If you're a mine owner and need to expand operations or upgrade production capacity then considering the purchase of used mining equipment just makes good business sense. For a mine to operate under a strict budget, one of the best methods to save money is to buy used mining equipment versus new. There are many reasons that the used equipment to process metallic or non-metallic materials becomes a strategic advantage and could impact bottom line profits.
Here are four reasons you should consider used mining equipment over buying all brand-new equipment.
1. Get Quality for Less
In just about every case, buying used industrial equipment costs significantly less than buying a new piece of equipment. This is also the case when dealing with equipment needed for any type of mining business. If you're a small operation or you're looking to get the best brand of equipment out there, you'll get more for less when you go with used equipment.
The price difference between new and used equipment can be significant. Much like buying anything new, the value of a new mill loses a considerable amount as soon as it is put into production. You could pay 30% to even 70% less for well-maintained equipment for mining that has minimal hours or operation.
In a world where mining is under stress and the future of mining is uncertain, it's important to stay competitive with quality equipment. However, without the help of a used market, it's hard to find equipment that's reasonably priced. To stay in business and show investors that you're serious about what you do, have high-end used equipment at your disposal.
2. No Need To Worry About Lead Times
Buying high-end machinery or equipment requires long lead times from machinery dealers. They can be inconsistent when buying new mining equipment. This is because shipping can be slow, parts might not be on hand, recent tariffs could have impacted available parts or it can be hard to get a hold of raw materials.
These are all excuses that you don't want to hear when you're trying to manage a mining operation. While you're worried about your own staffing and productivity issues, you can be thrown a curveball while you're waiting for manufacturers to deliver the needed equipment.
Used equipment is usually immediately available for mining operations if you have a large used equipment supplier like Machinery and Equipment sourcing new equipment daily for you. Buying is usually a quick and easy process. When it suits your needs and fulfills the use that you have for it, you can act on a purchase immediately.
Purchase and installation are streamlined when you buy used. Lead time can be just around two weeks, which is a breeze compared to buying things new. You could wait six to twelve months in lead time for a piece of equipment that's being manufactured brand new.
3. Think About Depreciation
As stated above, driving a car off the lot causes the price to depreciate rapidly. You'll lose value on a piece of mining equipment as soon as it arrives on your mining site. The only way to avoid depreciation is best managed by buying a quality used mining equipment that has already been devalued from the showroom purchase.
While some new equipment will drop in value by 20 to 40 percent in that first year, after that, their value tends to stabilize. That means that whatever you purchase that's more than a year old is going to be at its best value. So long as the equipment is well-maintained, you won't have to worry about any major depreciation.
It also means that the resale value is fairly high. If your mine needs to sell unused equipment or upgrade to newer production pieces, you can sell your current equipment and get something else.
Another reason for purchasing quality used mills, crushers, flotation circuits, kilns, dryers and conveyors that haven't depreciated is that you're always going to be looking for investors. Keeping a mine up and running costs money and you'll need a cash injection from time to time. If you have equipment that hasn't depreciated and represents a high present value, you'll be able to increase valuations and obtain a better appraisal of your mining operations.
4. Look At Maintenance Records
When you're buying a piece of used equipment, you can look at what the maintenance records have to say if they are available. This can let you know how the equipment has been used and what you can expect out of it in the future. If you don't know whether to invest in a certain tool, the maintenance records can clue you in on what to expect from it in service costs.
A piece of equipment that has a high number of issues in its first couple of years can be a red flag as to why it's being sold. You can also see if it's had any updates or modifications. A used but recently updated machine might be worth more than a used piece that's just a year old.
You don't get this kind of access to information with new equipment. Buying a used crusher can be more informative than buying a new crusher.
Used Mining Equipment is an Ace in the Hole
When you choose to buy used mining equipment, you can save a lot of money on keeping your mining operation running at peak capacity. It costs a lot to keep any mining operation running but when you can cut costs, you can ensure that you make a solid profit year after year.
For more on how you can expect the mining industry to grow, check out our latest coverage for tips.