Is It Better To Buy A New Forklift?

 When it's time to buy an expensive piece of material handling equipment, most decision makers are going to weigh the pros and cons of purchasing new vs used. In fact, when you plan your annual budget, you've probably included a line item for additional needed forklifts and other material handling equipment like stackers, order pickers, reach trucks, utility carts, aerial lifts, yard ramps, jacks and more. Perhaps you had the discussion about the advantages of buying new vs the advantages of buying used at that time. It's just good business sense to plan ahead and buy the big items on a planned schedule when you can take advantage of sales and tax breaks. One thing is for sure, though. You don't want to get caught with serious downtime while you debate the pros and cons of new vs used.

Obviously, a used forklift is going to be less of a hit to the bottom line - at least at first. Therein lies the caveat. The advantages of buying new material handling and distribution center warehouse equipment boil down to cost and features. Let's take a closer look at how these items can affect your purchase decision.

Cost: There's More To It Than A Price Tag 

When people decide to go into debt to pay for a college education, they're looking at the extended picture. The hope is that the debt will pay off in the long run with a good paying and interesting career. But there's no guarantee. When purchasing new material handling equipment, you should be getting a guarantee from your equipment dealer that if the equipment doesn't perform like it should, you'll have an avenue for addressing the issue in the form of a warranty. Some used equipment will come with a partial or limited warranty, but it's never going to match up to the coverage you can expect to get with new equipment.

Most insurance companies are going to charge more to cover a well-used building than a brand-new facility. It makes sense because there are more likely going to be more claims against an old building than a brand new one. Insurance premiums are another place where the cost of new vs used comes into play when purchasing material handling equipment. Even though a new piece of equipment costs more upfront, you'll realize savings in your insurance premiums.

Almost everything we buy depreciates over time. With this loss of value guaranteed, how does buying new material handling equipment help? The good news is that when you buy new, you'll see most of your depreciation in the first year of ownership, leaving several good years of ownership left before you sell or trade it in - sometimes recouping close to what you've paid. With a used forklift, the depreciation is built in and won't be benefitting you. Keep in mind that what you'll be able to resell your forklift for is in direct relation to how you treat, maintain and service your equipment.

We're going to factor in another, more hidden cost, and that's the cost to your time - and your stress level! Buying a new forklift comes with a higher price tag upfront, but way less stress and questions when taking into account the risk of buying used, as well as researching history reports (if the equipment even has that).

When making a large purchase for your material handling or DC warehouse operation, the bottom line for cost is ROI - return on investment. A good ROI justifies the expense. With a new forklift, you'll be able to measure a positive ROI in several ways, including increased productivity and efficiency, optimized uptime and a longer life. 

Applications: Factoring In The Features 

If you were a parent on the hunt for a car with a beginning driver in the family, most likely you would be looking for a vehicle that has the best safety features. Putting safety first in your business also pays off in many ways - not the least of which is making sure that everyone goes home healthy after their shift.

Safety is one of the main reasons to purchase a new forklift rather than buy used. You've no doubt noticed that material handling equipment technology has changed by leaps and bounds - and much of that change is geared toward improving safety and the health and well-being of those charged with operating that equipment and working around it.

From better ergonomics that reduce workers' comp claims to intelligent safety features that can be accessed anytime from your phone or computer, today's forklifts and other equipment choices are designed to reduce accidents. This isn't just beneficial to your employees - it helps you make sound business decisions when deciding how to use your equipment. With a new piece of equipment, you'll know the history - there's no guesswork on safety features involved.

Upgraded features all around make newer forklifts and other material handling equipment models more attractive. With constantly changing and innovative technology designed to answer today's material handling challenges, when you buy new you'll find solutions to issues such as fuel and battery usage, green initiatives and much more.

Everybody's material handling application is different and unique. When you choose to buy a new forklift, you can not only pick one that has exactly the features you need, you can customize it to meet your specifications if necessary. Acquiring a piece of equipment that complements your business model will save you money, enhance productivity and maximize efficiency. It is also important to calculate potential tax saving with Section 179 and Bonus Depreciation for both new and used equipment.

If you are in the market for material handling equipment and on the fence about purchasing new or used, contact the professionals at Southwest Materials Handling Company today. We'll be happy to take a comprehensive look at your specific application challenges and give you some options.