1. Focus on the features
Begin by knowing exactly what features you are looking for. Used industrial machinery can be available in a wide variety of options. You will find the regular “plain vanilla” options as well as thousands with different combinations. You may find a perfectly priced option, but if it doesn’t have the features you need for your operations, it will end up being a waste of cash.
For example, row crop growers in the Midwest will employ John Deere tractors for handling a wide range of tasks. The modern tractor has come a long way and is available with Air Conditioning, hydraulic remotes and mechanical front-wheel drives. But some of these tractors are manufactured with the short axle which will not allow the use of a dual-wheel system. A dual-wheel system is pretty much a standard requirement for tractors on Midwestern farms. Therefore, it is essential that these details are fully examined before purchases are made.
2. Specs are King
But don’t say “no” to special features too quickly, even if you don’t really need them. If you find a machine that does include a popular feature that is not immediately important to you and your operations, it may benefit you to pay a little extra. The main reason is if you are considering resale in a few years. A popular feature may boost resale value. Some of the popular features to keep an eye out for include onboard electronics, MFWD, premium cabs, remote hydraulics and additional tire options.
3. Know what similar assets are selling for
Always begin your search from an enlightened perspective. For example, if you have researched the market values for the items you will be buying for several months, you will have a better idea of what fair asking prices look like. Tractorhouse.com and Fastline.com are two places to begin your search for fair prices. Look at the asking price and the prices you have seen similar items sell at auctions. Compare these prices and factor in the differences to see what was paid for each item.
4. Research competitive brands
Don’t develop strong emotional attachments to a single brand. There are many brands and you will find that a comparable option may be good enough to serve your purpose. Keeping your options as open as possible is a good way to save hundreds and even thousands of dollars. Also, consider the level of use you will get from your machine and if any user support is available from the dealer. If your machine will only be used a couple hours each month, then you may save cash from choosing a different brand.
5. Assess condition
The condition of the equipment is another very important factor in assessing the value of your purchase. Tractors in good conditions will be connected to higher price tags. Tractors from the Midwest have a reputation of being so clean and well-maintained they have created the term “Midwest clean”. This is due to their low use and above-average care. On the other hand, the same tractor from Florida or the Mississippi delta will be used for many hours, be faded from being parked in the sun and be driven by 10 to 20 different people as opposed to just one.
If the equipment you purchase comes with on board electronics, check that nothing has gone obsolete. Never pay extra cash for features that are not upgradeable or are no longer needed.
You can check for internal problems with a proper inspection. IronPlanet is one of the few auction houses that will allow these detailed inspections and guarantees for the products they sell. Oil samples are also very important to identifying issues in the engine or transmission.
7. Assess the dealer landscape
Get a good idea of what type of support you can expect from the dealers in your area. This detail can change much about the entire experience. If you don’t have a dealer close by, you may have to travel extensively to find the parts you need. This is also something that can change abruptly if a dealer’s branches close or move. Stay connected with the providers and services in your area.