Friday, June 26, 2015

New or used?

     Free daily tips, information, advice and ideas
     to help you better manage your small business.

     Astute business owners know how to save money. One way is to consider buying used equipment instead of new.

     Massage therapists, Pilates instructors, chiropractors and others can save a good deal of their upfront funds by buying good used equipment instead of shelling out the big bucks for new stuff.

     People in other businesses can do the same. Even if your business is conducted entirely online, you can frequently pick up used computer equipment, printer cartridges, and other things at steep discounts by searching out used items in good condition at trustworthy sources. 

     Example: Mike spotted an opportunity. Over a hundred retirement homes were being built just outside town. In addition, a strip mall was going in nearby. Mike had always wanted a bagel shop, and he decided this was the place and time to realize his dream. His problem was funding. A franchise bagel operation would cost $250,000. If he bought new equipment for his planned operation, it would cost half as much. All Mike could scrap together was $50,000. He went searching through used restaurant equipment dealers, and he hit pay dirt. He found an antique bagel making machine priced at just $10,000. He jumped at the chance, cleaned up the machine, got it in good operating condition, and installed it in the front window of his newly leased storefront. It was a lot of work, but the money saved made the difference. The machine was old and clunky and slow, but bagels dropped out every few seconds into the boiling water and then moved down the mechanical line and onto the counter. Mike's set-up attracted lots of attention--he even got a write-up in a major regional newspaper. People came to watch the operation and take away a sack of his bagels. His reputation spread far beyond the retirement home complex, and business was good. 

     Buying used is not new. Used houses and used vehicles sell all the time. There is a big market for both. 

     Before you bad mouth used, think of the health care industry. It is filled today with transplants of hearts, livers, kidneys, and more. These used organs are life-giving.

     Check your own operation to see if used can serve you as well as new. You might find some money-saving opportunities. 

     It all starts with your business plan. If you project numbers based on new equipment, see how many dollars can be saved by buying used. It could make a big difference, as in the above example.