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Sold! Dell refurbs to the highest bidder

E-commerce, secondhand-style

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Dell will flog secondhand machines on its Web site. And it will auction them to the highest bidder. Is this wise? By doing this, Dell retains more margin from refurb sales -- it doesn't have to share margin with specialist brokers. And as an A-brand, Dell secondhand PCs hold their value better than most. But by selling old kit from the shop window, as opposed to the back door, Dell risks cannibalising new PC sales. In case you hadn't noticed, Dell makes most of its money from selling new machines -- not refurbs. So, punters may be tempted to bid secondhand, rather than buy new -- especially consumer and small business buyers. This is why Intel hates the electronics recycling movement. More refurbs means fewer sales of new kit. Dell has plenty of secondhand kit to get rid off -- because it is big, and because it is big with corporates. Under leasing deals, it has to take old kit back. Some of this gets broken down for spare parts, but most gets sold or donated to the usual impecunious refurb channels -- students, charities, third-world countries and the like. The secondhand ball will start rolling on the Dell US web site, in the next couple of months, according to Bloomberg

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