Purchasing a Second Hand Computer

I wrote this booklet on things to look out for when purchasing a 2nd hand computer when I was dealing in second hand computers and laptops. There is a significant difference between buying a 2nd hand computer privately and a reconditioned computer through a professional dealer.

The professional dealer will charge more but you are paying for additional labour and warranty. The 2nd hand computer dealer will check the hardware, update any older parts, replace anything that is failing (internal fans were always high on the list), and wipe the old owners contents and re-install the Operating System on the computer as new. You would be guaranteed a virus free and trouble free computer.

A good second hand computer dealer will also load a bunch of useful free programs on the computer, saving the customer  money in the long run....

For me there were bigger margins in the 2nd hand computer market and at the time new computers still cost several thousand dollars.

I wrote this and distributed it in response to several dodgy 2nd hand dealers in the area selling for very cheap. I repositioned myself as a seller of 'as new' reconditioned computers with a 6 month guarantee

You can read more information on the Reconditioned Laptop Computer process  

Still some good advice in here, though a little outdated, here is the booklet titled...

Purchasing a Second Hand Computer

Or 

“Don't buy somebody else's problems”

- by Conan Stevens

Table Of Contents

1. Second Hand, Refurbished and Reconditioned
2. Private vs. Dealer
3. Mhz, Ram and Gigabytes ???
4. Total Cost of Ownership
5. What to look for
6. After sales support
7. Glossary of terms
8. Useful phone numbers
   

1. Second Hand, Refurbished and Reconditioned

i) Second Hand Computers

Many computers are sold as second hand, what this means is that you get the computer as is. The owner has finished with it now it's your turn. This can at first seem very convenient as the computer is setup has many programs installed and is ready to use.

Problems: The programs are often illegal copies, this can come to haunt you. Some software companies offer free updates, they then search your computer when you update disabling any pirate software, sometimes leaving your entire computer unusable. The other potential issue is that unscrupulous people will sell on a computer after obtaining a repair quote for an intermittent pro. Also be aware that an alarming number of computers harbour virii, pornographic material, international telephone diallers (how would you like to call a 0055 number in the USA?) and other unwelcome material.

ii) Refurbished Computers

This is what you typically purchase when buying from a dealer, also called recycled or remanufactured. These computers are brought back in, usually from leasing companies, then the components are tested and they are cleaned inside and out to bring them back to a good condition. All software is wiped to avoid legal issues with software and for the previous owners privacy.

Problems: As a software wiped unit these will require the operating system (often Microsoft windows), drivers (programs that tell your computer how to work), and programs (wordprocessors, etc) to be reinstalled. This will require considerable knowledge to do correctly, so remember to factor into the price the additional cost of getting somebody to do this if you are not too sure yourself. Some problems do not show themselves in basic hardware testing.

iii) Reconditioned Computers

These are machines that first cleaned and software removed as in the refurbished units and old/faulty components replaced and new parts added to bring them up to date. The original lisenced software is then reinstalled on the systems bringing them back to “like new” condition. These often come better than they were new due to the modernised parts and newer software.

Problems: As these are tested and reloaded there should be no problems with either the hardware or software.

2. Private or Dealer?

Once you decide what sort of computer you would like to buy you need to decide where you would like to buy it from. Basically there are two options as follows.

i) Private Computer Seller

Often a privately purchased computer will seem to be a better value purchase as you get more for your money, sometimes coming with a printer or scanner and a bundle of software. Care must be taken though as frequently the software is 'pirated' – an illegal copy. This can lead to fines in excess of $10,000. Currently the Business Software Association is targeting piracy in small business, this kind of fine can bankrupt many a small business. You need to ask yourself whether saving $100-$200 is really worth the gamble. Another thing to consider is if you are not given the software disks these can cost a small fortune if you later have to go out and buy them at full retail to perform repairs on your computer, for example Microsoft Windows costs in excess of $400 to purchase retail, while Microsoft Office costs in excess of $800. Also to be considered is whether that second hand printer or scanner really adds any vallue to your purchase. On the face of it it can seem a great bonus, but considering a second hand printer costs approximately $50, new ink forit will cost $45 as it will ikely be low, now factor in a new printer with a full years warranty can be had for $100. You have to remember that if the printer/scanner was good the person selling it would most likely keep it to use with their new computer (if they upgraded). Also remember that a new printer or scanner, even the cheapest, will often be of better quality than a high range printer from three years ago.

Consider also that you are likely buying someone else's problems, virii, pornographic material, malicous programs like trojans or worms. It is not unusual even with Anti-virus software to find 2-3 virii on a machine that has been reasonably well maintained, with some bad examples have over 2000 infected files.

You do not get warranty from private individuals, and even if they say there is a warranty you have absolutely no recourse if you run into problems later.

ii) Backyarders

As the name suggests these traders often operate out of their garage in the backyard. Quality here varies considerably. You get traders who know enough to be dangerous to the public to the retired technician or computer science student who can be quiet competant.

The only real advice is to meet the people and if you would not buy a used car from this person do not buy a computer from them. Excuse yourself, turn around and leave. There are many computers out there do not allow yourself to be bullied into buying a lemon.

If you can take someone who knows about computers with you.

Things to check are that the picture looks good, the sound works and that you get a professional receipt with warranty clearly stated.

Many of these people are little more than pirates, with computers coming with thousands of dollars of software thrown in with a cheap computer. This looks great at first until you realise that the computer barely runs as this software was never designed for it, automatic updates can crash you machine, and you can get fined, especially as a business. The more software loaded onto the computer the more suspicious you should be, as the people who know the least tend to be the ones who load the most programs.

