- Buyer's guide
Maximizing The Value, Marketability Of Used Rigs
Bob Martin, general manager of HDD Broker Inc., says growth in the used HDD market has been stunted by the worldwide recession, but still describes it as "healthy."
HDD Broker is a brokerage firm that advertises and sells rigs for private owners, banks and equipment dealers worldwide.
"We see a used HDD market where some models are dropping completely off the map regarding demand, while others continue to have a very high inquiry rate," Martin says. "Overseas clients are screaming for equipment, and yet find themselves restricted from buying by either their governments or by their banks."
However, Martin says used HDD inventory is up by approximately 15 percent with sale prices down about 10 percent compared to pre recession prices.
"Machines that are getting listed on our web site," says Martin, "are of low hours and recent manufacture. The high payments on these newer machines make them excellent fodder for liquidation by companies looking to reduce their payments and increase cash flow. For the most part, the gap in the used equipment market when there were very few new machines being made has been passed, and the demand now is for machines manufactured within the last four years."
Martin says some buyers will pay more for the convenience of purchasing a complete HDD package rather than sourcing components separately.
"Also," he continues, "the availability of global dealership networks means some brands of drills are in much higher demand than others. There are brands on the market now that are comparable to each other, but the drill with the support of an established dealership network vastly increases its value."
What do buyers look for in a drill rig?
"Educated buyers realize that each machine is unique, and that there are typical things to look for that change depending on the machine being evaluated," Martin says. "Hour meters, for the most part, can be ignored, especially on the older drills. Hour meters are too easy to swap out or roll back. There are telltale signs of age, again dependent upon the make and model that is being evaluated. That is why having an experienced company or individual guide you through the process is so important."
Having found a machine that appears to meet a buyer's requirements, Martin says the first thing to consider is how good is the brand's dealer support network.
"Will you be able to get parts quickly?" he asks. "Are there qualified service technicians on staff that can repair the model of drill being considered? Is an inventory of the most common parts available?"