Sometimes, buying used is the best choice. It’s priced less than new, expanding your options without expanding your budget. But, don’t just purchase any old used machine. Make sure you get exactly what you want: low hours, great condition and the right configuration. Also, it always helps to buy from a reputable source.
So, what are a few benefits to buying used?
Buying new equipment is an investment that can have a significant impact on your company’s cash flow. However, you can purchase quality used equipment and at a much lower cost. It’s possible to save thousands.
The prospect of buying something new is satisfying, but you don’t need to sacrifice quality simply because the machinery has been previously owned. If the equipment has been taken care of, you can still get several years of reliable service from it. Always ask for the machine’s service and maintenance history.
Also, buying used equipment means paying less in sales taxes because of the lower initial purchase price. You could decide to spend your savings on attachments, maintenance costs for your existing fleet or maybe even toward the cost of buying a second piece of equipment. We won’t tell you how to spend your savings.
When a new construction machine leaves the dealers lot and hits your yard, depreciation kicks in. In the first 12 months after you take it, you can expect double digit depreciation. It does slow down afterwards, but by choosing to buy a used piece of equipment, you miss that early fast depreciation.
“Take care of things, and they will take care of you.” As long as the used equipment is properly maintained, it will hold its value. Make a point of keeping detailed service records. Not only will you need to track any expenses incurred in keeping the equipment serviced for income tax purposes, but this information will be very important when the time comes that you want to sell the equipment later on. Prospective buyers will be very interested to find out when the machinery was serviced and what was done. The more details you can provide, the more likely you will be to find a buyer quickly and get an offer close to, or at, your asking price.
Lower Cost of Ownership
Since used equipment holds its value pretty good after the first 12 months, you can sell it and recoup a very good percentage of what you paid for it. In the meantime, you can deduct expenses such as amortization, interest on financing costs, maintenance, insurance, etc. on your income tax return starting in the year you purchased the equipment.
You also will benefit from lower insurance costs, providing your insurance company bases their premiums on the replacement value and not the cash value. Choosing replacement value means you will be entitled to compensation for the value of a similar year and model of the type of equipment, should something happen.
Check out our Used Equipment Listing Here.