Redemtech to open Reno plant

The Ohio-based company that last week chose Reno for a major new facility is growing quickly as technology companies pay more attention to getting value from their outdated gear.

Redemtech said it plans a 65,000- square-foot facility in a building at 655 Spice Island Drive.

That's part of a 164,000-square-foot building previously occupied by Arrow Electronics.

The facility is expected to be open in January.

When it opens, the Redemtech facility will handle about 250,000 used computers and other technology assets annually.

Robert Houghton, the company's president, said Redemtech contracts with large organizations that typically calculate the total cost of ownership of their technology assets a figure which includes disposal of used equipment.

Redemtech disposes of some of the used equipment, sells some, donates some to charitable organizations and places some back into use in its clients' operations.

That requires, Houghton said, that the company meet high standards to cleanse data from hard drives a requirement that has taken on more importance with new federal standards to protect health records.

The company also must meet environmental standards when it disposes of equipment.

It's not uncommon, Houghton said, for the company to maintain a list of technology standards prepared by its clients.When a used computer arrives at Redemtech facilities, company employees check to see if the computer might be used elsewhere in the client's operation.

If it can be used elsewhere, it's kept in a special inventory slot.

The five-year-old company, a wholly owned subsidiary of privately held Micro Electronics Inc., began looking for a West Coast site because about half its business comes from California, Houghton said.

Redemtech chose Reno for its major new facility because of the city's proximity to West Coast markets.

Nevada's tax climate provided a second reason for Redemtech to select Reno over California locations, Houghton said.

Technology hardware from West Coast customers has been hauled to the Redemtech facility at Hilliard, Ohio, but the company wants to reduce freight costs.

Reno, Houghton said, provides good transportation connections to nearby California markets.

That, in turn, may boost the company's ability to put more equipment back into use at clients' operations.

A major customer agrees.

"We're pleased with the reduction in freight costs and we expect those reduced costs will allow us redeploy assets back into our system more frequently," said James Regan, manager of facilities for a West Coast-based healthcare organization that's a Redemtech customer.

Regan said, too, the Reno facility will allow his organization to get used technology onto the market as much as two weeks more quickly.

Timing, he said, can be critical in selling used equipment for its maximum value.

Because technology equipment depreciates at an average rate of 6 percent a month, Redemtech encourages its customers to dispose of used equipment as quickly as possible rather than gathering a batch and sending it off occasionally.

The new Reno facility will employ about 25 people when it opens, Houghton said, and that figure is expected to double within six months.

After that, employment growth will depend on the market, the Redemtech president said.

The company's Ohio facility runs a six-day, three-shift schedule, and Houghton said that's possible in Reno as well.

The company will be installing equipment and warehouse racking in the Spice Island Drive building during the next several months, but Houghton said little structural work will be required.

Redemtech expects the equipment installed in the Reno facility will allow it to further trim its costs.

Eric Vetrano, the company's vice president for operations, said the layout will accommodate in-line processes rather than bench-based work.

This means faster turn-around and higher efficiency.

"The Reno facility will allow us to increase the overall capacity, thus allowing for for quick ramp-up while maintaining quality," Vetrano said.

Redemtech uses a propriety, Internetbased sorting system to keep track of used technology equipment as it enters its facilities and make decisions about where the equipment is headed.