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Some of you may be apprehensive about buying construction equipment during COVID-19 — and that's understandable. The desire to avoid face-to-face contact, plus varying state travel restrictions, can make it tricky. It's one reason why online purchases, which have been on the rise for years, have boomed in 2020. Pair that with contractors increasingly looking for more affordable options, like you can see the opportunity that's there for online used equipment purchases.
The automobile industry is already seeing an uptick. According to a recent Wall Street Journal article, "used [car] sales actually exceed pre-pandemic levels by approximately 20%" — used machine sales are likely to rise as well.
Even before the current pandemic took hold, more and more contractors were buying used equipment online — and in our fast-paced world, I believe online equipment transactions will increasingly become the norm, with customer preference given to those who provide the most convenient and streamlined process.
In fact, the recent outbreak of COVID-19 has completely changed how we interact with customers. While they used to travel to inspect machines, travel restrictions and health concerns now make this less common. Companies can take advantage of this shift by adapting how they offer their products. At Volvo, we do this with our Certified Used and Inspected Used machines. Both are advertised online with a guaranteed inspection report, eliminating the need for customers to travel onsite to inspect machines.
TIPS TO BUY USED CONSTRUCTION EQUIPMENT ONLINE
To help you feel more confident with inspecting and purchasing used construction equipment online, I've provided some tips to help you properly evaluate used construction equipment when you can't evaluate machines in person — these tips apply no matter where you intend to buy.
- Always know your construction equipment seller. Large dealers and OEMs usually have inventory in different states, so the right machine may not always be close by. When evaluating machines that aren't nearby, know the seller and do business with companies that can knowledgably speak about the machine and its condition, plus provide you any other requested information in a timely manner. My advice is you should restrict your online purchases to sellers that can be verified and who have a solid reputation.
- Start with an inspection report. You should always understand the quality of the machine within your budget. While there are nice, clean, high-hour machines, lower budgets require older machines with more hours, and the likelihood of major component failure and other issues naturally increases. Inspection reports can give you real insight, and whether there are several items on the report or just one, find out why they weren't repaired.
- Ask for a repair quote. There are two reasons a seller hasn't repaired something: 1) either the cost was too expensive or 2) the seller didn't want to invest more into the machine than they had to. Both are understandable, but you have to make sure the price of the machine is consistent with its present condition.
- Request all service records and oil samples. If service records can't be provided by the seller, give the serial number to an OEM dealer and request they give you the records. I've found most OEM dealer service departments are more than willing to assist. Oil samples are critical because they give you the internal vitals of the powertrain.
- Assess the wear components on the machine. Anything that moves has the potential to fail. Major components cost the most to replace or rebuild, but there are times when the smaller repairs can eat up the budget faster. For example, having to replace a seat belt, wiring harness, a set of steps or fenders usually isn't a big issue. However, if all four need to be replaced, you can easily spend close to $10,000.
- Look at the sheet metal, the paint and the undercarriage — and request a video of the machine operating. Look at the age and hours of the machine. Machines that are hammered usually give themselves away through the cosmetics (dents, scrapes, etc.). Pay close attention to the paint as well. It isn't uncommon to see used machines repainted. You just need to know the difference between painting to clean up and painting to hide. There are certain signs of the paint job that can give you clues. If you can't tell the condition of the paint job with the online photos and video, ask the seller to send you close-ups of areas you think look questionable.
- Quality paint jobs meant to clean up a machine give an honest presentation that shows someone took pride in their machine or that they simply wanted to further represent that the machine is in good shape for its age/hours.
Paint jobs with runs, flakes, the wrong color or incorrectly painted items indicate a rush job, the desire to hide something or simply that the owner didn't know what he was doing. Either way, if a bad paint job is detected, proceed with extreme caution.
- Get a guaranteed condition report. If a company doesn't offer a guaranteed condition report, I still recommend traveling onsite and inspecting the machines when possible.
VIRTUAL CONSTRUCTION EQUIPMENT WALKAROUNDS
Virtual walkarounds are becoming more popular — and if done right, can actually provide the visual information you need to make a well-informed decision about a piece of used equipment.
Most virtual machine walkarounds I've seen use recorded video. Many dealers offer this service to customers. The process starts with a specific visual request by the customer. Some use video calling or prerecorded video and physically walk around the machine and address each specific item. For me personally, I use software that allows me to connect a potential buyer with one of our Volvo Certified Used facility techs to conduct the workaround. This process involves me sending a connection link via text to both parties and then I can physically record the walkaround (if requested) while they watch via their cell phones. The software we use is robust, providing several advanced features like two-way screen annotation for real-time collaboration, remote access and control for simpler troubleshooting, and content/media sharing to provide specific information in the form of video, documents, and photos.
HOW ONLINE CONSTRUCTION EQUIPMENT AUCTIONS WORK
Most online auction companies have a searchable catalog of present and future machines to be auctioned. In most instances, you're allowed to go to the sale to inspect the machine, but all bidding is 100% online.
There are two formats: timed and live. Here's how they work:
- Timed auction formats usually start between a few days up to a month before a preset closing time. The bidding increments are usually between $100 and $1,000 per bid, and incrementally increase as bids are placed. Bids are accepted until the preset closing time has lapsed. Timed formats are notorious for weak activity until the last few minutes.
- Live online auctions aren't timed. Lots are sold individually and bidding ends when the auctioneer perceives no more buying activity.
The most common item to be aware of for both timed and live online auctions is the terms. Almost every auction's terms and conditions include the statement "buyer beware" or "sold as is, whereas" with no reserve price. Always understand you're responsible for verifying all information, terms and conditions. Also, pay close attention to buyer fees and transportation costs.
For dealer purchases, virtual walkarounds work well — but before participating in an online auction, I recommend you go and inspect the machine onsite. Every item at an auction is there for a reason — you need to determine why. Some companies offer inspection services, but if you read their terms and conditions, they indemnify themselves from a majority of the responsibility. That's why when it comes to auctions, I say to always go inspect.
If you're a winning bidder, you'll receive an invoice that usually requires payment between 24 and 48 hours after confirmation.
THE FUTURE OF ONLINE EQUIPMENT PURCHASES
Currently, I use software to assist in diagnosing and reviewing machine conditions using my computer and a technician's cell phone — it's all done remotely. I can guide the person as they conduct a walkaround. I can also upload information, or take pictures and video as we do inspections. This same technology can be used with retail customers to virtually conduct a walkaround with any of our Volvo Certified used machines at one of our four centers.
Down the road, I believe technology will change how we interact and represent equipment to customers. The current pandemic has created an opportunity for us to further build on and create trust in used equipment, even with travel restriction barriers. For Volvo, we had already implemented the Certified Used and Inspected program, which guarantees the condition report and eliminates the need for onsite inspections.
This program has been in full operation for the last two and a half years. We add value for customers because we fully assess the condition of the machine and remove the risk of the unknown. Our process takes place at the dealer level, but is backed by the manufacturer. Under the program, we provide the information, guarantee the accuracy, and then the machine can be transferred to the customer with the assurance of our guarantee. Now more than ever, you have to be adaptive and offer products with easily assessable information. Customers have to be able to trust the process and the product. That's what we do here at Volvo.
BUY USED CONSTRUCTION EQUIPMENT ONLINE
With our program, inspection reports are guaranteed, so we eliminate 100% of the need for you to travel to look at our machines. You can browse our full inventory of Volvo Certified and Volvo Inspected used equipment online, then feel free to request a virtual walkaround to see even more of the machine. You can contact us or send us a message using the Contact Seller information in the right-hand column of each individual product page.
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