In the current economic climate, everyone is stretching their resources in order to make ends meet. With this in mind, some manufacturers are helping rental businesses with aging fleets of aerial work platforms get more life and profits from their current units by offering refurbishment programs.
Like rental businesses, aerial work platform manufacturers are struggling to stay profitable in a down market. In a lot of cases, these companies are working hard to maintain business activity with existing customers.
"Like all other equipment manufacturers in this industry, we are facing unprecedented sales challenges during this economic downturn," says Jeff Weido, Terex AWP product manager, scissors. "However, we remain committed to providing quality products, both new and used, to our customers."
Terex has been actively selling used Genie equipment for the past 10 years. "Our used equipment sales channel provides customers with a trusted avenue for purchasing reliable used equipment," Weido says.
On the other side of the coin, Terex offers premium customer support before, during and after the sale. "With our newly announced Genie 360 program, customers can utilize a full range of support services ranging from training to parts to equipment refurbishing. Regardless of the service, customers can expect excellent service and support when they need it."
How does Terex's refurbishment program work? Weido says it's tailored to each customer's specific needs, whether it's a simple paint job or extensive refurbishment. "Our world class facilities work on all brands of aerial equipment, making it easy to manage your existing fleet."
He continues, "Terex AWP's reconditioning program allows our customers to stretch their capital spending, while getting reliable equipment to replenish their aging fleets. Our reconditioning program includes new paint, tires, controls, etc. The useful life of these products is dependent on the various applications they encounter and routine maintenance performed, but typically a refurbished scissor lift can increase its working life by an additional four to seven years."
Not everyone agrees
Some manufacturers have a different philosophy when it comes to the life cycle of the equipment they sell. Haulotte Group/BilJax, for example, does not offer a refurbishment program. "At the end of the first normal life time of our equipment, there is much more money to make in buying a new, up-to-date machine than perform a complete refurbishment," says Tami Becher, marketing and communications manager, North American Zone. "We do not believe that complete refurbishment of an old machine is a long-term winning strategy for a rental company, but Haulotte Group/BilJax can possibly pursue refurbishment for customers on request."
For its part, Haulotte Group/BilJax includes a possession cost analysis in the development process of all its machines and has developed a strategy to invest in customer support throughout the lifetime of the equipment, Becher explains. "For parts, training, technical assistance or planned service maintenance, Haulotte Services is fully committed to help customers in daily operations," Becher says. "Our call centers and on-the-ground network of technicians work together to react as quickly as possible to client demands."
Becher notes that underlying its keenness to ensure the operational readiness of its clients' machines, Haulotte Services strives to dispatch required genuine replacement components anywhere in the world within a minimal timeframe. As such, Haulotte Services has implemented a secure and customized website for an interactive customer relationship. WWW.easy-spare-parts.com will help customers to manage fleet from computer, anywhere in the world, 24/7, Becher says.
Works for some, not all
In short, reconditioning is an option in some cases, but not all. It is simply not cost-effective to refurbish some lower-priced aerial work platforms, says Steve Hornbaker of JLG Industries Inc., which mainly focuses on reconditioning boom lifts, not scissors.
"Models that are 40 ft. and above make up the bulk of what we do," says Hornbaker. "When a customer owns a machine and the maintenance costs begin to climb around the seven-year mark, they can send it to us and we'll rebuild it. The cost is around 35 to 40 percent of what a new unit costs, depending on the model. An 80-ft. Model 800S, for example, can be done very cost-effectively. You could buy a new model for $120,000, while reconditioning costs around $35,000."
Hornbaker says once it's reconditioned, a JLG lift is like new and customers can expect to get as much life out of the machine as they could from a brand new model.
Whether or not refurbishment is an option for your rental business depends on a lot of factors.
"Everybody does their books a little differently," says Hornbaker. "Wall Street likes to see bigger returns on rental. There's less emphasis on equity. Some think wealth is the value of the machine, so they'd rather sell it at the right point in its life cycle. Other companies like to see a wide profit margin on rental equipment," so it pays to keep a machine running as long as possible.
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