Thursday, November 1, 2018

Purchase of Power Equipment: 9 Useful Tips

The right equipment can help your business weather economic downturns. On the other hand, a bad purchase can affect your ability to compete.

It is better to evaluate the advantages and disadvantages of each purchase. This includes the return potential of the invested capital. Buying new equipment is not always the best solution. It is sometimes better to rent the equipment or not to buy it.

However, do not be put in the trap of avoiding the purchase of equipment simply because the economy is unstable. The right equipment can help you improve your processes; increase your productivity and your ability to innovate as well as your bottom line. But to achieve these results by making significant capital investments, you need to adopt an investment plan that establishes your needs in the short and long term. You will save both time and money, and avoid costly quick fixes.

1. Assess the situation of your company

The first step is to clearly identify your goals. Do you want to increase your productivity? Will the new equipment help your success in the market? Will it help you stay ahead of your competitors? Is there a need to buy new equipment to improve performance - would upgrading existing equipment be just as good?

Make sure you have answered these questions before moving forward. Avoid being influenced by catchy marketing campaigns that promise the impossible. The power equipments at my deal must have tools in your home and office as well.

2. Get an opinion from the outside

Depending on the size of your investment, it may be worthwhile to collaborate with an external consultant who will ensure that you make the best possible purchase by evaluating your needs with you. As a first step, you will examine important factors such as capacity, employee use and your current resources. The most common approach is to conduct a cost-benefit analysis to justify the acquisition of equipment and to determine the advantages and disadvantages.

If you work in the manufacturing sector, you could use the asset operating ratio, which measures your ability to use equipment and other assets optimally. It is assumed that more efficient equipment will help you achieve better results.

3. be innovative

To succeed in today's competitive business environment, you need to be innovative in all your business activities. Innovation is essentially an imaginative way of coping with change; it may include acquiring equipment or technology that will help increase your efficiency. For example, the purchase of new equipment could help you streamline your operations and develop better products and services that will appeal to a niche market or it could facilitate your R & D activities or improve service to your customers. The customer. It's always good to show your clients that you're investing in innovation;

4. Examine your entire business

Instead of making isolated purchases, look at your overall operating needs. Short-term purchases made without a long-term plan are expensive and do not necessarily give the best results. An external consultant can perform a business process review to help you understand how your business works. This review allows the consultant to design a solid plan that will ensure the smooth running of your operations and avoid waste.

With a plan like this, you do not have to tackle a whole process; you're able to focus on improving just one activity in your business at a time. You could ultimately improve turnaround times, efficiency, or other aspects of your business. If you conclude that you do not need to buy new equipment at all, you could use savings - or money you did not have to spend - to make other investments in your company.

A consultant can also help you anticipate human resource issues that arise from the purchase of new equipment. For example, if the new machines make some posts unnecessary, will you be able to reassign employees to other positions in the company? Will you be dealing with higher costs due to severance pay or training? Will collective agreements prevent you from reassigning your staff?

In addition, it is important to ask yourself if the equipment you are replacing could be used elsewhere in your company. For example, computers that are no longer sufficient can often be reused in services where the work requires high-performance computers. Similarly, in the field of electronic data processing, the most recent technology is not necessarily the best. To avoid unnecessary setbacks, it is not uncommon for companies to buy the second or third version of a new software package, after the first buyers have discovered the bugs. Carefully assess whether the new features offered by state-of-the-art equipment will really help you.

5. Suppliers: look for the most advantageous offer

Take the time to browse the Internet, where there is a wide range of companies specializing in the supply of equipment. View newsletters for specific industries and visit trade shows where you can try out the proposed equipment. You can also contact industry associations for more information. The price should not be the only criterion that guides your choice of supplier. Also consider important aspects such as after-sales service and vendor reputation, and get referrals. If you are a loyal customer, you can ask for more favorable benefits or an extended customer service program.

6. Do not forget the training

Too often, entrepreneurs forget to consider the time, money and resources that will be required to teach employees how to use new equipment. You need to avoid a decline in productivity caused by employees taking too long to adapt to new technology or processes. If the equipment is new or has new features, you can rightly assume that there will be a learning curve. It is important to eliminate any problem by providing the necessary funding to cope with the slowdowns or downtime it will cause. You will need to schedule training periods while making sure that your business can continue as normal.

7. Carefully choose your financing method

Each mode of financing has its advantages and disadvantages. You must carefully evaluate each option. The factors to consider in choosing the method of financing may vary from one company to another, depending on its credit history or industry sector.

The purchase of equipment gives you ownership of it at the end of the transaction. Your company amortizes the cost over the life of the equipment. You could even get financing beyond the cost of purchase. For example, BDC provides funding of up to 100% of the purchase price and the possibility of obtaining additional funding to cover installation, training and transportation costs.

Leasing may allow you to first lease the equipment for a specified period of time and thus pay less for you than if you bought it. You will not own the equipment, however, and your company will only have a purchase option when the contract ends. The purchase price at the end of the contract may be less than the price you would initially pay to buy the equipment, but since you also made payments under the lease, this option may be more expensive, in the long run, than other options. Depending on the terms of the lease, your payments could be included in the operating expenses.

Rental may be more suitable for equipment that becomes obsolete or is required for a specific project. Leased equipment is not considered capital property and can therefore be quickly exchanged or returned at low cost.

8. Think "security" first

A healthy and safe work environment allows your employees and your business to be more productive; this rule also applies to your purchases of equipment and technology. Your suppliers have an obligation to sell you equipment that can be used safely. For your part, you must make sure that your employees respect the security rules. To find out more about this, visit Human Resources and Skills Development Canada's Occupational Health and Safety website.

It is also good to ensure that office equipment, such as furniture, is ergonomic and therefore designed to reduce the risk of injury and discomfort for employees while aiming to make them more productive. . There are two standards that describe the principles of ergonomic design for office equipment such as computers. These are ISO 6385 (International) and CSA Z412 (Canadian) - Office Ergonomics.

9. Be concerned about the environment

When buying equipment or technology, make sure he or she is energy efficient. You will save money while protecting the planet. Learn about the environmental footprint of your new equipment and how you can dispose of existing equipment in the most environmentally friendly way possible.

Investing in the right equipment is a complex task. An outside consultant can help you get an overall picture and plan your purchases so that your new equipment contributes to the prosperity of your business in times of instability.

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