The good and the bad…..
There are a number of things to evaluate when you are seeking to purchase a new or used piece of machinery for your business. Though the “new truck” smell, or the shiny bumpers or chrome are quite appealing, most business owners are more realistic when purchasing something that is after all…..for work. New equipment is often viewed as “better” because it is new, but there are a few factors here to consider about THIS type of purchase
- Most of these machines are designed for harsh/rough conditions and are made of some of the toughest materials around. Age (within reason) of the machine is not really a huge factor as long as mechanically it has been well maintained.
- The majority of these machines WILL be beaten on, due to the types of work that they were designed for. Why do you need fresh paint? Its just going to wear off in a month anyway.
- One word : Diesel. These engines will run forever essentially, so why pay so much more to get one that is a little more shiny. Though there has been progress in the diesel engine world, we are essentially running the same engines as 20 years ago, with a little more efficiency.
Why Buy Used?
The marketplace right now is literally FLOODED with high quality used trucks and equipment. If you do the diligence to check into the specs of a given piece, then you will easily be able to find something comparable at a FRACTION of the cost. Here are the TOP 3 REASONS TO BUY USED
3. Immediate Depreciation
Everyone knows, to get the “New Truck” smell, you have to buy new……..then lose 20-30% of your investment when you drive it away.
I looked at a well known online marketplace for NEW trucks and searched for a well known trucker favorite, the 2016 Peterbilt 389. The base models range from 139k to 146k with the fifth wheel attachment to haul. If you were able to purchase a 2015 Peterbilt 389, you would only pay between 115k-130k. You just saved yourself $15000 for the same truck! This is even more useful if you were able to get into a 2013 Model, which would only run you around 80K.
Lesson: Save the 20% and put it into another piece of equipment. That’s 6 great trucks for the price of 5 New ones!
2. Business Agility
When you buy used equipment, not only are you saving money on high quality machinery, but you are also taking a smaller risk if something unforeseen should happen. A number of businesses today will buy a piece of machinery for a new job, then sell it when the job is finished they will sell it to someone else at little to no loss for the machine. Machinery Auctioneers works with a number of businesses this way and we find that it is a great way to grow your business without outside financing.
1. Cost, Cost, Cost
This should have been a no brainer right? Not exactly. Large companies like Walmart, or Mayflower save millions every year by purchasing new fleets of trucks and replacing older ones that are “of a certain age”. This makes total sense for Walmart because the money that they save on insuring a fleet of 2500 trucks more than offsets the cost of the vehicle itself. For the rest of us, we are going to be charged around the same for our smaller fleets regardless, which means it only really makes sense to buy Gently Used Machinery.
When purchasing equipment for your business, you could either look to smell the paint or put it to work. If you are the type that is looking to do the latter, then we want to see you at our auctions. Used vs New will save you up to 40% if only a year older, and you can expect it to hold it’s value.
We hope to see you all at the next auction in San Antonio on the 15th of March.