Equipment Appraisal Blog | Understanding Machinery Appraisals

5 Reasons Why You Need a Plant Process Asset Appraisal

Posted by Equipment Appraisal Services on Mon, Nov 25, 2019 @ 08:00 AM

plant processing

Your business is manufacturing, and you take pride in knowing how much productivity you get out of your production line every minute, hour or day. But do you have the same intimate level of knowledge about the value of your manufacturing plant equipment? Plant process asset appraisal is the process of determining the value of your manufacturing equipment, either in individual pieces or as a whole. Here's a quick look at some of the important reasons why you should have your production line appraised.


5 Reasons Why You Need a Plant Process Asset Appraisal

  1. Some equipment is appraised together with the rest of a production line. When another business is interested in purchasing an entire production line, being able to purchase that entire line without having to find the missing pieces has value. Instead of having to find additional equipment, they can purchase everything at once, which is worth a premium. An appraiser knows how grouping that equipment can raise its overall value to a potential purchaser.
  2. Some equipment is appraised separately from the rest of your assets. Sure, your welding robots and their infrastructure and framework all need to go together when they're sold, but what about the computer that runs them? It can be hard trying to determine which parts of your production line need to be appraised separately. A qualified equipment appraiser knows when to separate equipment for appraisal and when they should be left together.
  3. You don't need delays when you have to file an insurance claim. Even if you don't know what your equipment is worth exactly, you know how much it costs your business every minute that production line is still. When you have an equipment failure and need to file a claim, you want it resolved quickly so that you can replace that equipment and get on with your business life. An equipment appraisal speeds up the process by providing proof of value to your insurance carrier.
  4. You need to grow your business but your business credit isn't that great. If you need to secure financing for a great opportunity or expand your production line, one option is to offer your production line as collateral for the loan. When you have an equipment appraisal performed by an accredited appraiser, that information holds up well to strong scrutiny, even in tough financial circles. 
  5. The equipment may not be valued properly in your accounting books. Many businesses simply depreciate equipment based on government tax forms. However, even once that equipment has been fully depreciated, it may still remain productive, delivering income to your business. It would cost a lot to replace that machinery. An equipment appraisal tells you exactly what the equipment is really worth to your business.

A plant process asset appraisal can help you get a grip on exactly what your production line machinery is worth while serving as a solid proof of value for legal, insurance, tax and financial purposes. However, having the appraisal performed by an equipment dealer means that the figures may be skewed based on their interests. When you work with an independent accredited equipment appraiser, you have the peace of mind of knowing that they have no interest in the outcome of the valuation report that they prepare and that you can trust their calculations.

Tags: Plant Process Appraisal

What Are Some Common Points in All Kinds of Crane Valuation?

Posted by Equipment Appraisal Services on Mon, Nov 11, 2019 @ 08:00 AM

Valuation of Cranes

Crane valuation can seem like a complicated process, especially when there are a range of different types of cranes being considered. However, there are also a certain amount of common areas between all types of cranes. How does the condition of these different areas impact the overall value of the crane? Here's a quick look at common points in crane appraisal, regardless of the type of crane that is involved.

What Are Some Common Points in All Kinds of Crane Valuation?

  • Types of Cranes Appraised: What kind of crane is being valued? There are a wide range of different crane types, which often have very different values. Maybe you need a telescoping crane valued that is used for transporting materials to areas of different heights. A crawler crane used to navigate poor soil conditions may have very different appraisal points than a tower crane used to lift materials up to the top of a skyscraper. Knowing what type of crane is involved helps the appraiser move on to the next steps.
  • Hydraulics and Mechanical Systems: As the heart of any crane, poorly-functioning hydraulics or mechanical systems can lead to early failure or reduce the expected useful lifespan of the equipment. The appraiser will take a solid look at the functionality of the equipment, possibly taking into account fluids tests, stress tests and video to determine whether everything is functioning as it should be.
  • History of Repairs and Maintenance: Time to dig out your maintenance and repair logs! By looking over this paperwork, the valuation specialist can get a good picture of whether the equipment has been properly maintained and whether it was immediately taken out of service when a problem was noted or if it continued in use, which may impact its expected remaining useful lifespan, which in turn will impact its value.
  • Manufacturer and Model: Just like cars, some manufacturers and specific models will have a reputation for longevity and durability, while others do not. This information will be taken into account by the equipment appraiser during the valuation process as they consider how well that manufacturer and model have held up in the field in the past. As you may expect, equipment that performs well for a longer length of time has a much better value than equipment that performs poorly or fails early.
  • Additional Kits or Options: If you've upgraded your equipment after you purchased it or paid more for specific options, your equipment valuation specialist will take that additional value and functionality into account when the crane is being valued. This can include an upgraded radiator kit to improve cooling, a stronger hydraulic system for a boom or any number of other options that may have been improved during or after purchase.

By having a better idea of how crane valuation is approached regardless of the type of crane involved, you can make a better judgment call when purchasing your next crane. But what if you need to know the value of a crane that you currently own or are considering purchasing or selling? If you're making this type of investment in your business, it's important to have an equipment appraisal performed by an accredited valuation specialist. Working with an accredited appraiser ensures that your interests are protected during the process.

Tags: Crane Appraisals