Buying Second-Hand PC May Be a Smart Move

Now that personal computers have been around for a few years, we’re seeing a market for used equipment. Turn to the classified section of most local papers, and you’ll probably see a special section featuring personal or “home” computers. Attend a meeting of a computer user group, and you’re likely to find members swapping used equipment. Some areas have occasional “computer swap meets,” and some cities have stores specializing in used computers.

People sell used equipment for a lot of reasons. Sometimes they’re getting rid of something that they never should have bought in the first place, such as those $199 specials that never could run the business software they needed. Others are merely upgrading, selling off the old to raise money for the new.

Buying a used computer can be a smart move. Ed Kahn and Charles Seiter, in their new book “The Skeptical Consumer’s Guide to Used Computers” (Ten Speed Press, $9.95), argue that “used is better.” Computers have very few moving parts. The silicon chips don’t wear out. Instead, they “burn in.” If a computer has been running well for years, the chances are very good that it will continue to do so. New systems are actually more prone to failure than used ones. That’s why some dealers, before selling a new computer, will let it run for a few days to burn in the chips and make sure that everything is in good working order.

You do need to be careful with used disk drives and printers. They have moving parts that are subject to wear and misalignment. Display screens, like TV sets, can wear out or become blurry.

Many computers, including the IBM PC, come with easy-to-use diagnostic programs that allow you to check the memory chips, keyboard, disk drives and other components. Repair facilities usually have more sophisticated diagnostic software and equipment, and most will check a system for a modest fee.

Be careful about buying used equipment made by a company that is out of business. If you’re considering such a system, check to see whether a national service organization has agreed to stock parts for at least five years. TRW, Bell & Howell and Xerox provide such service for many brands of computers.

If you’re a seller, consider offering some extra value to attract buyers. Unless you’re planning to replace your machine with a compatible system, the software may be of little value to you, so you could include it at no extra cost. And selling used software on its own is often more hassle than it’s worth. Make sure you include only the original program disks along with the manuals. You can be prosecuted for selling unauthorized copies of copyrighted software. Buyers should be aware that some software companies refuse to provide advice or upgrades to buyers of used software. When in doubt, call the software company. Some allow you to transfer the registration from the original owner.

Offer Free Training

Sellers can also offer to deliver and install the system and provide the buyer with free training and phone support. That’s more than most dealers offer and may help clinch a sale, especially if the buyer is a novice. A good used machine with software, installation and support may be a better deal than a bunch of boxes from a dealer or mail-order house.

Whether you’re buying or selling, the hardest thing is to figure out a fair price.

First, determine the equipment’s condition. For maximum resale value, it should be clean and in perfect working order. All the boxes, manuals and software that came with the machine should be intact.

Consider whether the machine is a current model. In most cases, people are willing to pay more for a current model than for one that has been discontinued. That doesn’t mean that a discontinued model is obsolete. The Apple II+, which has been replaced by the Apple IIe, is an example of a viable used machine that can run an enormous amount of software.

Check the Ads

If the machine is a current model, first find out what local dealers are charging. Then check the ads in computer magazines and your local papers for discount prices on new equipment. Be sure to compare component for component. You should account for all the plug-in or add-on equipment.

Finally, check out the used market itself. Look at other people’s classified ads, talk to people at computer stores or attend a user group meeting. If you have access to a computer with a modem, dial up some computer bulletin boards or an information service such as The Source or CompuServe for used-equipment ads. The Computer Shopper, published in Titusville, Fla., carries hundreds of classified ads from throughout the country.

There are two publications, similar to the used-car market’s Kelley Blue Books, that list prices for new and used computers. The Brown Book, published in Santa Barbara, lists suggested retail and average selling price for new equipment along with the “fair market value” of used systems. The average new price takes discounts into consideration and is often much lower than the suggested retail. The fair-market value of used equipment is based on “the average of what people are selling them for,” according to Fred Brown, the book’s publisher. An 18-month subscription--six quarterly editions--sells for $375.

Don’t Always Agree

The Orion Blue Book, which comes out annually and sells for $49.50, lists prices for new and used equipment at both retail and wholesale. Buyers and sellers interested in free price information may call Orion Research of Durango, Colo., at 303-247-8855.

The Blue and Brown books don’t always agree. Blue, for example, lists the retail price for a used Osborne 1 at $338, while Brown estimates $558.

Bill Chin, owner of the Used Computer Store in Berkeley, doesn’t use any pricing guides, nor does he have any magic formulas. “The market is constantly changing. We watch the ads and drop our prices when the prices on new equipment come down.” Chin’s store buys and sells used equipment and offers discounts on some new machines.

Chin’s store is unusual. Where car dealers encourage trade-ins, computer stores rarely buy and sell used equipment. As a result, there is no organized market for such equipment. You’re basically on your own.