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Accenture helped Optus set up an asset disposal program to help them generate additional revenue, save warehousing costs and better manage risks in the future.
Optus, a wholly owned subsidiary of SingTel Group, is one of the largest telecommunications company in Australia. Every year, the company invests millions of dollars to upgrade the network over which their services are delivered. As Optus purchased new network-related equipment, they were also decommissioning assets that had become obsolete.
We helped the company put in place a sustainable asset disposal program that helped generate in-year cash benefits of just under AUD$3 million, through the resale of reusable assets and the recycling of obsolete equipment.
Find out how this program helped Optus unlock a new revenue stream, as well as enhance the company's position as a sustainability leader.
Over the years, Optus had accumulated a significant inventory of modems, routers, base stations, switches, peripherals and other equipment that they no longer needed.
The outright storage expenses associated with warehousing these assets were significant, as was the amount of capital locked up in old equipment that could otherwise be used to grow the business.
Optus estimated that it could save up to 25 percent in storage costs and generate additional revenues by selling or otherwise disposing of its decommissioned assets, some of which had been stored for 10 years or more.
The company wanted to implement an asset disposable program that could not only unlock new revenue streams, but also increase their capability to safely dispose of the assets.
We brought in a group of onshore operations strategy consultants and offshore professionals from the Accenture Strategy Capability Network to carry out a comprehensive due diligence exercise to:
Categorize the company’s assets for sale or recycling
Conduct market research and issue requests for information to assess market demand for the assets
Identify assets that could be offered on a competitive sales or exclusive sales basis
The resale market is fragmented—thus, it was critical for our team to collaborate with a variety of potential buyers. A Mandarin speaker and a Polish speaker were brought on board to tap into regional markets.
Nearly 120 buyers expressed interest in purchasing Optus’ assets, and we worked closely with the company’s supply chain and engineering professionals to:
Revenue from the asset sale and disposal has helped Optus unlock funds that they can reinvest in other parts of the business. It allows the company to set itself apart with a much more dynamic inventory operation—effectively managing inventory fluctuations and actually capitalizing on volatility in the second-hand equipment market.
As a result of the project, Optus:
Generated in-year cash benefits of just under AUD$3 million, through the resale of reusable assets and the recycling of obsolete equipment.
Relied on targeted and highly competitive negotiations with a select group of buyers—resulting in sales outcomes that were 300 percent higher than the original offer pricing.
Liquidated a large volume of old inventory that has helped Optus shut down one of its warehouses.
Apart from the commercial benefits, this program has encouraged the reuse of assets—thus, assisting the company’s sustainability agenda.
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