Used Machinery: What’s it Worth?
The demand for used equipment rises as firms and manufacturers recover from the COVID-19 impact.
Although new machinery carries a considerable competitive edge over its predecessors, many firms this year have chosen to opt for used machinery.Recovering from the dramatic impact that COVID-19 has taken on the industry, it only makes sense to tread lightly. The majority of the firms located in the North American and Middle Eastern region are resorting to used machinery for this reason. Considering the financial aspect, investing in rental services and used equipment over brand new seems to be the safest best in terms of smart budget allocation.
With that being said, the demand for used machinery doesn't just end there. This practice has been a trend for over the past 6 months, as it carries a multitude of benefits to the user. This is prevalent not only in the engineering sector but also in the agricultural and mining industry. Several rental and buying companies such as Machinery Gate have opened up their channels to accommodate opportunities to invest in safer yet equally adequate transactions for used equipment.
4 Benefits of Investing in Used Machinery:
As many recover from the COVID-19 eclipse, there has been a slow yet sure emergence of newer projects, especially within residential and commercial developments. New housing developments show demand for construction equipment. However, market trends forecast an obvious rise in oil prices, which may be the main point of concern for many. Due to this, it is only efficient to cut back on making large investment projects that may be short-term, or firms who commit to these developments for the sake of seasonal opportunity. By investing in used or rental equipment they can invest in other opportunities that may be more beneficial in the long run.
Shortage in New Inventory:
COVID-19 has taken a toll not only on buyers but also manufacturers. Due to the shortage of resources and financial constraints, many manufacturers have been slow to release and produce new equipment. Although this was an issue that has been present since the Great Recession of 2008, it was further impacted last year. This proves yet another positive benefit of investing in used machinery. Adding to this, contractors are more comfortable with previous models as they believe they have a shorter lag time.
Rather than investing in used machinery, some may still find it concerning due to issues such as storage and the duration of the project. In the case of smaller firms, it is more beneficial to invest in rental opportunities as many sellers are now offering flexible contracts along with payment methods. This allows many to grab on to opportunities without having to worry about miscellaneous concerns surrounding long-term equipment maintenance systems.
Another challenge that comes with the possession of new equipment for an entire project is maintenance and management. Due to many firms downsizing and the shrinking workforce, it can be rather risky. For this reason, technology-based maintenance programs are being frequently adopted which is also budget-friendly. Contrary to popular belief used machinery offers the same opportunities to implement maintenance technologies as newer ones and is a worthy aspect to consider.