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OEM, Rincon come together to save Carrier $10 Million


The Overview
Rincon brokered a consignment deal between a customer, one of the largest providers of voice, data and Internet services in the U.S. and the second largest seller of routers and switches that saved the client millions of dollars in their non-strategic capital budget. The deal included the generation of a substantial Rincon trade credit in exchange for a small lot of equipment that was being warehoused by the customer with no plan for future deployment.


The Details
Familiar with what the customer’s network looks like today, and knowing what they wanted their network to look like tomorrow, Rincon identified key network components the customer needed as a stop gap until the next generation routers from their provider became available. Rincon pitched a proposal for how the customer could earn Rincon trade credits and use them to obtain the equipment they needed which Rincon would purchase as part of an existing consignment program with a separate partner at a significantly discounted price. In return for Rincon buying cards sitting unused in the customer’s warehouse, the customer netted nearly three quarters of a million dollars in trade credits which could be used to purchase the routers they needed. In an unprecedented arrangement, Rincon was able to help their customer identify and propose a deal with the supplier that included more than $1 million savings per unit and only a nominal charge for recertifying the equipment. As part of the recertification process, the supplier fully vetted the equipment, tested the units, updated them with current generation software, and furnished them with a warranty and maintenance contract.


The Results
The customer earned $700,000 in trade credits with Rincon in exchange for 100 surplus line cards that could be used towards the purchase of additional equipment from the any supplier and received 10 state-of-the-art, fully loaded, fully configured chassis from the secondary market discounted by more than $10 million for Rincon.


Why Rincon?
Rincon leverages its secondary market expertise, world-class operations, intellectual property including proprietary software and other internal tools, and utilizes ISO and Six Sigma methodologies and processes to successfully identify, negotiate, and pass on savings to clients through consignment and trade credit opportunities.