Ever since Arrow Electronics pulled an Enron on the ITAD industry back in 2019, there’s been chatter and opinions regarding the merits of having two (or more) ITAD providers. While diversification always provides a degree of value, in ITAD it also provides a degree of complexity to be contemplated. Before jumping into the pool, consider the following:
- The initial cost associated with RFI, RFP, contracting activity, vendor onboarding, and the development cost of data normalization and integration (this is huge)
- The ongoing cost of vendor management, the duplication of effort associated with another provider, the incremental effort needed to always compare providers (like a constant RFP), and the operational challenge associated with requestors having to decide multiple vendor portals
- The number and cost of incremental resources needed to make this happen – coupled with the chances that your organization will actually fund it!
Whatever risk is mitigated by a two-vendor strategy, watch out for incremental complexity that may more than add back. Let’s not forget the value of the basics - the management of this risk starts with good old-fashioned blocking & tackling in risk management and vendor management. The most reliable vendors over the years have arguably been the pure play ITADs with focus and dedication to providing a quality service.
The Arrow debacle was a “black swan” event taking place at a company where ITAD was a small part of the business. An optimal single-threaded ITAD solution rewards its customers with superior financial and sustainability results at minimal downside risk.