Equipment costs for industrial and heavy machines can quickly eat into your profit margin if you let it. Depending on your industry and the scale needed, it's not unusual to spend upwards of $1 million on heavy equipment.
There's a better way to obtain the necessary assets for your operations.
You can save thousands by buying new or used equipment at auction. Buying used machines or industrial surplus online through an auction website provides you with the equipment you need to run your business at a fraction of the cost of buying elsewhere.
Here are six auction benefits for companies in the oil and gas, cannabis, and industrial industries.
1. Lower Prices and Better Bargains
Perhaps the biggest benefit of buying used equipment at auction is that you can find some amazing deals. The machines are listed at significantly lower costs.
Companies that no longer need or outgrow their machines may sell the industrial equipment online. Additionally, many companies sell surplus equipment online to free up inventory room at discounted prices.
You can find many parts in like-new condition, as some may have been barely used.
Buying online at an auction is less capital intensive and has a lower impact on your cash flow as you can find significant bargains. Plus, some listings also offer the option of OBO (or best offer), which gives you the option of negotiating and securing an even better deal.
2. The Ability to Ask More Questions
Finding the parts and machines you need requires doing your research and asking the right questions. You'll want to inquire about the warranty information, what it was used for, why they're listing it, the age of the equipment, etc.
The more you can find out about the machine for sale, the easier it is to determine if it's the right fit for your needs. Make sure you ask about all the features. You want to find equipment that can handle the scale of your operations.
You can buy online through the auction website and browse all the listings and contact the seller to learn all the information you need from the comfort of your home or office. You can even filter by used or new and by condition rating.
3. Avoid the Initial Depreciation
Depreciation is another factor that affects your profits, and it's unavoidable. Heavy and industrial equipment depreciates in value as soon as you purchase and use it.
However, by picking up equipment at auction, you're skipping that initial depreciation. After the first drop in value, machinery tends to maintain its worth for a few years. Maintaining the equipment and documenting service and repairs will help you slow the value of depreciation.
You can even get a better price when you turn around and sell it in the future if you follow proper maintenance schedules and document repairs.
4. Receive the Equipment Faster
Used machines are already available, meaning you can obtain possession of it much faster than buying new ones. Newer equipment has longer lead times.
Supply chain disruptions have a domino effect on this timeline as well. Last year, equipment lead times stretched out to 18 months or longer for certain parts and industries.
And not all companies have bounced back following earlier supply chain issues. In fact, many have switched to a just-in-case model of sourcing. Over half of US companies predict more obstacles in 2023.
Even without outside factors affecting the timeline for new equipment, the standard waiting time is between three to six months. However, it might only take a few weeks from purchase to installation when you buy equipment at an auction.
Faster installation means an increase in production speed and capacity, which is great news for your bottom line.
5. Online Auctions Let You Bid From Anywhere
You have a lot going on, and it isn't always possible to leave and attend in-person auctions. However, buying online provides a great deal of flexibility.
You can bid from anywhere, as long as you have a computer or device that's connected to the internet. You also have the upper hand when it comes to knowing what you're bidding on. You have plenty of time to research the auction in advance, learn about the machines being listed, etc.
If you've never bid online at an auction before, you'll want to learn about the process. Research how to place a bid, decide your bid amount and payment method, and learn about equipment retrieval. You'll also want to calculate any additional costs, such as shipping.
If you have any questions about the process, simply reach out to the auction company. Since it's online, you'll have plenty of time to prepare for the auction, and you can go into it confidently.
6. Find Quality Equipment for Less
People naturally perceive higher prices as a sign it's better quality. However, that preconceived notion isn't always true.
When you buy from a reputable auction company, the parts and machines listed have been visually inspected by trained experts. You can go to a listing and learn about the machine's condition, capacity, efficiency, whether it's missing parts, and more.
In other words, you're not going in blind. You'll have a good idea of the state of the equipment before placing a bid.
Companies may sell equipment for various reasons, such as recovering capital. In many cases, you can find like-new machines or even brand-new equipment online. You'll still find amazing deals at an auction, obtaining high-quality assets for a fraction of the cost.
Find Great Deals on Used Equipment
You don't have to break your budget and cut into your profits if you buy used equipment at an auction. It's one of the best ways to find used, like-new, or even new assets.
Take a look at Fuelled's active and upcoming auctions to find various types of equipment for all industries at excellent prices.