Since many pieces of off-road equipment are painted manufacturer Caterpillar's signature yellow hue, this class of equipment is sometimes called "yellow metal" or "yellow iron," irrespective of the manufacturer. There comes a time when it's reached the end of its useful life, and you want it off your hands. What are the best ways to dispose of this equipment?
Government fleet managers often choose to trade in older off-road equipment for new. Others have discovered they can move off-road equipment efficiently online and sometimes realize a meaningful return on it, too.
Turning to YouTube to ReSell Equipment
J.D. Schulte, fleet manager for the City of Moline, Ill., has jumped into the cyber world with both feet. He posts videos on YouTube to allow remote buyers to see and hear equipment in operation.
"It works well," Schulte said. He started posting the videos more than two years ago, he said, "because we were selling items on eBay, and we just thought if people were going to buy something like this, they would probably be a lot less apprehensive if they could hear the engine run and see all the attachments run. That's what led us to doing this."
The City fleet also sells and posts videos on the Web site www.publicsurplus.com and has worked with US Auctioneers.
When considering purchasing equipment, Schulte said, "I'm a lot more comfortable when I can see it and hear it and get to walk around it."
The videos serve that purpose for remote buyers, Schulte said, whether they are buying for themselves or are engaged in proxy bidding. "They'll be a little more comfortable bidding on some of our equipment if they're not going to be in town for the auction," he noted.
Schulte prefers the online venue compared to conventional auctions. In fact, he said, he no longer bothers with traditional auctions.
"We used to do a once-a-year live auction," he said. This approach had a number of disadvantages, including having to store vehicles and equipment until the time came for the auction.
"We'd have vehicles that sat sometimes eight, nine, 10 months," Schulte explained.
"Now as soon as we take something out of service, it's out of here," Schulte said. "And we don't have dead batteries, flat tires, all the other issues that come along with trying to store vehicles and get them ready for an auction."
Conventional auctions also tended to draw a smaller crowd compared to online sessions, "and when you limit yourself to such a small audience, you just don't get the most proceeds," Schulte said.
The first full year the City of Moline fleet engaged in online auctions, it saw a 63-percent jump in dollars generated, compared to sales figures by conventional auctions the previous year, Schulte said. Once he started augmenting the online effort with video, proceeds increased further, Schulte reported.
Trading In Reduces Expense, Freeing-Up Funds
Alan Brown, fleet manager for the City of Littleton, Colo., said he typically trades in his off-road equipment. "That works out because it reduces my expense line," freeing funds for other things, Brown said.
Auctioning, or per the City charter, seeking bids on equipment, presents potential drawbacks, Brown said. For one, the return is uncertain, he said, and the monies go to the revenue side. "It doesn't impact my expense side the way a trade-in does."
A trade-in reduces the outlay for a new piece of off-road equipment, Brown said, adding he believed he could also get something close to its actual worth.
"When it comes to automotive, I have a totally different opinion," he noted. "I don't think I get my money's worth on trade-ins on automotives."
The Littleton fleet operates only about a half-dozen pieces of off-road equipment, Brown said, but in a past job, as equipment maintenance supervisor for Larimer County, Colo., Brown saw much more heavy iron that had to be disposed of annually. The approach then was geared to remarketing the equipment, Brown recalled.
"Sometimes we did trade-ins, but more often than not, we would either send the stuff to auction or put it out for a special bid if we felt it was something that had significant value that wasn't likely to be realized at auction," Brown said.
Usually the off-road pieces were used until they were on their last legs, and then they were dragged to auction, Brown said. Even in such much-used condition, he said, "That stuff goes."
He recalled an old John Deere grader the County took to auction. "It had a blown engine and a bad transmission, and we had robbed parts off of it," Brown said. "The engine was just sitting in the engine compartment. It wasn't actually connected. That thing went for $17,000 or $18,000."
A representative of the buyer, a local excavation company, tried to hire Brown to restore the grader to working order, Brown remembered.
"I told him if I were about to put that thing back together, I would have done it while it was still in my possession," he said.
Brown said in his current position in Littleton, he has auctioned some equipment, either in conventional live auctions or online.
"The last couple of years, I've been splitting my auction time between a local auction house that I've been aligned with for many years and an online outfit called publicsurplus.com," he said. "At first, I didn't like the online [process] because it turned me into the auctioneer, and I had to respond to all these people with their questions."
However, he observed, "it looks like the money is equivalent if not better."
Brown is growing increasingly comfortable with online auctioning. "What I like about it is I can pick my own time frame," he said. "I don't like my junk laying around here waiting for an auction. If I'm ready to get rid of it, I can just slap it up there and be done with it, as opposed to waiting" until the time of the next live auction.
In Larimer County, he recalled, agencies would combine all their surplus vehicles and equipment and hold an auction once a year. "It was a major ordeal. We'd stack the stuff up on a back lot for a year, and then we'd spend two weeks every fall doing nothing but getting this stuff to auction."
Online Remarketing Doubles Revenue from Auction Sales
Gregory Speas, fleet service director for the City of Hot Springs, Ark., reported success unloading equipment online — and a preference for the venue.
In the past, the City brought in an auctioneer to sell all surplus equipment, Speas recalled, and the events "might draw 150 to 200 people."
He said, "We did sell a bulldozer one time that brought $12,000 or $15,000, but it was very rare if we got any money out of old equipment."
About five years ago, Speas said, the City of Hot Springs started using the Internet to re-sell equipment. While a number of Web sites are available for the purpose, Speas said, "It's hard to beat eBay."
In the five years since the City began re-marketing equipment and vehicles online, "We've basically doubled the revenue that we make off surplus equipment," Speas said.
"We have people buying up our cars and trucks and equipment - everything that we sell - from all over the country," Speas said. "We just sold a roller — and it was an old one — to a guy from Canada." The buyer, a contractor, paid almost $2,500 for the 1986 roller.
The City of Hot Springs fleet numbers some 700 pieces; about 200 are heavy equipment. Revenue from the online sale of each piece of equipment is returned to the city department that used that piece, Speas said.
The result is savings for the City, plus a benefit Brown of Littleton cited — avoiding the labor and time involved in preparing for a conventional auction.
"You have to wait till you build up a bunch of equipment, and then you have to do quite a bit of work to get an auction together," including moving the equipment and advertising the event, Speas said.
"Now we just take a picture of it, wherever it's sitting, and we sell it online, and we don't have to touch it," he explained.
Trade-Ins & Auctions Work Best for Needham
The Town of Needham, Mass., has yet to try the online option. "Right now, I don't know enough about how well it works or what we have to do to set it up," Steven Hawes, garage and equipment supervisor for the town, said.
The town legally disposes of equipment in three ways, Hawes said, including trade-in or auction, or notifying other Needham town departments the equipment is available as surplus.
"If none of those pans out, we can cut it up and dispose of it as scrap steel," Hawes said.
The Town usually disposes of off-road equipment through trade-ins or through auctions handled by an auction house that operates a branch in a nearby town, Hawes said.
Trade-ins are Needham's usual method of moving off-road iron, and as a second choice, the arrangement with the auction house has worked well for the town, said Hawes. "I can auction one piece at a time if that's all I have," he noted.
Sometimes, an auction brings in just enough money to cover the auction costs, Hawes said, "Other times it's brought in substantially more than I thought it would have on a trade."
The Town's fleet includes a dozen to 15 heavy pieces of equipment, including loaders, backhoes, and excavators.
Front-end loaders have not been auctioned. "They have all gone as trade-ins," Hawes said. "There's a much higher value there."