Outdated Equipment: What Should You Do?
Do you have old or unused equipment collecting dust at your business? In fact, with technology on the rise, industry averages suggest that digital and networking equipment can become obsolete after just three years.
Unless you have unlimited storage space, it can be difficult to house all of your unused machinery. This is why countless manufacturing business owners have begun to sell their used equipment.
Not only can you enjoy a little extra cash flow, but you can also free up some much-needed space in your warehouse. Let’s go over the average lifetimes of equipment and how you can begin selling your old machinery.
What are the Average Equipment Lifetimes?
The average lifetime for your equipment can vary based on the machinery type and usage. Looking at depreciable lives according to the IRS can give you a general picture of when you can expect to turn over equipment:
- Software – 3 Years
- Vehicles, Machinery, Equipment – 5 Years
- Furniture and Fixtures – 7 Years
- Water Transportation Equipment, Electric Grid Systems – 10 Years
These are the common asset classes that you will encounter in your business. Keep in mind that the expected lifetime of your equipment can be shorter due to technological innovations. For example, if a new robot can increase the efficiency of your operations by 10%, odds are you are going to invest in that piece of equipment even if your existing robot is only two years old.
Recent studies suggest that nearly 60% of all companies now utilize some form of integrated solutions in their manufacturing process, with another 79% of organizations prioritizing software automation. This means your business can have rapid turnover over the next few years with artificial intelligence, blockchain, and automation at the forefront of disruptive technologies.
Can You Sell Old Equipment?
Simply put, yes. The used construction equipment industry is expected to grow 5.8% over the next five years, giving your business an opportunity to capitalize on unused equipment. Many businesses take a conservative approach to money management during times of economic turbulence. This means that they look for used equipment rather than footing the bill for a new piece of machinery.
This shift in demand places your business in a great position to get rid of obsolete items, from small circuit breakers and bolts to large robotics and servo products. Parting ways with these outdated and unused items gives you extra cash flow to put toward new machinery purchases. A study found that automation can increase your manufacturing production efficiency by 30%. Out with the old and in with the new gives you the opportunity to increase sales, profitability, and growth by 30%.
Summary
What equipment and machinery could you part ways with? Maybe you find an old robot sitting in the corner or a group of valves that you never used. Whatever the case, it’s important that your business uncovers ways to increase cash flow, free up warehouse space, and leverage new manufacturing equipment.
At IMS Supply, we act as your representative when selling old and outdated equipment, pairing your business up with buyers. Our extensive network helps you close deals on machinery and equipment quickly and at favorable prices. Reach out to a team member today to learn how you can get started.
About IMS Supply: IMS Supply is a leading distributor of maintenance, repair and operations (MRO) products and services with facilities in East and West Michigan and Kentucky. Through our MRO Asset Recovery Program we stock hard to find parts and supplies from thousands of different manufacturers at prices up to 70% less than MSRP. Contact us today to find out how we can help your business.
