![\"Proccessors\"](\"https:\/\/www.itadsummit.com\/wp-content\/uploads\/bb-plugin\/cache\/Proccessors-circle.jpg\")
\n\tIn the midst of coronavirus-related closures, ITAD companies are reporting decreases of up to 75% in the flow of used IT equipment from corporate accounts and other organizations.<\/em>\u00a0|\u00a0Zhuravlev Andrey\/Shutterstock<\/em><\/p>\n At enterprises across North America, IT asset refresh projects are no longer a top priority. That has meant major volume drops for material processors, as well as painful staffing cuts in some cases.<\/p>\n For example, Southern California processor Cal Micro Recycling was forced to lay off half its workforce recently.<\/p>\n \u201cThat day was the worst day of my life,\u201d said Roy Dann, founder, and CEO of Cal Micro Recycling and its CRT-recycling-focused sister company, GLS Group. These days, his goal isn\u2019t to turn a profit but to keep his remaining workers employed and safe.<\/p>\n With the coronavirus pandemic keeping offices and other businesses closed everywhere, ITAD companies are reporting decreases of up to 75% in the flow of used IT equipment from corporate accounts and other organizations. The trend\u00a0has also been acutely felt<\/a>\u00a0by companies that recycle household electronics.<\/p>\n Some ITAD operators report they have been buoyed by the continued flow of electronics from essential service providers, such as health care companies, but they are still having to adapt to operating environment challenges.<\/p>\n Even as they feel temporary shocks, however, many companies are keeping an eye toward the eventual recovery.<\/p>\n Different processors feel the collections pinch in different ways.<\/p>\n During a recent webinar hosted by e-Stewards, Todd Zegers, vice president at Ingram Micro Commerce and Lifecycle Services, talked about the impacts of the slowdown. His company has facilities in Arizona, California, Florida, Georgia, Illinois, Indiana, Massachusetts, Minnesota, Nevada, New Jersey, Ohio, Texas, Virginia and Washington state that are performing ITAD functions.<\/p>\n Zegers said that 75% of his company\u2019s workers are warehouse workers, and if there is a material shortage, they can\u2019t work. \u201cThe volume coming in the door \u2013 that\u2019s the biggest hurdle right now,\u201d he said.<\/p>\n His company works with clients on a \u201cbox program,\u201d through which employees working remotely can mail in their old equipment to Ingram Micro. This is an increasingly important avenue for getting material, Zegers said.<\/p>\n \u201cThe volume coming in the door \u2013 that\u2019s the biggest hurdle right now.\u201d \u2013 Todd Zegers, Ingram Micro Commerce and Lifecycle Services<\/p>\n For Cal Micro, which is based in Ontario, Calif., the downturn has been \u201ca huge hit,\u201d Dann said. The company has a public drop-off area, but about 99% of the material it handles comes from government agencies, school districts, nonprofit groups, and businesses.<\/p>\n Because of widespread closures, Cal Micro\u2019s incoming volume has dropped to roughly 35% of what it used to be, he estimated.<\/p>\n The business slowdown has meant laying off half the staff, talking to the landlord to seek relief, and looking at government business assistance, he said. That being said, Cal Micro Recycling is not in a desperate place, he said.<\/p>\n Dann noted his concern has been for the health of his current and former employees, as well as health care workers in the community. His operation\u00a0has taken myriad steps<\/a> to keep workplaces safe, and his staff has been actively calling laid-off employees to see if they need anything, as well. He has been donating personal protective equipment, including masks, goggles, and full-body hazmat suits to hospitals.<\/p>\n \u201cWe\u2019re focused more on doing what\u2019s good for society now and less worried about the profitability of the business,\u201d he said.<\/p>\n In Canada, Quantum Lifecycle Partners, a processor handling both household and organizational material, has remained open but has experienced a 40% to 80% drop in volume, depending on the region and vertical, said Clayton Miller, the company\u2019s vice president of end-of-life sales.<\/p>\n \u201cOn the commercial side, we are actually pretty busy on the ITAD front in light of everyone trying to work from home,\u201d Miller said. \u201cThat will die down eventually and we\u2019re already seeing that. Normal day-to-day pickups are pretty much all frozen.\u201d<\/p>\n In the Midwest, Sadoff E-Recycling and Data Destruction experienced big drops in incoming volumes from certain sectors in March, although the numbers year-over-year are up because the company is still in growth mode, said Jason Lasky, executive vice president at parent company Sadoff Iron and Metal and manager of the electronics recycling business.<\/p>\n \u201cThere\u2019s a lot of people that are just busy, so they\u2019re just pushing it off. Scrapping isn\u2019t necessarily everybody\u2019s first consideration, especially now,\u201d Lasky said.<\/p>\n Sadoff E-Recycling and Data Destruction have electronics processing facilities in Oshkosh, Wis., and La Vista, Neb. (near Omaha). Most of its electronics come from organizations, as opposed to households.<\/p>\n Other e-scrap companies have been sending his company material for processing, which has helped fill the volume gap. \u201cThe dealers are helping each other at this point, which I think is helpful,\u201d he said.