Get rid of it!
After being assigned the responsibility of surplus property disposal for my agency many years ago, I quickly came to the following conclusion: it is often easier to buy something than it is to get rid of it.
Some in the public procurement profession may not consider surplus property to be a glamorous assignment. In fact, the first time I was given this role was at a procurement staff meeting that I missed. My colleagues in attendance told me that, due to my absence, I “volunteered” for the role.
But today we can absolutely view property disposal as a key function for any organization. Since it is often considered part of the warehousing function, it falls under the authority of central procurement for many public agencies. Even if your own agency is structured differently, it is still important that a public procurement professional be aware of surplus property policies.
Disposing of assets in an opportunity to bring value (and dollars) to any organization. Knowing how to maximize the value of surplus materials and equipment can really pay dividends.
So what is the best method of disposal? Similar to buying the item originally, there is no single best method. Just like we have options with procurement methods (bid, RFP, sole source, etc.), there are also choices when it comes to disposal.
Trade-in can be a viable way to dispose of things like heavy equipment and fleet vehicles. It will offset the cost of the new equipment while getting the older units off your hands. Unfortunately, dealers may tend to under-value your used equipment in this scenario, even as part of a competitive bid process. It may be wise to keep your options open and state that your agency may or may not accept their trade-in offer.
Many organizations do quite well selling their surplus equipment themselves, either through a competitive bid process or through the use of online sales. The latter has gained popularity in recent years as companies like GovDeals and Public Surplus have increased their presence. The equipment is offered to a broader network of potential buyers, and through increased competition comes better prices. Even after paying the agreed upon commission, I have still found online sales to be a great value for my organization.
Donation may be another option to consider for your surplus item. If allowable, just giving your surplus furniture to a local non-profit can make sense. Perhaps a homeless shelter or community center could put the furniture to good use?
Normally, agreements between two public agencies can be negotiated directly, including the sale of surplus equipment. For example, a used fire apparatus from a large city can be sold to local fire district. Even if the large agency could get a higher price elsewhere, it could still result in a win/win for the parties.
Managing the disposition of surplus property is an important part of public procurement. If this opportunity happens to come your way, my advice is to embrace it. Determine which disposal methods are in your “tool box” and go out and make a difference.
DARIN MATTHEWS, FNIGP, CPPO, CPSM, is the director of procurement for the University of California, Santa Cruz. He has extensive management experience, speaks throughout the world on procurement issues, and has published several books and articles on supply chain management. Contact Matthews at [email protected]