When companies come to the conclusion that it is time to purchase new equipment, there are always a couple of different options that could work such as leasing, buying new and buying used equipment. The route that a company chooses can affect their operations’ efficiency for the foreseeable future!
While a majority of companies will lean towards purchasing new industrial equipment for their needs, used industrial equipment from equipment auctions is really the best option! This is because equipment is made to last for years, even decades.
With this in mind, these are the questions to ask before bidding at any equipment auctions and the top advantages of purchasing used industrial equipment from said equipment auctions.
Questions to ask before bidding
This is an internal company question that should be answered before a company starts bidding at an online or in-person auction. If jobs are not being completed, are slower than normal or are on hold due to equipment that cannot simply be repaired due to its current value, then it is time to purchase some different equipment.
At Lyon Auction, we recommend used equipment from our online or in-person auctions because our company goes through a rigorous process to ensure that all equipment is performing and maintenance logs have been completed, along with other important aspects, which means this equipment is just like new and cheaper!
2. Do you work with transportation companies?
Don’t let this be the last thing you think about because no matter what, you have to get the new equipment back to your company or work site somehow. It is worth looking into to see if the company that is holding the auction has third party transportation partners who you can work with. The last thing you need is to delay any more time because of a lack of shipping.
If this piece of equipment is specifically being used for a single job, and there is no possibility of this type of job again in the future, it is best to rent a piece of equipment. On the other hand, if this equipment is going to be used frequently, it is worth the investment into the company to purchase used or new equipment.
4. Do you have the resources to maintain it?
Different equipment means different maintenance is required to ensure that it runs at full capacity. Make sure to have a professional on hand to maintain the equipment if need be.
Once all these questions are answered and you have ensured that you have transportation and the needed equipment in place, these are the biggest advantages of purchasing used equipment from equipment auctions.
1. Lower cost
It is generally cheaper to purchase used industrial equipment than to purchase a new piece from the manufacturer.
Here are some great examples of how it could be cheaper to purchase used industrial equipment or any other type of equipment versus purchasing new.
Depreciation of used equipment is similar to purchasing a used vehicle. Depreciation is valued at its lifespan - if a piece of equipment was purchased at $100,000 and its lifespan is about 20 years, you would calculate the annual depreciation by 12 months! It is estimated that depreciation happens in the earlier years of the piece of equipment, and the older it gets, the less it will depreciate.
This is something to consider when purchasing equipment, and for any company who is worried, here is a calculator to predict the depreciation.
The thing with auction companies is that once you are the final purchaser on that product, that piece of equipment is yours as-is, and the transportation company you have been working with will bring it to your company! Depending on the location of the auction, you could get it the same day!