- March 26, 2019
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How Your Competitor’s Used Machinery Can Make You Money
Here at Machines4U, we want nothing more than to help you sell your machinery at the best price. But all too often we see businesses across Australia struggle to get customers through their door. And it’s often for a simple reason: machinery buyers start off looking for second-hand products—meaning if you aren’t advertising used machinery on Machines4U or your own platform, then you’re missing out on a huge chunk of potential customers straight away.
Imagine this: You’re a business owner looking for an excavator for a new project. Odds are, you already have a preferred brand—Caterpillar, Hyundai, Hitachi, Komatsu, Kubota, etc. How would you go about looking for the machine? Across Australia, between 1,000 and 10,000 people search “mini excavator for sale”, “kubota excavator” and “excavator for sale” every month.
And the top results for these searches? Used machinery sales. This holds true for many industries; buyers are looking for used machines because they’re often just as good as the newer models, and at a fraction of the price.
How Selling Other Brands Can Get You More Customers
“So what?”, you say, “I need to sell new machines—how does this help me?” Simple. If you’re trying to sell a new laser cutter or engraver, let’s say it’s an unknown brand from China, just as good as Trumpf, Bodor or Mitsubishi, and two-thirds of the price, odds are you’ll find it is a struggle to get customers in the door. That’s because people are searching for the big names they know and trust. What you need to do is to make use of those well-established and trusted brands to sell YOUR machine.
If someone is looking to buy a used laser cutter or engraver and comes into your store, you’re already halfway there! Ideally, this potential buyer will walk into your showroom to see a selection of used laser cutters surrounding your own new, lesser-known machine.
Now, the one thing you absolutely must avoid is the hard sell. Customers, especially machinery buyers, are experienced and know what they are talking about. They can see the hard sell a mile away. Show them the Mitsubishi, sell them on the benefits, all the features and the brand, then show them yours.
Point out where it’s superior, maybe it uses less power but provides the same performance. Maybe it can cut through thicker metal than the Mitsubishi. This part is on you and your sales team. You want to showcase your product with the other big names, because it will subliminally make the customer start to consider your brand at the same level as the top brands.
The final part to this is the price. As with most businesses, ROI is the end-game. What does it matter if you get a great machine if it costs more than it will make them? This is why used machines are so popular, a 2014 excavator is likely to do the job just as well as the 2019 model, so why pay the premium? Of course, the finance companies don’t always agree.
Use Finance Companies To Help You Sell
New machinery is expensive, often starting in the thousands, good machinery can range from $5,000 up to over a million dollars. This puts buying new or used machinery outright out of reach for most businesses. Of course, this is beneficial in your journey to sell quality new products.
Because businesses can get a tax write-off for interest, you can generally bet that your customers will be using finance to buy any of your machinery that’s worth more than about $5,000. And for general machinery, finance works much the same as car finance, the companies will assess the risk and say yes or no. But sometimes that no will actually be a “yes, but over a shorter period”. This is where your sales team comes back in.
If your buyer came in for a used John Deere tractor, let’s say the price is $888 a week over 3 years as it is a fairly old model. And let’s say your lesser-known tractor is $780 a week over 5 years, but is brand-new, comes with a guarantee and can do the job just as well. What would you choose? A used machine from the big brand at a higher price? Or the cheaper-per-payment tractor that does the job and comes with a warranty? It’s hardly a difficult choice.
By now, your salesperson has built a rapport with the customer, the buyer trusts your business because you’ve proven you know what you’re talking about. Not only that, you can save them time, money and effort with a superior deal right then and there.
Make Your Machinery Stand Out
Trying to take on those big name brands without a matching reputation is never going to work. Brands like Caterpillar and John Deere have been around since the 1800s. No amount of advertising can catch up with that kind of momentum. So take advantage of their reputation. Showcase your product next to theirs and give your customers a choice. With lower payments, included warranty and equal or superior performance, you’ll soon find your brand-new machines are attracting more interest thanks to that used branded machinery you got for a bargain at auction.
There are exceptions to this of course. Some machines, like CNC plasma cutters or lathes, simply don’t have a viable second-hand market and used products have little-to-no resale value at all. Always do your research beforehand to see what the market is like for your particular product, especially if you’re planning on buying at auction.
Want to know more about how to improve your machinery sales? Find out how quality photos can help you sell machinery here.
*Prices in this article are generalisations only. Prices may vary and should be verified with individual sellers or dealers.