Although there a few exceptions, you are can expect to spend less buying used industrial equipment compared to a new piece of equipment. The difference between the price of a used one and a new one is usually between 30 to 70 percent. The price difference is mainly determined by the condition and quality of used equipment. You will notice that most machines are cheaper when you buy them used.
Minimal Lead Times
When you buy a machine from a machinery dealer or OEM, it is normal to face inconsistent and long lead times. This could be because of many reasons, like the OEM not having certain materials or parts on hand, not having enough staff to ensure order deadlines are observed, or even shipping delays.
Used industrial equipment is usually available almost immediately. This means you will have possession of the equipment in no time. You have to wait for a longer time to get a new machine. If you are buying used industrial machinery, the typical lead time is two to three weeks. The typical lead times for new ones can be up to six months.
Depreciation and Resale Value
Most of the machinery and industrial equipment will see the highest depreciation in the first 12 months after the sale. The equipment or machinery is going to get an initial 20 to 40 percent drop in value then it starts to stabilize. If the equipment or machinery is properly maintained, it is going to remain with the same value for at least five years. You can learn more from the IRS who have a property depreciation guide that will help you.
Because the industrial equipment or machine doesn’t lose much value after the first year, you can sell it again for a price that you bought it for.
Considerations You Need to Make When you Buy Used Industrial Equipment
Source
Find as much as possible about the seller. There are things you need to know to ensure that you are buying from a reputable seller. A good way is going through online reviews.
See what the previous buyers are saying about the seller. If there are other buyers willing to endorse the seller, it is a good sign. How many people have complained about the company or their products? Go through the complaints and see whether they are relevant to your purchase. These questions are important before you buy used industrial equipment.
Condition
Unless you want to buy the used industrial equipment to use it for parts or recycle the metal, you need to make sure the equipment is as-advertised. Once you have found a good used industrial machine, make sure it works properly.
The best way of judging whether the equipment is in good condition is to leave it to an actual operator to do it. Service records are also important because they will give you a good idea of its condition. If this is not an option, look for signs of maintenance, has been repaired, painted, or just cleaned; these signs are important because it lets you know the level of care the past owners had when using the machine.
Additional costs
Removal and Shipping
Depending on where you are purchasing the machine or industrial equipment from, you might have to pay for removal and or shipping fee. The fees are different from one seller to another. It mainly depends on the purchasing method. If the item is being sold at an auction, it might still be at the owner’s facility, and in this case, you have to pay a removal fee to the owner or auctioneer (If the owner has hired one to sell it on their behalf).
Maintenance and Repair
Just like with new equipment, you have to make sure that the used industrial equipment you have bought needs regular upkeep and service to ensure it works well. The worst thing you want to deal with is downtime because you did not properly maintain the machine.
Buyer’s Premium
If you have bought a used machine or equipment from liquidation or an industrial auction, you might have to pay a buyer’s premium. This is known as BP and it is the additional charge that a winner has to pay on the lot’s winning bid. If the buyer’s premium is 10%, you have to pay 10% more on top of the buying price.
