Dell warranty extension

[HCHTech]

I have a a client that has 4 physical servers. They are due for replacement in 9/27. It's a lot of money, so I gave them a quick "make sure this is on your radar" email last week. I heard back that they want to delay until mid-2028 since they are expecting a bunch of extra revenue from their clients at that time. I asked Dell for a quote to extend the warranties 1 more year, which I received today. It's the better part of $7K (!) for next business day, not even 4hr SLA! I mean, I guess that's gone up along with every other darned thing, but I was still taken aback a bit by the cost. Wow.

 

[thecomputerguy]

I have a a client that has 4 physical servers. They are due for replacement in 9/27. It's a lot of money, so I gave them a quick "make sure this is on your radar" email last week. I heard back that they want to delay until mid-2028 since they are expecting a bunch of extra revenue from their clients at that time. I asked Dell for a quote to extend the warranties 1 more year, which I received today. It's the better part of $7K (!) for next business day, not even 4hr SLA! I mean, I guess that's gone up along with every other darned thing, but I was still taken aback a bit by the cost. Wow.

Prices are ridiculous now. I'd imagine enterprise grade storage/RAM is heavily factored into that along with increased labor costs.

I'm having a hard time getting units out the door with decent margins. I typically always sit at 30% margin but with a desktop like:

Dell Desktop
Ultra 5
16GB Ram
512GB Storage

Running nearly $1300 my cost, there certainly is some sticker shock.

I almost feel bad pushing these out the door because they SHOULD have 32GB in them. But 32GB Crucial kits running $500 for DDR5 makes it a no go.

I'm wondering at what point does buying garbage hardware from Costco and upgrading it to Pro for almost half the cost start to make sense. I know it doesn't due to it being risky hardware but ... this is ridiculous.

I was selling:

Dell Laptop
Ultra 7
32GB
1TB

For $2,000 in December with my 30% markup. Now the maintain my markup I need to sell it for $2500, and then probably $3,000 by the end of the year.

 

[lan101]

Yeah if prices keep going the direction they are going...my area will only buy junk or refurbished business maybe lol...with memory and hard drive prices now it doesn't even make sense to repair much of anything unless it's old old stuff and they want it fixed.

I kinda miss the repair part of this work but it's about dead other than higher end hardware and maybe gaming pc's in some markets etc. But the every day computer at these prices makes way more sense to throw it away now.

 

[lan101]

For $2,000 in December with my 30% markup. Now the maintain my markup I need to sell it for $2500, and then probably $3,000 by the end of the year.

I can make a bit of money on hardware markup on some refurb stuff but on new stuff I don't even try now lol. I just show them directly how much they are getting hosed on pricing so they don't think I'm trying to rip them off. I've just had to up my rates some to offset that...about all I can do.

 

[YeOldeStonecat]

Yeah the OEM/Vendor warranties have really climbed in price over the years.....not to mention...the agony of trying to get some warranty quotes.

A few years ago we started using ScalePad...which has a few services such as lifecycle management ...and warranty extentions....at a lower cost than the vendor. They claim to use the same exact warehouse and service techs that the vendors used....I have not had to use them for a claim yet because I have so for on prem servers left.....I'll see if some of the other guys have had to have them replace something....

Customer Success Platform for MSPs | Lifecycle Manager

Maximize your existing client base with the only customer success platform built for MSPs. Protect, plan, and grow with Lifecycle Manager. Book a demo today.

www.scalepad.com

 

[Wend]

Those post-warranty renewals from the big vendors are always a gut punch, they basically price them to "encourage" you to just buy new hardware instead. I ran into a similar situation last year where the extension cost nearly a third of the original server price. If the client is dead set on waiting until 2028, you might want to look into third-party maintenance (TPM) providers like Park Place or Curvature. I've used them for older clusters before; the SLAs are usually just as reliable as the manufacturer's, but the pricing is way more realistic when you're just trying to bridge a gap for twelve months.

 

[Sky-Knight]

I have a a client that has 4 physical servers. They are due for replacement in 9/27. It's a lot of money, so I gave them a quick "make sure this is on your radar" email last week. I heard back that they want to delay until mid-2028 since they are expecting a bunch of extra revenue from their clients at that time. I asked Dell for a quote to extend the warranties 1 more year, which I received today. It's the better part of $7K (!) for next business day, not even 4hr SLA! I mean, I guess that's gone up along with every other darned thing, but I was still taken aback a bit by the cost. Wow.

Supporting aging hardware is riskier... means price goes up.
Parts and availability right now? Absolutely nuts... means price is going up.

If you work in the channel, and go do a deal registration to setup a server sale, then get it quoted from distribution, then place the order... the price quoted isn't firm until it SHIPS... and every week that goes by every server I have walking this pipeline goes up another $1000.

I have a datacenter refresh that Ingram screwed up on quoted in Feb, it's $20,000 more expensive than what the customer paid shipping this month.

Oh, and we can't return anything...

HPe doesn't stock server RAM in any configuration other than 32gb DIMMs now...
A 1.92tb read intense SSE is $4,000 COST... MSRP $12,000!

I'm doing a deal registration to sell a customer SIX SSD DRIVES! Because it's THAT expensive... it tripped the $$$ barrier.

If you think that $7k is bad, wait until you see the $40k it will take to replace the server in question.

 

[HCHTech]

If you think that $7k is bad, wait until you see the $40k it will take to replace the server in question.

It just surprised me, that's all - it's the client's money and it costs what it costs. Oh, and those servers cost $80K (to the client, my cost was less) when we bought them - haha. The big one has 4 Xeon Golds and 1.1TB of RAM. I don't even want to guess what an equivalent will cost in 2027.

 

[Sky-Knight]

It just surprised me, that's all - it's the client's money and it costs what it costs. Oh, and those servers cost $80K (to the client, my cost was less) when we bought them - haha. The big one has 4 Xeon Golds and 1.1TB of RAM. I don't even want to guess what an equivalent will cost in 2027.

$240k - $400k... depending on storage.

If you bought 5-6 years ago... double it TWICE just to get started.