Best Practices in Remarketing Off-Road Equipment
Remarketing can yield major resale dollars for “yellow metal” and other off-road equipment. Five fleet experts weigh in on some of the best ways to maximize resale value for off-road equipment.
June 2011, Government Fleet - Feature
Appealing photos and accurate video of a new Holland 555 backhoe helped the Town of Jonesborough, Tenn., see major remarketing success.
AT A GLANCE
Several fleet experts offer pointers to maximizing the resale value of off-road equipment, including:
- Setting a well-planned replacement schedule.
- Researching and comparing values online and locally before selling.
- Spending a few hours making the equipment presentable.
- Taking advantage of online auctions and utilizing photos and video.
- Considering the buyer standpoint when describing the condition of the asset.
When fleets remarket vehicles, they earn precious dollars that can help offset the cost of purchasing new units. The same is true for off-road equipment. By opting to remarket used "yellow metal" over disposal, fleet managers can see higher resale value than they might expect. Remarketing off-road equipment relies on tried-and-true remarketing techniques, but also calls for a few of its own best practices.
Five fleet managers for city, county, and state fleets shared their own practices and offered advice for maximizing resale value.
Choose the Right Time to Remarket
First things first: Finding the right time to part with off-road equipment is an important part of launching the remarketing process. Gary Lykins, fleet manager for the Town of Jonesborough, Tenn., explained that the urge to keep a depreciated unit around for parts can be tempting - and pressure to keep it around for a spare can be overwhelming. However, Lykins said a well-planned replacement schedule is a fleet manager's best bet.
"Remarketing keeps the river of yellow metal flowing through the economy," Lykins said. "When an organization purchases a piece of equipment, the clock is running; rather, many clocks are running. The asset is depreciating, the technology is getting better on the newer models, and the productivity 'up-time' is declining on the asset you own. The accepted optimum replacement schedule is at the mark when depreciation and repair costs intersect."
Lykins suggested fleet managers set a replacement schedule, then stick to their guns. Finding the right time to remarket can make the best use of equipment - and the public's dollars.
Determine the Right Price
Once you've made the decision to remarket off-road equipment, it's a good idea to estimate the value you'd like to get out of it. This will help determine the appropriate avenue for remarketing the unit, as well as set expectations for the value you'll get.
Allen Mitchell, CPFP, fleet manager for Snohomish County, Wash., researches equipment values online and locally before attempting to remarket his equipment. "We determine values through online resources and monitor bidding online to ensure we are getting the values we think are appropriate. If we aren't able to obtain a current value, we'll call some local dealers or our auction vendors for an estimate," he said.
Delaware DOT provides prospective buyers access to equipment maintenance records.
Invest a Little, But Not Too Much
Part of what makes an asset attractive for sale is presentation, which relies on the work put into making the piece presentable before it goes up for sale.
In preparing equipment for resale, Lykins suggested putting in a little effort beforehand - but not so much that you reduce the overall value of the sale.
"Don't go overboard," he said. "The reason you are getting rid of the asset is because the cost of keeping it up has outweighed the benefit of having it around. Chances are, you have spent way too much on the asset already. Just simply budget a couple hours of shop time to fix some of the little things and give it a good cleaning."