By JULIE MENO, Strategic Initiatives Manager, FEDERAL EQUIPMENT COMPANY
Surplus and idle equipment can lead to decreases in workspace and work efficiencies for a manufacturing site. These surplus items of equipment often get in the way of operations. You can decide to store those unproductive assets out of the way or offsite which has its own separate costs. You can also store them on-site with other things you are actually using, but you will pay in manpower and response time to move and handle them over and over again while they are in the way of equipment or other goods you need for actual production. Alternatively, you can get paid for them, clean up your workspaces, and reduce response time for things needed in production, all at the same time.
For the past six years, I have managed investment recovery and resource recovery projects for Fortune 500 companies. These companies have surplus or idle assets, in particular, equipment used for manufacturing, processing, packaging, material handling, and utilities for the facility. These projects identify idle or surplus assets, prepare the best value plan for removal and disposal that may include money-saving transfers to other manufacturing sites within their own network, and then execute that plan.
One of my latest projects helped my client in more ways than just a check for idle equipment. When I walked into one of the warehouses where the used equipment sat, I noticed how many pieces were blocking the ability to get other important items and supplies, that they needed, but were stored behind them or on inaccessible shelves. Every time this site wanted to get something down off the shelves, they had to spend time moving, shuffling, and even removing several items from the center floor and placing them outside. This was all just to get to materials and other items they needed for their operations. Also, there were several large crates and gaylords on the shelves and no one had any idea about what was inside of them. They were wasting space and hours upon hours just moving around things that they had no intention to use, to get to the things they needed.
With my team, we created an investment recovery plan. First, we would inventory all the items in the center of the warehouse and hold an online auction. This first auction had approximately 70 items, approximately 50 of which sold for acceptable amounts which brought back around $45,000 in cash to the site. Winning bidders, as part of their purchase obligation, paid a site-approved contractor to have the equipment prepared, picked up, and loaded onto their trucks. We discarded anything that was deemed scrap that was left over and freed up space. We then inventoried the remaining items in the warehouse and plan to hold a second auction of around 100 items. When we complete the load out of the second auction, the warehouse will have an empty center floor and allow for needed items to be removed from the shelves with much, much less labor, and the items will be available as soon as the site requires them. In terms of finances, the buyers will have paid for the removal and handling, the site will have cash returned for unused equipment, and, as an added benefit, an inventoried list of what is left in this equipment and stores warehouse.
In my experience, manufacturing sites often do not know exactly what they have in idle equipment and miscellaneous supplies. People overlook the value-added solution that I and Federal Equipment Company can provide. My team arrives at your location, helps you take back needed space, and offsets costs by conducting online auctions. We do all the hard work and put a check in your company’s hand along with an inventoried list of everything remaining, so your company knows what is available.
About the Author: Julie Meno is Manager of Stratgic Initiatives at Federal Equipment Company. Prior to working at Federal, she was a Continuous Improvement Manager at Thogus Product Company and a Supervisor of Technical Training at Ben Venue Laboratories. She has a BA in Organizational Psychology from John Carroll University and an MBA in Business from the University of Phoenix.
About Federal Equipment Company: Federal Equipment Company is a reliable resource for processing and packaging equipment needs, with over 60 years of expertise working with manufacturers seeking to buy and sell used equipment. For companies with surplus equipment, Federal Equipment Company takes away all the headaches of asset management. We bring deep knowledge of equipment values, supporting accurate appraisals, and advise you on a range of options to optimize the value you recoup. We also offer cash liquidity and fast, expert removal of individual pieces to entire lines – protecting your facility. This activity with reputable companies gives us a continual on-hand inventory of reliable equipment manufactured by leading OEMs. Our market knowledge ensures you buy exactly what you need with fast turnaround.