Used Fab Equipment – Two Lessons from the Trenches
June 21, 2018
No third-party company is qualified or equipped to provide customizations to our equipment without training and authorization from us. This leaves third party companies only able to do superficial customizations that have many unknown consequences to the ultimate performance of the system.
We recently published a post – Removing the Risk When Buying Used Fab Equipment – that explained the demand for used equipment and your options for acquiring it. One of those options for used fab equipment is third-party vendors and brokers, but buyer beware… there are some cautionary tales that might give you pause.
Erik Hanson, Director of Refurbished Products at FormFactor, tells the tale of an actual purchase of a wafer probe station from an online marketplace: :
The tool was sold by an online merchant for $25,000. The customer, a high-end semiconductor device designer and manufacturer, was looking for a tool for their Failure Analysis group. The tool was non-functional when it arrived at the customer site, so the customer spent an additional $2,500 with a third-party service provider to get the system up and running. Unable to successfully get the system running properly, they contacted our company (Cascade Microtech at the time) – and we provided updated control hardware and software, as well as other components to replace those that were not well maintained by the previous equipment owner. After paying an additional $15,000 for necessary parts and service, the system was restored to full functionality. At the end of the day, the total out-of-pocket cost for the tool was $42,500.
Had the customer come directly to us, the required replacement parts would be included as part of the standard certified refurbishment process. The price for a similarly equipped certified used system purchased directly from Cascade Microtech would have been approximately $32,000 and would include our standard warranty. The customer actually spent $10,500 more than if they had gone directly to us, and could have avoided the headaches incurred. Additionally, the customer lost opportunities, time, and revenue while the tool was not operational.
Another more recent example drives the risk of third-party providers home and further shows the value of considering the OEM option. In this particular scenario, we had a customer in Europe go to a third-party refurbisher for a probe station acquisition. Once the PA200 Probe Station was delivered, they had to immediately contact us. There was damage during shipping that prevented it from working. Our field technician visited the customer site and determined that it could not be repaired on location. Instead, it had to be either shipped back to FormFactor for repair or purchased for a nominal cost and replaced with something that works.
The customer purchased the probe station for $55,000 and thought they had a good deal, but with the cost of repairs the end cost of the product ended up being $105,000, not including downtime. They could have purchased the PA200 from us at $85,000 and they would have our SourceOne program benefits and eliminated their risk. No third-party company is qualified or equipped to provide customizations to our equipment without training and authorization from us. This leaves third party companies only able to do superficial customizations that have many unknown consequences to the ultimate performance of the system.