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A large chunk of operational costs of running a construction company is the purchase of heavy construction equipment. When it comes to disposing of your construction equipment, you need to sell it at the demand value; otherwise, your equipment will sell at a scrap value. However, it is complex to appraise your equipment value accurately after using it for several construction projects and the resulting wear and tear. Sometimes, you need to appraise your equipment for insurance purposes. After using your equipment for some period, its insurance value should decrease proportionately with its depreciation. In this regard, you need a qualified and experienced equipment appraiser. Wiley Financial is certified and reputable and provides authentic appraisal reports and certificates for all types of construction equipment appraisal.
Consider servicing it before contacting the appraiser if you want your equipment to fetch the highest appraisal value possible. Ensure that your construction equipment is in top shape by performing the required repairs, lubricating the movable parts, and general cleanliness.
Ensure that your appraiser is fully certified and has the relevant experience performing similar tasks. Checking the credentials will prove that your appraiser has the necessary information and the required experience. Reliable appraisers are always willing to present their certifications and portfolio to their clients. Wiley Financial is certified and has a long track record apprising heavy construction equipment.
During the date of your equipment appraisal, ensure that you are present. If you have a technical staff with construction equipment knowledge, ensure that they are present. If the appraisal value does not seem to meet your satisfaction, don’t be afraid to ask questions. You may need to answer questions from your appraiser regarding equipment service records and all previous maintenance.
It is infrequent to find construction equipment in its stock condition. Most construction companies increase the value of their equipment by adding several modifications with time. If you have customized your equipment by adding some tweaks and modifications, it is important to note them down and inform your appraiser. These upgrades will have a positive impact on the value of your equipment.
If you want to make your appraisal process more efficient and smooth, consider having all your equipment records. These documents include logbooks, purchase receipts of equipment parts, upgrades, and repair and maintenance records. If you have all these records with you, your construction equipment will increase.
Before performing your equipment appraisal, consider the reasons for establishing its value. You may want to perform equipment appraisal for tax assessment purposes, buying or selling, and insurance purposes. Depending on your needs, the appraiser will decide on the best appraisal method for your equipment. Wiley Financial employs the following methods for heavy equipment appraisal:
An equipment appraiser may employ this method to evaluate used construction equipment. The method relies on the prices of similar equipment in the region. Your appraiser will consider equipment quality, age, and lifespan in this method. Because your appraiser will consider the stacking up of your equipment, it is a more beneficial method than considering its book value.
The method considers the residual value of your construction equipment. Although equipment generates less Return On Investment (ROI) over time, it still has potential when selling it. By considering the equipment’s lifespan and age, an appraiser may determine the income equipment will generate for a construction company. The income to be generated by the equipment will determine its current value. The information will enable you to determine the resale value of your construction equipment.
The cost method is best used when construction equipment is outdated or unique. The method considers the quality, age, and lifespan of construction equipment. Using the cost of purchasing the equipment, an appraiser can determine its residual value by calculating the depreciation with age.
It is essential to conduct due diligence before performing your construction equipment appraisal. The tips above will help you with the best ways to prepare for your equipment appraiser and get the best value possible according to your needs. At Wiley Financial, we have the relevant knowledge and vast experience appraising heavy construction equipment. Reach us out today for the best professional appraisal services.
Wiley Financial Services is a full-service accounting firm, specializing in Business Appraisals and Business Valuations, that has over 20 years of experience with a variety of industries ranging from restaurant, biomedical, manufacturing, advisory firms, nurseries, event design firms, IT firms, and many more. Wiley Financial is based in Oceanside, CA and we primarily service clients across the Western United States from our San Diego office.