Many traders tend to be cheap but beware if they are too cheap – you may not be getting what you expect. With such low margins the cheapest cannot afford to scrap a computer that has a problem, instead they will apply a 'bandaid' to get it through the sale and warranty can be very hard to extract.

Iii) 2nd Hand Computer Dealers and Shops

This is the safest option in that if you have a dispute you can always contact the Department of Fair Trading. 

3. Mhz, Ram and Gigabytes

Once you have decided from whom you are looking to buy your new(ish) computer from you then need to work out two things. How much are you willing to spend and how fast will the computer need to be to do what you want.

This brings us to the numbers, please don't make the mistake of learning a little bit then going off pretending you know what you are talking about, often you will later find the advice you get from well meaning friends is completely wrong and some snake-oil trader has played upon this to sell you a computer that is next to worthless.

Find a dealer who asks questions and listens to what you want the computer for. Listen to his recommendations, and if anything is unclear ASK questions. The ones who pretend they know everything (often because they are scared of being ripped off if they come across as knowing nothing) are the ones who will get ripped off.

The numbers and what they mean. There are three numbers you should know the meaning of when looking for a computer, by no means are these the only things you need to know, but it is a good start.

Pentium 1,2,3 or 4 and Mhz (Megahurtz)

This represents the basic speed of the computer. Roughly the higher the Mhz the faster the computers potential. This does not apply to the Pentium 4 versions though (as a rough guide subtract 300-400 Mhz to get a 'real work' rating.)

Basically the higher Pentium number the later the model and the faster the computer. Look at the following table for a rough guide to the speed you require.

WARNING – ADVANCED BIT

To really confuse matters there are other CPU types that the Mhz does not really equate to the speeds above. For example the Cyrix chip Mhz is roughly equivalent in Mhz except in running games. AMD K6 and Intel Celeron Processors are roughly 20% slower than their Pentium equivalents. AMD Duron Processors are equal in Mhz, and AMD Athlon processors are about 10-15% faster. AMD Athlon XP processors have a rating number already factored in..

RAM, Memory and MB (Megabytes)

Many people mistakenly think that the more RAM in a computer the faster it is. Nothing spells sucker better to an unscrupulous trader than a customer ringing up and saying “at least 128Mb of RAM” while not mentioning anything about the Mhz. Do this and you will get ripped off.

The amount of RAM you require depends mainly upon the Operating System you are using. Only if you run professional photographic or video editing programs will you need more than the amounts recommended in the table below.

The maximum refers to how much that Operating System can use, any more is not helping the computer and will actually slow it down. Microsoft actually claim much lower minimums, these recommendations above are based not upon what will run, but upon what is usable.

Gigabytes and Hard Drive space

Gigabytes refer to the amount of storage space your computer has, imagine it to be like a wharehouse where information is stored until needed. The more programs, and the more modern the programs you run the more space you will need. Below is a table with some recommendations.

4. Total Cost of Ownership (TCO)

When many people go out to buy a computer they look at the purchase price and often ring around and then buy the cheapest. In these tough economic times this seems like a good strategy. Let me explain the concept of TCO.

This is a measure of the cost of the computer over it's life span. A simple analogy would be to compare a second hand family car costing $15,000 and a second hand 4WD for the same price. Initially the 4WD may seem like a bargain, more room for the family, beach outings, safety, etc. Then comes time for insurance, rego, and the ongoing petrol costs. Over the life of the car the 4WD will end up costing a lot more to run. This same concept should be factored into your computer purchase.

Often a cheap initial purchase will end up costing more than initially anticipated as repair costs and maintenance bills mount.

Some of the costs to factor in are:

i) Warranty – if possible pay a little extra for the peace of mind that the computer is guaranteed to work and you have not just wasted your money on a lemon.

1. Operating System reinstall. If the computer has software problems (virus, not setup correct, deterioration of the O/S) you are going to have to get the Operating System (O/S) reinstalled. If you have the legal CD's and license this costs approximately $110 at a computer store. If you do not get the O/S disks and license you are looking at around $400 extra for these items.

2. Downtime – how much it costs you in time to get problems fixed and the amount of time/income you can loose while the computer is inoperable..

3. Inferior components in high end computers – by placing an outdated video card (for example) in a high end second hand machine at a casual glance everything will seem fine, that is until you try do anything graphics related. This cuts intial purchase price and can help make a sale based on price. These sorts of components will have to be replaced.

4. After sales service. Look into whether standard repair and maintenance is available after purchase and whether the computer has been setup in such a way as to help minimise labour costs involved in servicing the machines. Only truly professional businesses will consider this at sale time.

These are just a few of the things that can influence the Total Cost of Owning the computer. Remember to measure not only the money but also the time and possible frustration that may also need to be factored.

Like many things in life often the cheapest can turn out to be the most expensive. Consider spending a little extra at time of purchase and think of it as insurance.

5. What to look for

8. Glossary

Hardware – the parts of the computer that you can physically touch

Software – the programs that run on the computer allowing you to surf the web, do wordprocessing, spreadsheets, play games, etc.

Operating System - often a flavour of Microsoft Windows defined by the year it was originally released. Other popular operating systems include MacOS for Apple computers and Linux for advanced users. The operating system allows the user and programs to communicate with the hardware.

Drivers – the individual programs that run in the background that allows devices like your video card, sound card and modem to work correctly.

Trojans -

Worms -

Virii – the plural of virus, ie “You wouldn't believe it, there were 45 virii on his computer!”

Virus -

Modem – the hardware part of the computer, either internal or external to the case, that allows the computer to communicate with the Internet.

Internet – a large collection of computers attached together to allow data transfer at high speeds. Includes but is not limited to the World Wide Web (WWW), E-mail, etc.