misinformed. I just went to the Dell site and clicked around a little and ended up with a page that has a link labeled "Refurbished Servers". Go to www.dell.com. The dropdown "For Office" (hover over it) has a section "Servers, Networking and Storage". Hover there, and the fly-out has choices. Pick any of them; I picked "Small and Medium Business". The resulting page, http://www.dell.com/business/enterprise?~ck=mn, has a link in a dark gray horizontal band near the top, labeled "Dell Outlet". Hover there, and you can choose "Dell Outlet Servers and Storage". The left side has a blue section near the top with refurbished this and refurbished that. All of this "hovering" and fly-out menus work on IE7 on Windows XP. Tell the chat guy that he doesn't know what he's talking about!

robo_dev
robo_dev

For those who are skittish about buying 'used' gear, we would remind them that what they are using now, is, in fact, used. So the prior owner did them a favor by performing an 'extended burn-in' for them, and now the chance of finding some manufacturing defect is much less likely.

jck
jck

if something you implement works performance-wise to your satisfaction on your old test platform, then newer production servers will give you even better results (usually lol)

ricardoc
ricardoc

Thanks DWalker88001. What happened is that I was browsing the Canadian site of Dell. Curiously they appear to be a replica of each other except for the fact that the item "Dell outlet" on the Canadian version doesn't exist. As if there where not refurbished, returned or whatever hardware in Canada! Go figure it out! Anyway thanks for the link. My question to Dell now will be if I can purchase from the USA branch and have it imported to Canada. They really have good deals on that site. Regards,

PRIMEREBEL
PRIMEREBEL

From what I've seen, refurbished can be better than new. More testing has usually been performed during the refurbishing process than the manufacturing one.

robo_dev
robo_dev

You argument that used-and-untested off-lease equipment is somehow more reliable than tested and refurbished equipment makes no sense, unless you're promoting a company that sells used-and-untested off-lease equipment, oh wait.....you are, based on the last sentence. Your statement about Dell shipping to Canada is both false and misleading: You buy from Dell Canada, and you get warranty. Every company on the planet which has a sales presence in one country will not provide warranty coverage for products sold in another country. Those are called 'gray market' goods; it's true for everything from Porsche to Cuisinart. I've purchased a lot of refurbished Dell equipment and have taken many of these units apart, down to the board-level. In every case, the Dell refurbished unit is indistinguishable from a new unit, with the exception that there may be minor scratches on parts, as you might see on anything that has been disassembled post-factory. The biggest issues with used equipment is dust and dirt and the condition of the fans. I am not sure if they put in new fans when Dell refurbs a unit in every unit, but they appear to be new. The fans in used equipment may be caked with dirt and/or may be at the stage where they are getting noisy and/or are going to fail shortly.

Redeye3
Redeye3

To answer the question of Dell shipping USA product into Canada, I believe if it is shipped out of the USA then they void the warranty. I agree that the word "Refurbished" has a negative connotation. My definition of "refurbished" means that something failed and it was then repaired. Giving the same warranty period brings some comfort but the inconvenience of having something fail and having your server out of commission sometimes is a bigger worry for us IT people! Another very valid option is to simply buy "used" or "off-lease" equipment. You can then buy in large quantities from third party vendors and get the exact configuration that you need. And they usually can provide the same configurations for years to follow. You also have no worries that if you need a replacement part that they will tell you they no longer stock the parts you need!