Let’s start with the challenges of buying any asset for business purposes. First, you need to identify the business requirements, then research the options and get buy-in from any stakeholders in the business. That’s all before you negotiate price, delivery and maintenance.
This can be a time-consuming exercise, depending on the complexity of the purchase. Now, compare that to the immediate opportunity to acquire an item at auction (at a fraction of new cost) where you have the ability to determine the price you'll pay.
Let’s explore the benefits of buying at auction in more detail.
Speed
Certain smaller tooling and related facility and plant assets are readily available from Original Equipment Manufacturers (OEMS), but as you move to process machinery and production assets the lead time to acquire those assets new is significant.
You might work through a specification for your new production line with various suppliers, dovetailing their recommendations for each asset in the line and finalizing a plan over several weeks. Then the equipment needs to be manufactured, delivered, installed and tested. Depending on your process you could be looking at weeks, or months or in some cases over a year before you’re in production.
Compare that with assets in an auction – often available as a complete production line – which can be purchased, match-marked, dismantled, shipped, reinstalled and running in a matter of weeks.
The additional revenue achieved by being in production faster can have a significant impact on your bottom-line. The ability to acquire ready to use assets today or tomorrow at auction is a huge benefit to buying at auction.
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Investment
When comparing new with used, the price difference can be considerable. Then add to that, the opportunity to find a bargain in an auction setting and the savings could really add up.
You have to consider the additional engineering costs involved with dismantling and shipping but even so, there is an opportunity to significantly lower your overall investment.
A balanced view
When considering buying at auction you must look at all aspects. There are some clear price and time savings, but you also have to consider the drawbacks. There’s no warranty with assets purchased at auction, do you have engineers you can call on to inspect assets for you? There’s also convenience – new equipment can be made to order, whereas used equipment is always subject to availability.
Who’s bidding at auction?
Auction bidding audience run the gamut from individuals, to small businesses and to large multi-national corporations. Each bidders has their own unique interest, budget and need, and every auction is different. For more information read our blog - Buy in Auction Setting.
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