Whether you’re starting a new business or expanding your existing one, staying on budget it key. And when it comes time to purchase heavy equipment for your business, there are three options: new equipment, used equipment or rental equipment. While the obvious benefit of purchasing brand new machinery is knowing it will be in top working condition, the sticker price can scare off many buyers. That’s why so many business owners, whether they’re in agriculture, construction or transportation, turn to used equipment dealers to find the best price. While you may be tempted to go the rental route to get the newest equipment without the hefty price tag, in the end, the smartest move is purchasing used equipment. Here’s why:
1. It costs less
Obviously, purchasing something used is going to cost a great deal less than something brand new. Depending on the condition of the used equipment, you can spend up to 70% less than you would buying new. Because of that, business owners can afford to purchase a higher caliber of machine than they’d be able to otherwise.
2. It doesn’t immediately depreciate
Much like buying a new car, the second you roll off the lot with your new piece of equipment, the resale value plummets. After the first year, a new piece of equipment’s resale value will take a nosedive, losing 20-40% of their value. After that, as long as everything is properly maintained, the value remains relatively stable. Buying machinery that is at least a year old means that not only will you save on the initial price, but your wallet won’t take as much of a hit when it comes time to sell as well.
3. It’s already been road tested for you
When you purchase a new model of equipment, you’re taking a gamble. You’re hoping that the machinery will be able to perform everything that’s advertised and will last a while. However, recalls and other issues can always come up. With used equipment, you don’t have to worry about whether or not it will perform, because a previous owner has already tested it. Used equipment is inspected and valued before hitting the market, and if the machinery is in poor condition, the price will reflect that.
4. It lasts just as long
While you may think that used machinery will break down as soon as the ink dries on your sales receipt, it’s been proven that used machinery lasts a surprising length of time, in some cases, decades. Used machines also have the reputation of being able to produce the same results as new with very low maintenance costs.
5.You won’t wait as long
With used machinery, you can get in, get what you need and get back to work easily. However, there are a few factors involved in purchasing new equipment that could have you losing a lot of the precious time that you need to be able to make back the money you spent. Not only can delivery times have you waiting weeks before you can start using your new buy, but control systems can change from year to year. That means spending time making sure your workers are comfortable with the machinery.