A holistic approach balances needs across an entire global enterprise
This principle continues to drive a focus on process simplification and maximizing efficiency in the R&D and production environments. Such strategies have become vital for day-to-day operations in most sectors. Now, business leaders targeting the very highest levels of excellence are extending this rigor to the proactive management of idle and surplus analytical, laboratory, and other equipment, recognizing the often dormant value in these assets.
A whole-business approach
There have always been equipment dealers buying up surplus assets for pennies on the dollar and selling them. But in recent years, as companies have been discovering the hidden value in idle assets found throughout their enterprises, asset management best practice has been evolving. Specialist service companies, staffed by industry experts and proven project management professionals, offer an approach and services that are different from the traditional equipment dealer or auctioneer.
One vendor in this field, EquipNet, provides a holistic approach to surplus asset management that balances needs across an entire global enterprise. This is effectively illustrated using its proprietary ‘Value Control Model.’ The figure below shows how a managed program can be customized based on time and can involve various disposition channels, including redeployment, negotiated sales with managed pricing through an online marketplace, competitive auction events, and clearance programs.
A central tracking platform
After making a significant investment in evaluating, selecting, and purchasing a piece of equipment, redeploying that asset to another part of the business when its initial use is over delivers the highest ongoing value for the asset. However, redeployment cannot be successfully and consistently achieved unless there is a central tracking platform installed within all company locations. Users should be able to post, track, identify, and internally redeploy equipment that is not being used in its present location, ahead of moving to external sale. Features to look for in an asset redeployment management system include a robust platform that sits behind a company’s firewall, a simple user interface that allows workflow management, multiple access levels for managers and executives across the business, and indepth search functionality. Comprehensive listing specifications that provide information that lets the company know what it has and where the equipment is located are important too.
If a company chooses not to redeploy an asset, a sale or disposal is the next logical step. The rise of the Internet has seen the development of online marketplace packages to meet this need. When considering an online transaction, however, particularly for a high-value and complex piece of equipment, the human touch is perhaps still the most important factor. Using a vendor with specific industry experience is crucial to success. “Companies have been discovering the hidden value in idle assets found throughout their enterprises.”
A desire to recoup as much money as possible on surplus assets may, in certain circumstances, be superseded by time constraints. In this case, liquidity becomes the highest priority. Auctions are another dependable channel for achieving this goal. Designing and managing a successful auction event depends on many factors. A specialist partner should advise on the right approach in each case; your options might include online auctions, live/webcast auction events, and sealed bid and private treaty sales. Innovation should be at work here too; look for active marketing by the auction provider, expert knowledge of the equipment being offered for sale, and a flexible approach to managing bids close to, but under, any reserve set.
Assets that hold very little value are best dealt with through clearance, by donations, or by scrap and environmental recycling. Working with your chosen expert, you should expect to be advised of the scrap value of your idle equipment and presented with a comparison of that amount against the market value to sell it, together with a recommended strategy that will generate the highest rate of return.
Understanding what equipment you have, and where in the business it is located, provides solid information for laboratory managers to plan effectively. But a proactive approach is not without its challenges, requiring formalized processes, specialist knowledge of the industry and its equipment, dedicated resources, and a concerted effort to change asset management practices. Many businesses lack the time or resources necessary to establish a successful program themselves. For this reason, many companies are relying on partnerships with specialist service providers for cash release, reduced costs, and increased efficiency.
CASE STUDY: Maximum return on the closure of an R&D department
The Challenge: In March 2013, a major pharmaceutical company approached EquipNet for help with closing a section of its R&D laboratory facility in northern Germany. A six-month timeframe was available to complete the project.
The Scope: The company wished to expose an inventory of redundant assets from this site to the histology and vivarium departments throughout its enterprise, with the intent of redeploying as many assets as possible. In addition, all remaining items were to be sold within the six-month project time frame.
The Approach: All assets were catalogued and photographed, and fair market valuations were established for each item. Assets were then listed on a secure, company-specific software platform so that the organization’s 170 facilities across the globe had full exposure to the items available.
Due to tight time restraints, the equipment was simultaneously advertised online. Items that didn’t redeploy or sell through the managed price approach were put in a web-based auction.
The Result: The company was able to redeploy 10 percent of the items. More important, by relocating this equipment, purchase of new equipment was avoided, which equated to a cost saving of more than $200,000. Sixty-four percent of the items were sold. A further 20 percent of the items held no resale value and were scrapped.
The location was cleared within the allotted time frame, and the company maximized the return on its original investment in those assets—all without interrupting ongoing operations.
Like this article? Click here to subscribe to free newsletters from Lab Manager