<\/p>\n So far, his company has been able to avoid staff cuts, he said.<\/p>\n \u201cWe are asking [customers], \u2018Do you have the storage where this can wait?’\u201d Neil Peters-Michaud, Cascade Asset Management<\/p>\n Elsewhere in the region, Cascade Asset Management, which has facilities in Madison, Wis., and Indianapolis, reports the drop in supply hasn\u2019t presented a major problem.<\/p>\n \u201cWe had pretty good stockpiling going into this,\u201d Cascade CEO Neil Peters-Michaud said during the April 7 e-Stewards webinar. Also, slower supply balances with the fact that workers have needed to stay home for childcare and other reasons. Of the ITAD company\u2019s 90 employees, about a third are working from home.<\/p>\n The company is trying to work with clients to only serve those that absolutely need it.<\/p>\n \u201cWe are asking [customers], \u2018Do you have the storage where this can wait?’\u201d Peters-Michaud said.<\/p>\n <\/p>\n Exit Technologies is using spare equipment to help power the Folding@Home project supercomputer, which is assisting the development of a coronavirus treatment by simulating the dynamics of the virus\u2019 proteins.<\/em>\u00a0|\u00a0Courtesy of Exit Technologies.<\/em><\/p>\n Jeremy Schaller of Naples, Fla.-headquartered ITAD company Exit Technologies estimated his company has experienced a roughly 25% drop in the company\u2019s incoming volume. He noted that a number of the largest data center hubs are located in areas heavily hit by the virus.<\/p>\n \u201cFor example, New York constitutes a very significant portion of our business, and we\u2019re having trouble getting any data center assets out of New York at the moment. Oregon is another one, in particular,\u201d said Schaller, who is an industry analyst and public relations manager for Exit Technologies.<\/p>\n Exit Technologies is still fully operational, as are many other recyclers, he noted. But the flow of used electronics has slowed for several reasons.<\/p>\n Businesses that produce IT equipment are either closed or are only fulfilling key functions, pushing side projects, such as getting rid of unneeded equipment, to the bottom of the to-do list, he said. Datacenter IT employees are preoccupied with addressing the vulnerabilities of having a wholly remote workforce, he said, pointing to security vulnerabilities<\/a>\u00a0in Zoom video conferencing software.<\/p>\n \u201cBut I think even if security wasn\u2019t such an issue, the massive strain that is being placed on data centers right now would be enough to sideline ITAD,\u201d Schaller said. \u201cPeople are consuming more content online and in general, the number of workloads has skyrocketed.\u201d<\/p>\n \u201cNew York constitutes a very significant portion of our business, and we\u2019re having trouble getting any data center assets out of New York at the moment. Oregon is another one.\u201d \u2013 Jeremy Schaller, Exit Technologies<\/p>\n Another factor is the complicated nature of moving equipment from Point A to Point B right now.<\/p>\n Some states have instituted strict lockdowns, making travel difficult for ITAD company technicians and any contracted logistics company drivers, Schaller said.\u00a0The New York Times<\/a> reported on April 6 that multiple states have implemented interstate travel restrictions, including Rhode Island, Florida, and Texas. Local governments within states, including New Jersey, have also cracked down on out-of-area drivers. Delaware police are too, according to\u00a0NJ.com<\/a>.<\/p>\n Schaller said his company is looking into ways to perform ITAD tasks without having the on-site staff typically needed for larger projects, such as data center decommissions. Meanwhile, Exit Technologies is also lending its spare computing power to the\u00a0Folding@Home\u00a0project, which is\u00a0using processing power<\/a>\u00a0from people\u2019s computers to create a supercomputer. That computer is simulating the dynamics of coronavirus proteins in the hunt for a virus treatment.<\/p>\n \u201cFor people in the IT world with hardware, it\u2019s one of the best ways we can help,\u201d he said.<\/p>\n New York state-based processor EWASTE+ has been able to keep about half of its fleet of 12 trucks moving by serving essential businesses, including hospitals, food distribution companies, and others, company President Mike Whyte said.<\/p>\n \u201cSeveral of our NYC hospital customers are utilizing us to clear out storage areas filled with end-of-life electronics and other equipment to make way for COVID-19 supplies and to increase bed capacity,\u201d Whyte said.<\/p>\n Based in Victor, N.Y. (outside Rochester), the 25-year-old company also has locations in Scotia (outside Albany) and Ossining (near White Plains, closer to New York City). Roughly 75% of its incoming electronics come from organizations and 25% come from households.<\/p>\n The company\u2019s first-quarter incoming volume was up slightly year over year, buoyed by higher January and February numbers, but March saw a 30% decline year over year, Whyte said.<\/p>\n Many companies expect that once COVID-19 cases subside and the lockdowns lift, a surge of material will likely enter the system.<\/p>\nThe impact of decreased collections<\/h3>\n
Decreased volume of the new normal<\/h3>\n
Providing service in the epicenter<\/h3>\n
Anticipating the inevitable recovery<\/h3>\n