Savings and Startups: Pointers for Purchasing Pre-Owned Equipment and Supplies
When a business needs new equipment or is just getting started, the budget is usually pretty tight. Here’s how to get your hands on pre-owned equipment so you have enough money for other essentials, like marketing and sales materials.
Why refurbs are just as good as new, in most cases, and where to get them
Refurbished products often use the same casing, shell, or other materials that came with the original product. Wear parts are replaced, and the entire unit is resold as new. In some cases, wear parts can be rebuilt and used as though they were new.
For example, Sweepscrub used floor sweepers are often either rebuilt or contain refurbished parts. It may not look exactly new, but it will almost always function that way. And, because the high cost of original manufacturing is already paid for, these units will sell for much less than when they were brand new.
How to get a warranty on pre-owned
Believe it or not, many used products come with warranty options. Product suppliers know that businesses are wary of buying into a pre-owned product that might not function as well as it needs to.
“Used” can sometimes become associated with “low quality.” This is especially true when the product in question has a reputation for being used and abused in a trade. For example, many cleaning machines and products related to janitorial services get beat up pretty badly during their service life.
When belts and clutches or motors burn out, the machine is “dead” and thought to be useless. This is where a refurbisher can make a lot of money. By replacing the motor, or whatever else is broken or damaged, the unit can be reborn. It’s true that the original case, and much of the original product remains. And, it’s also true that cosmetic damages are often irreparable. But, resellers focus more on the efficacy of the product – “can it do the job?’
As long as it can, then this becomes a strong selling point. And, since the refurbisher has essentially rebuilt the essential components of the product, it can offer an extended used warranty on the new or rebuilt parts.
Some stuff is better used
Sometimes, used is better than new. In the restaurant business, used cookware is sometimes seen as a liability. But, some pieces of cookery actually get better with age, like Woks, and cast-iron pots and pans. Even when stoves, and other similar appliances, are older and broken down, all it takes is the replacement of one or two key components to get it working again.
This one should be obvious, but it’s easy to forget just how much money you can save by buying a pre-owned unit over a new one. Depending on what you’re buying, the savings could be over 50 percent.
And, those savings can go toward other things like marketing or sales materials. You could also use the money as a cash reserve for lean times, to pay employees during slow months or quarters, and to build out your enterprise when the time is right.
Get better rates
When you lease older or pre-owned products or machines, your business will often be able to get better rates and terms. Leasing companies will usually provide the most competitive pricing on used equipment since it has already depreciated.
Getting better support with pre-owned equipment
Getting replacement parts, or another piece of equipment, is often easier when it’s pre-owned to begin with. This is especially true when you’ve leased the equipment. When it breaks, or it doesn’t work anymore. It’s usually up to you to fix it if you’ve purchased it outright. But, if you lease, you simply call up the leasing company and have them fix it for you. In many cases, you can just trade it in for a new piece of equipment.
The leasing company will send you a replacement, take away the old piece of equipment to fix it, and then lease it out to someone else.
When it comes time to upgrade, it’ll be easier because you’ve saved yourself a lot of money by not buying new. Again, this works out well (much better, in fact), when you’ve leased the equipment as opposed to buying it outright.
You can stay up to date with the technology and not worry about having to research the latest offerings every year. This is a major reason why businesses lease equipment – for the cashflow benefits. If a company can make more from sales than what the total cost of the lease amounts to, then leasing becomes a winning proposition every time, even when finance or leasing charges are factored in.
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