Minimizing the risk of buying used earth moving, material handling, compaction, trucks and aerial equipment is similar to picking up a book and flipping through its chapters. The equipment brand, hours, miles and the equipment age only tell part of the story about a unit.
The chapters of its life – where it was used, how it was used, how it was maintained and who owned it – as well as external factors – current market demand for used equipment, market availability, and the way that it is sold – should all be factored in to determine a unit’s quality, the cost and your buying decision.
Let’s start with what you know: The equipment brand. When deciding which equipment brand to buy, consider whether you know how the equipment operates, if there are qualified repair facilities near your operations, and the availability and reliability of parts. Sometimes, a good deal on equipment, even if it has lower hours, may be offset by your ability to have it serviced and repaired.
Also, people are usually willing to pay more for name-brand equipment because they know it, trust it, or have had a good past experience with it. However, lesser-known brands may perform just as well as name brands. Doing your homework and getting as detailed as possible information about the equipment in order to have a side-by-side comparison helps you to better determine the equipments’ value.
Now, let’s go through the other chapters of the equipment life. We’ll start with who owned the equipment, as this can determine the other factors about the equipment’s story.
If previously owned by a rental company, there is a high probability that the equipment was maintained to or better than manufacturer specification. In order to keep equipment under manufacturer warranty, it must have periodic and documented maintenance, such as scheduled oil changes, diagnostics and testing, parts replacements, lubrication and inspections.
Contractors with a dedicated maintenance operation, or that use a dealer or other qualified businesses to service and repair equipment typically maintain equipment to factory specifications. Additionally, some contractors buy maintenance agreements with equipment dealers to cover maintenance and repair of powertrains, hydraulics, electrical systems, the equipment’s body and part replacements.
Why is preventative maintenance important? Not only does it prolong the equipment’s life and helps ensure reliable operation, but it also adds to the equipment’s resale value. Equipment with documented maintenance has higher value than equipment without documented maintenance because the risk of future problems and expenses are reduced.
Knowing who owned the equipment prior to it being put up for sale can also tell you how it was used. Rental companies rent their equipment for relatively short time intervals. When the job is done, the equipment is returned to the rental facility where it is completely inspected for operability, preventative maintenance is performed, repairs are made if needed, and it receives a thorough cleaning before it is rented again. Many times a rental company will service the equipment in advance of the scheduled factory requirements to ensure the next service interval doesn’t disrupt the next rental time.
Private owners try to get the most utilization out of their equipment in order to get the greatest return possible on their investment. When comparing privately owned equipment versus rental equipment from the same manufacturer year, you are likely to find that the rental equipment has a lower number of hours.
Where and how the equipment was used is more difficult to know. It can be generally assumed that the equipment was used for the purpose for which it was designed – earthmoving, material handling, carrying or lifting workers up. Carefully examine the equipment for signs of wear and potential problems, such as loose tracks and pins, fluid leaks, cracked glass and repainted areas to cover major body damage. Check the tires and tracks for excessive wear. Operate the equipment to get proof of its condition and its ability to perform the tasks that you need it to. Factor in repairs and parts replacement you’ll need to make on the equipment when considering your bid price.
Finally, ask for the equipment’s maintenance and repair records, history and proof of ownership. This will help you determine whether to invest in the used equipment or look for another unit.
Once you have decided on a unit, factors that are completely beyond your control will also influence the cost: market demand and the economy. When you decide to buy equipment you are competing in a world marketplace.
Other regions of the world go through different economic cycles and equipment demand. A buyer from a country, for example, where the construction is booming may find buying in a less-vibrant economic market is more cost effective.
During economic downturns in the U.S., equipment prices can usually be lower because there is less overall demand. Companies sell their under-utilized equipment, creating a surplus of used equipment and a buyers’ market. Typically in these conditions new equipment demand is greatly reduced as more buyers are looking for quality used equipment at a lower price.
There are a variety of factors to consider when buying used equipment. If you decide to buy equipment previously owned by an equipment rental company, look for the Neff Rental brand. We buy top-quality leading brands, systematically maintain our equipment according to manufacture specifications, and service the equipment at the conclusion of each rental.
For information about Neff Rental’s used equipment for sale, visit http://www.neffrental.com/equipment/used/ , or call 888-709-NEFF.