32
INDUSTRY FOCUS
USEDCRANEMARKET
ACT
OCTOBER2014
Gardner Dudley
reports
on how tomaximize
recovery of used and
surplus crane assets.
opportunity.More companies are looking
at investment recovery as a vital part of
their business practices, and there’s a
clear reasonwhy. Investing in abest-in-
class asset-management process to sell
surplus cranes andother equipment in a
more strategicwaywill yield results. This
investment includes:
■
Keeping statements of origin and
comprehensive records of the crane
throughout its lifecycle.
■
Investing in a customizedmaintenance
plan for allmachines. This canbe
performed in-houseor through a trusted
provider.
■
Timelydispositionof the crane to
increase its value.Once the cranehas
been slated as surplus the remarketing
process shouldbegin to ensure the
greatestmaximumvalueon its sale.
Companieswith a reputationof selling
well-maintained anddocumented cranes
will generatehigher prices on their
machines over comparable cranes sold
on themarket. Keep inmind, cranes
canhold their value through several
service lives provided that they arewell
maintained.Maintenanceplans alone can
make thedifferencebetween a recovery
of 55percent of acquisitionvalue, versus
75percent or better onwell-documented
cranes.
Reverse supply chain
When an asset is slated tohit theused
or secondarymarket, remarketing to the
appropriate buyer base is crucial as crane
type oftendictates thepotential target
audience. For example, a 20-year-old
conventional crawler and a five-year-
D
emand for used cranes/
surplus crane assetswill
always exist given the
amount of onshore andoffshoreoil
andgas production, rising energy
needs and the continuous buildingof
infrastructure all over theworld. If
approachedproperly andproactively,
smarter asset-management planningwill
allow companies to effectively leverage
secondarymarket demand to createnew
revenue streams andmaximize recovery
for their surplus cranes. By investing
in recovery (includingmaintenance),
implementing reverse supply chainbest
practices (establishing lifecycle and
remarketingplans), andworkingwith a
trustedpartner tomanage all aspects of
disposition, crane-owning companies can
reach the right buyer base andgenerate
maximumprices for theirmachines.
Over the last decade,many companies
have shifted their approach regarding
how theydealwith the total lifecycleof
their cranes.Whether through increasing
regulations, corporate responsibility
initiatives, brandprotection concerns or
demand for real-timeperformancedata,
a common trend is the increaseddesire
to approach surplusmanagement as an
old all-terrain are both viable for resale
to endusers, butwill attract different
buyers.
Crane conditionwill also impact the
buyer type. A crane in good condition
canmove straight to an end-user or
smaller,mid-sized company, while a
crane that has not beenwell-maintained
might be better suited for an exporter
thatwill repair it first, and then resell it
overseas. If the crane is salvage quality,
there are typically international buyers
interested inpurchasing it for parts.
When remarketing todifferent global
regions, companies should factor in
logistics expenses, including transport
and export fees. SouthAmerica is an
attractivemarket to theUnited States
due to its proximity, whileEuropean
companieswould exportmoreheavily to
Africa.
Additionally, compliancemeasures,
including screening for restrictedparties,
are important to adhere to as are relevant
legal requirements.
If a companydecides to sell its surplus
cranes itself, it’s important to implement
best practices to achievemaximum
recovery. These include:
■
Take complete inventoryon all assets
anddetermine estimatedvalues for
each. Focus on selling thehigh-value,
late-model equipment first togenerate
more return. Keep inmind that a trusted
valuationproviderwill have greater
knowledge about themarket to assess the
crane’s value, improving results.
■
Determine the appropriate sales
channel (ormulti-channel solution) for
the equipment, such as anonline auction,
THEAUTHOR
GARDNERDUDLEY
is vice
president, Capital Assets
Group, Liquidity Services,
an asset recovery and
valuation company. Please
visit
formore
information.
Getting top
dollar
A 20-year-old
conventional crawler
and a five-year-old
hydraulic all-terrain
crawler are both viable
for re-sale to end
users, but will attract
different buyers.
