When to Replace or Repair Construction Equipment

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When to Replace or Repair Construction Equipment

• Companies that rely on heavy equipment for their
  work have to do a delicate balancing act when it
  comes to selling or storing their equipment. You
  dont want to wait too long and lose out on
  cashing in the value of your heavy equipment. On
  the other hand, if you sell too early, you lose
  out on getting the most from your equipment
  investment.
• There can be a number of reasons why a company is
  considering replacing some of its equipment,
  such as
• It has become more costly to repair than finance
  a new piece of equipment.
• When a piece of construction equipment has more
  downtime than the company can afford.
• The company no longer needs that particular piece
  of equipment.
• A newer model with more features and specs is
  available.
• A lot goes into considering when to repair and
  when to replace your equipment. A replacement
  implies more investment or money from your
  pocket, but the possible return on that
  investment can make it a good move. In the same
  way, repairing your equipment keeps it running
  longer and can retain the value for when you
  decide to sell.
• Here are some things you should consider when
  deciding whether to repair or replace your
  construction equipment.

Business Address 65 Shuter Street, Unit 114,
Toronto, Ontario, M5B 1B2 Phone No.
888-471-5066 Site - https//www.michaelsglobaltrad
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• Is the equipment still under warranty?
• If repairs are still covered or even partially
  covered, it will likely cost less to fix it
  instead of repacing your construction equipment.
  Most warranties cover the machinery for up to a
  year. Failing to take advantage of the warranty
  is essentially tossing some of your equipments
  value out the window. Its not something you want
  to take for granted.
• Keep it in mind when you buy a new piece of
  equipment and be sure to get as much protection
  in a warranty as possible. You may need to shop
  around and find a supplier who offers you a
  solid warranty on your equipment.
• If the equipment is no longer covered by
  warranty, it does not mean you should immediately
  sell it and replace it. Instead, use the 50/50
  rule. With the 50/50 rule, you should continue to
  fix the equipment until the cost of repairs is
  half the cost of replacing it. The idea driving
  this calculation is that the repair costs will
  increase as the machine wears out. Once it starts
  wearing down and needing repair more often, the
  equipment becomes a liability. It loses its
  value, and you should replace it as soon as
  possible.
• Consider your companys priorities
• Some organizations have policies around equipment
  repair and replacement that you can use to guide
  your decision. However, if your company does not
  have such guidelines, its probably best to
  decide what saves the most money right now
  without putting safety or security at risk. When
  it comes to large construction equipment, its
  often more economical to repair it than it is to
  sell and replace it. These pieces of equipment
  can cost a lot, and your company will want to
  get the most out of its investment.
• Calculate the financials
• Another factor in the decision to repair or
  replace your construction equipment is the
  financials or the full cost of repair or
  replacement. Work out how much the machine is
  depreciating and what taxes or other financial
  implications there are to keeping it. Remember
  that older machines depreciate slower than new
  ones. Here are some questions to ask as you look
  at the cost of repair and replacement
• Are you still paying for the equipment, or has it
  been paid off?
• How much tax will you pay on a new unit?
• What are the estimated maintenance and service
  costs of a replacement?

Business Address 65 Shuter Street, Unit 114,
Toronto, Ontario, M5B 1B2 Phone No.
888-471-5066 Site - https//www.michaelsglobaltrad
ing.com/ Email ID sales_at_michaelsglobaltrading.co
m
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Most organizations prefer to repair construction
equipment until these costs exceed the
price youd pay for a new piece of machinery. 4.
Life cycle cost analysis A life cycle cost
analysis is usually done on each piece of
construction equipment an organization owns.
This report is very detailed and offers a
comprehensive view of each specific piece of
equipment. It is used to forecast and analyze the
best course of action, whether to repair or
replace. It can be a time-consuming process, but
when complete, you can be confident you are
making the right decision for your
organization. While there are different methods
to approach the life cycle cost analysis, the
process will examine expenses involved with
ownership of the equipment and with the operation
of the equipment. The outcome may look at
different scenarios so you can compare the cost
of each. Ultimately, when deciding whether to
repair or replace your construction equipment,
youll need to consider the pros and cons of
each situation. There is no one-size-fits-all
answer to whether you should repair or replace
your equipment. It will need to be decided on a
case- by-case basis. Gathering as much
information as you can about the equipment and
how much it costs your business and comparing it
with how much revenue it is bringing in for your
company is the most fundamental way to determine
when its the right time to repair or
replace. If youre ready to sell your
construction equipment, contact Michaels Global
Trading. Our team has experience working with
other construction companies to liquidate their
equipment. With our services, youll be able to
focus on what is most important and leave the
selling or downsizing to us. For more
information about our liquidation services, or to
sell your equipment at our liquidation warehouse
in Toronto, call Michaels Global Trading at
1-888-902-7531 or contact us here. Original
Source https//www.michaelsglobaltrading.com/when
-to-replace-or-repair- construction-equipment/
Business Address 65 Shuter Street, Unit 114,
Toronto, Ontario, M5B 1B2 Phone No.
888-471-5066 Site - https//www.michaelsglobaltrad
ing.com/ Email ID sales_at_michaelsglobaltrading.co
m