Most heavy equipment owners plan to sell heavy equipment before the end of its useful life. But in actuality, most heavy equipment is sold when circumstances dictate:
- at the end of a big project
- upon the equipment owner’s retirement
- to fund the purchase of more specialized equipment
- to upgrade to a newer model
Getting the best price when selling used heavy equipment depends on many factors, including supply and demand, brand recognition, marketing expertise and access to buyers. The condition of the machine also plays heavily into the final selling price. While you have no control over market supply and demand, you can take steps to maintain the resale value of your heavy equipment. Here’s how:
1. Schedule regular and preventive maintenance
Regard equipment maintenance, both regular and preventive, as the cost of doing business. Maintenance is essential for keeping equipment operating at optimum levels. During maintenance, parts with excessive wear or at the end of their life can be identified and replaced, preventing a costly unexpected breakdown during a project. As a reference for scheduling maintenance, refer to the manufacturer’s operation and maintenance manual. Plan ahead and schedule maintenance in between projects or during slow periods so productivity isn’t sacrificed. That being said, some maintenance can take place on the job, such as fluid level checks and tire pressure.
Tip: Document all maintenance, service and repairs in a log book. When it comes time to sell, make the maintenance log book readily available to the buyer. The more buyers know about the maintenance and usage history of the machine, the more willing they will be to spend top dollar on a machine that has been properly looked after.
2. Buy equipment from reputable manufacturers
Some equipment manufacturers are synonymous with top-of-the-line heavy equipment. Think Bobcat, and the ubiquitous white and orange skid steer comes to mind. Think Caterpillar and almost every type of heavy equipment – from hydraulic excavators to motor graders – comes to mind. Heavy equipment manufacturers such as Bobcat and Caterpillar have a long tradition of producing equipment that has stood the test of time.
Equipment from reputable, top-tier manufacturers, such as Bobcat and Caterpillar, will always be more attractive, both in a weak and strong market. Even if the market softens in a particular region, a seller of top-tier equipment will have the option of selling in another region where the market is stronger. Sellers of equipment with little brand recognition or brand recognition restricted to a particular geographic area, may have a much harder time getting a good price for their equipment in the same situation.
Tip: Keep literature from the original manufacturer organized in a protective binder or cover, including manuals, guides and even the original invoice of sale. Make that information available to prospective buyers.
3. Respect the equipment and its intended purpose
In other words, use the machine for the job it was designed. Always follow the manufacturer’s guidelines, including load capacity. Confirm that equipment operators are familiar with and will adhere to manufacturer guidelines as well. Only allow properly trained operators to use equipment. Misuse and abuse are two reoccurring players in rapid equipment depreciation.
Extreme weather can take its toll on equipment, damaging internal components. Avoid operating machinery in extreme weather, but if you must, ensure you’ve taken the necessary precautions to prevent damage. Follow the manufacturer’s recommendations for preparing equipment for use in extreme weather conditions.
Tip: Invest in a cover to protect the operator’s seat from grease or sharp items that could tear the seat. Equipment operator seats are not the most expensive heavy equipment component to replace, but the condition of a seat can say volumes to a prospective buyer about the equipment’s overall upkeep. If the seat is damaged, making operation uncomfortable or unsafe, have the seat recovered or order a replacement. Buyers of heavy equipment, particularly owners/operators, will hesitate to make offers on equipment promising 8-12 hours of discomfort.
4. Let the experts have a look
Take your cue from Walmart. The retail giant makes it widely known that its heavy trucks are only repaired at authorized service centers. If a fleet truck breaks down, Walmart dispatches the truck to an authorized service center to ensure only factory-trained technicians work on the truck and that only OEM parts are used. If you have a reputation of looking after your heavy equipment, like Walmart does, make sure prospective buyers are aware of this. Buyers will likely pay more for equipment from an owner with a solid reputation for maintaining equipment, rather than buying equipment from sellers with a reputation for spotty equipment care.
Tip: Keep a record of all work orders for each vehicle. When it comes time to sell, make the documents available to the prospective buyer.
5. Make sure your equipment looks as valuable as it is
A dirty exterior and a well-worn interior can knock thousands off the value of a piece of heavy equipment. Make sure the exterior of the machine is regularly cleaned, not only to keep it looking good, but to make it easy to see any small cracks or damage in need of attention. Regularly clean the interior as well. When given the choice between similar makes and models of equipment, with similar hours on the meter, buyers will typically choose (and pay more for) a well-maintained, freshly-painted piece of equipment.
Tip: If you’re selling through Ritchie Bros., consider having your equipment painted, repaired and refurbished before it’s listed in the auction, or posted for sale on EquipmentOne.com.
The condition of your heavy equipment – shiny and new or previously owned and gently used – comes heavily into play when you decide to sell. If you are looking towards the future, when you may want to sell, make sure you take the necessary steps to maintain the value of your equipment over the long term in order to get the best selling price possible.
Planning to sell used equipment?
Read our blog article: 5 tips for getting the best returns when selling equipment.
If you have used equipment or trucks to sell, consider selling at our unreserved auctions. Our auctions connect sellers with buyers located around the world, ensuring sellers get fair market value for their equipment on the day of the auction. Equipment owners in the USA can also list their equipment for sale on Ritchie Bros. EquipmentOne, a secure online marketplace for private sales.
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