It was only a few short years ago that we were selling used MAC 2000 Profiles for $4000 per fixture in a two way case. Now it seems we are lucky to get $900 for them. An M7CL48 in very good condition with a case was selling for upwards of $10-$12,000.00. Now we see them sell for $5000-$7000. Many companies have an abundance of aged gear that is taking up space in their respective warehouses. Soon it will hit the dumpster as a loss.
How has this happened and what can you do to stop the bleeding?
First, it’s important to realize that every bit of equipment you purchase is an asset for your company. From the beginning to the end of its shelf life it has a value. As a business, you must depreciate the asset’s value over time (your accountant will consult with you on how to do this ). Just because on paper it may have a value higher than you can sell it for, you must look at the income it has produced over a said period of time. If that income plus the amount you can receive for an asset in today’s market is greater than the amount you paid for the item, go ahead and sell it. Don’t worry about depreciating it further.
I’m not saying that you should sell all of your gear after 3 or 4 years, but putting together an exit strategy plan up front for each item you acquire, is essential in today’s market. Technology is speeding up, whether it’s audio, lighting or video products. The longer you hold on to something, the more chance you take on that asset becoming irrelevant before you can recoup any money for it.
At GearSource we will help you with your strategy. Our team can give you firsthand information of what your asset may be worth in a few years and when a good time to sell it will be. Give us a call to discuss this important element of your overall business strategy.
Sales Representative GearSource.com®.