News

CDs rock the refurb world

ATM refurbishers are finding there's not a lot of profit in cash dispensers.

December 31, 2000

It takes more than a can of cleanser to get the job done at ATM Exchange and Atlanta Computer Group, two companies who have been in the ATM refurbishing business a combined total of 32 years. Unfortunately, that's not the case at all refurb companies. ATM Exchange Vice President Bill Mercer and ACG President Woody Alderman say that the less-than reputable businesses known as �blow and go� shops hurt the entire industry. Since the advent of low-priced cash dispensers, there seem to be more of them around. �With the cash dispensers, a lot of guys are just grabbing the machines, 409'ing them off and sticking them back out there,� Alderman said, mentioning a popular cleaning agent. �We put a little more into a refurb job.� �We're able to support a wide range of configurations and models, but there are many people in the business that don't step up to that challenge very well,� Mercer said, noting that his technicians know what options are available on practically any make or model ATM. �There's a lot of little �gotchas' people can get caught on because they're not experienced or knowledgeable. That's a part of the business people tend to mess up the most, and it hurts all of us,� he added. Both Cincinnati-based ATM Exchange and Atlanta-based ACG prefer to focus on more expensive, fuller-featured machines rather than on what Mercer calls �de-featured, low-cost cash spitters.� Compared to fuller-function machines, cash dispensers pose less of a challenge to a refurbisher, Mercer said. �They're like a Model T relative to a car that has lots and lots of different options. They're usually a bit less complicated to refurbish because there isn't much reconfiguration involved.� ATM Exchange sells refurbished machines mostly to small- to mid-size financial institutions. Mercer said not many of those clients are in the market for a used CD -- or a new one, for that matter. They want more features and options for upgrades. After investing in parts and labor, Alderman said it's difficult to make money on a cash dispenser refurb. Most buyers are looking for a pretty cheap deal on a used machine, since they can get a new one for under $7,000. Alderman said he wouldn't be willing to pay more than $500 for a used $5,000 CD. �We take a risk by buying them and letting them sit on the shelf. We put money in them, and then the interest clock starts ticking. There's freight involved shipping them in and out, and I've got to pay a salesman commission on it,� he said. �It's not worth much to me at that point.� Low-cost CDs have affected the refurb market in much the same way they've impacted the ATM market in general, Alderman said. �They've driven the price down to nothing. I've got to do more business to keep the same revenue stream going.� Alderman said he has managed to appeal to ISOs and other off-site deployers by offering them �applications the cash machine people haven't addressed,� such as through-the-wall, walk-up or drive-up ATMs.