Buying or Selling New or Used Construction Equipment? Some What to Understand About Fleet Mix

The construction industry has had a slight hit on the glory years of the casing bubble, but these companies feeling the downturn may also be exactly the same companies that built infrastructure during the last 200 years. They’ll prevail over any short-term drop in overall construction request; having said that there is always attention that may be given toward the profits on return that your construction possessions bring to bear. In this specific case we are discussing construction equipment and tools.
My background is in the rental marketplace, for the reason that industry we were return on investment orientated by understanding each possessions contribution to the bottom line by having a real-time understanding as time passes utilization and dollar utilization. After starting my own construction business in the past, it became obvious that although I did not have the same measurement tools available with possessed construction equipment, the focus on return from equipment investment still needed to be there. Construction companies are in different levels of understanding the return on invested fleet dollars. I have seen large construction companies that not track costs per equipment piece. I’ve seen small companies do an exceptionally good job of understanding how their assets are working for them. Nowadays all companies should operate toward a tightening of the belt by comprehending how to get yourself a better return on equipment expenditure. First of all, construction companies need the capability to create a real measurement of outflow of expense with regards to their construction equipment. Fleet managers, operations managers and accountants need to have a form of tracking that contributes specific cost to individual equipment items. Amount a way to collect, store and utilize the data that tells you exactly what is taking place together with your construction fleet. It is important that you realize asset utilization and return on investment by analyzing both your utilization and ROI quantities, it is possible to identify key areas within your operation that need improvement, and take the correct steps to adjust just how that business is conducted.
Once you start tracking and measuring you will begin to develop the needed data to make informed decision on your own construction fleet mix. In terms of decision making it is all driven by chance cost which is the expense of any activity measured in terms of the best alternative forgone. It is the sacrifice related to the next best choice available to someone who has picked among several mutually special choices. Whenever we analyze opportunity cost being an operations manager we must understand about other opportunities available. As market segments change so do opportunities. Regarding construction equipment you must understand current market value of the equipment and measure that against different available fleet options.
After careful analysis you might find that your equipment is not providing the needed return where the value of the machine could possibly be put into higher return areas for the company. If this is the case you should look at your true expense of keeping the machine by a careful analysis of other industry opportunities. In lots of of the markets equipment local rental rates have fallen to a level that does not warrant for contractors to own a good amount of certain equipment types.
If you find that you should change fleet mix or raise the return generated on a particular piece of equipment there are numerous marketing opportunities out there.
1) Fleet share – Look for a location that contractors can list devices for sale and also let other construction professionals know that they would be willing to lease or rent that during the interim. This will allow contractors to create additional local revenue while they market the equipment for sale.
Power Tools and Construction Equipment
2) No cost to Market venues – Find an attractive venue that allows one to list your fleet with little or no listing cost, no settlement fees. Generate interest on the equipment over time and don’t be subject to inflated expenses to take the piece to market.
3) Search for industry deals on New Tools from the Manufactures. Many manufactures are providing deferments in cash outflow for those with qualifying credit.
4) Do not choose new or used equipment order until you have really looked at the offering of the entire market. Make sure that you are informed on the overall opportunity available. This occurs in both employed and new equipment markets and can be remedied by spending enough time to not only understand what the machines offer but understand all of the pricing opportunities for the equipment type you are looking to obtain. Bottom line is certainly informing yourself on the leads of the market.