A conundrum that faces many business owners is whether to go with new or used equipment when something needs replacing.
Numerous things have to be taken into consideration before reaching a decision. There are pros and cons to whatever you choose. Knowing what these are beforehand will put you in the best position. You might think that buying new is the best option because technology changes at such a rapid rate. However, that’s not necessarily the case. First, you need to ask yourself what you want the equipment to do for you? Is it to help deal with an increase in orders or are you looking more long-term?
The Pros and Cons of Buying New
If you’re planning on keeping your equipment for a long period of time, then new is the right choice to make. There are going to be far fewer chances of it breaking down, and even if it does, then you’re covered by the warranty. For many types of new equipment, there are tax breaks you’ll be able to take advantage of, and a company such as Tax Return will be able to provide advice.
Are you concerned about the image of your brand? New equipment will give you a more professional one and help to build customer confidence.
One of the biggest downsides of buying new equipment has got to be the price, however. The full cost has to be paid upfront, which is not always an option if your budget is tight. You may also find that you’ve got quite a wait because there is a backlog of orders. You also need to be prepared to take a huge knock in depreciation.
The Pros and Cons of Buying Used
Buying new isn’t an option for all business owners and used equipment does have its advantages. There are some great deals out there for used equipment, and you can easily get something that’s almost new for a fraction of the price. It means that someone else will have had to absorb the cost of depreciation.
Just because something is used, however, doesn’t necessarily mean it’s unreliable. Check out lots of different suppliers because some offer guarantees, support, and extended coverage. With prices much lower, you can afford to purchase more equipment and increase production further.
There are, of course, a number of disadvantages to buying used equipment. You have to be very careful who you’re buying from because anyone can sell used equipment. It will be uncertain how the equipment was cared for, used and maintained. You can cut the risk by asking the owner about the item, but you will be relying on what they say is true. Used equipment is likely to be out of date, although there are exceptions to this general rule. Always weigh up the options of a newer version before handing over any cash. Sometimes, you may get a warranty included if you purchase from a dealer, but this is not always the case.
There are pluses and minuses to both used and new. As a business owner, you have to weigh up the options and decide what is best for you.