
With the recent downturn, it has become a buyer’s market for used equipment. Businesses have been selling their unused equipment to recoup, and equipment vendors are more eager than ever to move their inventory, which is why equipment values are less than 20-30% than even 30 days ago. Even auction values have dropped significantly and many pieces of equipment at auction are going 50% under market. The economic downturn has left many businesses questioning what to do next. If you want to play your cards right, use this new market to your advantage by adding the equipment you need for the long term and use the depressed equipment prices to build additional equity in your company.
With the recent downturn, it has become a buyer’s market for used equipment. Business have been selling their unused equipment to recoup, and equipment vendors are more eager than ever to move their inventory, which is why equipment values are less than 20-30% than even 30 days ago. Even auction values have dropped significantly and many pieces of equipment at auction are going 50% under market. The economic downturn has left many businesses questioning what to do next. If you want to play your cards right, use this new market to your advantage by adding the equipment you need for the long term and use the depressed equipment prices to build additional equity in your company.

If you have a long term need for equipment, here are some cost-reducing methods to consider:
1) If equipment is listed with a vendor, offer 20% below asking or more as a starting point for negotiations. Many vendors pay monthly costs on their inventory and will negotiate a lower price to avoid a large bill the following month.
2) Look for auctions in your area. Make sure you get approved before attending the auction so that you can maintain buying power. The closer the auction is to you, the less time you will likely wait to get the equipment installed.
3) If the equipment is a truck or titled piece, and coming from a private individual or company, get the front and back of the title before negotiating the price. If the seller isn’t willing to provide the title, they will be difficult to work with and likely won’t be motivated to make a sale.
4) Used, non-titled equipment from private sellers requires lien searches. Liens are the legal rights of a creditor over another’s property. If you plan on buying that property, you must conduct a lien search to ensure that the asset you are buying doesn’t stay under the previous creditor. You don’t want the IRS or a bank to repossess your equipment if the liens weren’t properly released. (ACG takes this step for all our clients and works out the details with the seller to protect our clients.)
If you have a long term need for equipment, here are some cost-reducing methods to consider:
1) If equipment is listed with a vendor, offer 20% below asking or more as a starting point for negotiations. Many vendors pay monthly costs on their inventory and will negotiate a lower price to avoid a large bill the following month.
2) Look for auctions in your area. Make sure you get approved before attending the auction so that you can maintain buying power. The closer the auction is to you, the less time you will likely wait to get the equipment installed.
3) If the equipment is a truck or titled piece, and coming from a private individual or company, get the front and back of the title before negotiating the price. If the seller isn’t willing to provide the title, they will be difficult to work with and likely won’t be motivated to make a sale.
4) Used, non-titled equipment from private sellers requires lien searches. Liens are the legal rights of a creditor over another’s property. If you plan on buying that property, you must conduct a lien search to ensure that the asset you are buying doesn’t stay under the previous creditor. You don’t want the IRS or a bank to repossess your equipment if the liens weren’t properly released. (ACG takes this step for all our clients and works out the details with the seller to protect our clients.)
If you are looking to take advantage of the current market and purchase equipment on sale, but don’t have the cash on hand to do so, consider financing. The cash inflow from the needed equipment will outweigh the cash outflow of a monthly payment, which will increase overall cash flow and help your business greatly. American Capital Group can get you approved same day, and discusses your individual business’s needs so that payments are in line with your company’s financial goals.
