Read the full episode transcript
00:00:01 Ivan Buckner
Hello and welcome to Power Bytes. I am your host, Ivan Buckner. Today's topic is a topic that many of our listeners are facing: When should I decide to purchase a used generator? And today we have Ed Loud, Sr., with us from Carter Machinery. Ed will help us answer the question, “When to use used?” Ed, welcome to Power Bytes.
00:00:24 Ed Loud
Thank you for inviting me to the podcast, Ivan. I'm a pretty passionate person about the used power business. I’ve been in the used power business for over 25 years – currently working at Carter Machinery based in Virginia. I've been at this dealership for over 5 years but in the Cat network for over 24 years. I’m really enjoying it!
00:00:45 Ivan Buckner
Well, Ed, we're glad to have you on the show, and I thank you once again. Tell me a little more about your role at Carter Machinery.
00:00:53 Ed Loud
At Carter Machinery, I am responsible for buying and selling used power equipment and generators for our dealership, including portable and stationary units. Our dealership covers all of Virginia, most of Maryland,14 counties in West Virginia, and then two counties on the Eastern Shore of Delaware. In addition to managing a very large rental fleet, I also handle trade-ins and de-fleeting rental units.
00:01:17 Ivan Buckner
That's a large territory you're covering there. Recently I had a decision I had to make when my daughter's car was totaled. I want to compare the decision-making process with the factors involved in purchasing a used generator instead of buying a new one. Why would someone purchase a used generator instead of a new generator?
00:01:38 Ed Loud
There are several reasons why someone might consider purchasing a used generator instead of a new one, such as availability, timing, generator size, and most importantly, budget. It's always about the budget, right, Ivan? For example, let's say you have a production facility that has experienced significant growth and needs to expand rapidly. To increase production, the electrical contractor recommends increasing the generator from 500 kW to 750 kW – or even higher, such as 1,000 kW. So, you must decide to either purchase another 500 or 250 to get up there at 750 – you might consider a used 1000 kW generator.
00:02:24 Ivan Buckner
There are several factors when considering a used generator. Could you explain how timing plays a role when a customer is making that decision?
00:02:34 Ed Loud
Ivan, I feel that timing is very crucial! Say, for example, you consider purchasing a new unit after your company’s grown. Yet the new unit is not available for a considerable amount of time. It might benefit you to consider a used generator. Is the used generator currently available? What are the specifications? How much does it cost? Will buying used save you money? Just like the situation with your daughter looking for a vehicle: the new unit may not have the desired trim level, but a used car lot might have exactly what you need. In the context of your company growth, time is of the essence. You can't afford to halt production waiting for a generator. So, you have to make those decisions.
00:03:14 Ivan Buckner
Some people believe that used generators offer a different quality. Can you discuss how your team prepares used generators for sale?
00:03:23 Ed Loud
I certainly can, sir. I think that that's a big misconception out there: that used is not high quality, but that's not the case! Here at Carter Machinery, when it comes to generators, we'll take in portable or stationary. We will go through it, we will clean it, we will touch up the paint if needed. We'll also perform a PM - preventive maintenance – that’s an oil change and all fluids changed. We will load test it. (A load test is putting the generator at its fully rated kW and amperage and voltage.) We’ll load test for a minimum of one hour. And before we do that PM change, we will do an oil and coolant sample and provide a load test report, oil and coolant sample reports, to the customer. And that's what we do here! It's pretty much standard out there in the industry.
00:04:22 Ivan Buckner
Talk to me about the importance of physically seeing the product.
00:04:27 Ed Loud
When we get a lead for a used generator, we always encourage the customer to come and visit that generator where it sits in one of our yards. It's always an option. Another option is for the customer to witness a load test. We had a customer recently drive down from Pennsylvania to look at a 230-kW portable genset that was in our rental fleet. He came down and inspected it. He really liked the unit. The unit had 4,400 hours on it. He was going to be running it for a few more years, and he asked for a warranty for up to 10,000 hours. Through Cat Insurance and a multi-point inspection – oil and coolant sample, load test, Omega tests on the generator end to ensure everything was operational – we were able to provide him with a warranty for up to five additional years and 10,000 hours.
00:05:25 Ivan Buckner
Let's say that customer wasn't physically able to come in and inspect the generator. What alternatives can you guys provide to assure a customer that they're buying a good quality used generator?
00:05:38 Ed Loud
We can provide customers with multiple pictures, sometimes in multiple emails – all dependent on what they're specifically asking for. For pictures: the full corners of the unit, the outside, the inside, the engine, data tags. We can also, when we're doing that load test, do a walk around video of that load test and show the particulars and the gauges (and all that) of the unit actually running during that load test.
00:06:07 Ivan Buckner
Besides a warranty, are there additional services available when purchasing a used generator?
00:06:13 Ed Loud
When selling a used generator in territory, we can provide a service contract, a maintenance contract. Our parts and service reps, in some cases, are notified before the customer takes actual possession of the generator, and we're already offering them a service contract for that in some cases. In other cases, it's done after the fact. That's an added value, in my opinion, for the customer’s ease of mind: that that generator is going to last for many years.
00:06:48 Ivan Buckner
This has been a great conversation. We're almost at the end, as far as time. For our listeners who may be facing this same decision, what key things should they be considering when buying a used generator?
00:07:01 Ed Loud
When you're looking to buy a used generator, you're asking yourself these questions before you’re even making a call: What is the age of the generator? How many hours has it ran? Where is it located, and what was it used for in its previous life? Can the dealer provide a load test? Do you have the service records? What is the fuel source, and what size is that fuel source? In the case of a diesel, what size fuel tank? Does the generator come with a warranty? If not, can a warranty be purchased? Is there a service plan available? Is the unit available today? Is the generator within your budget?
00:07:43 Ivan Buckner
These are some excellent questions to consider when buying a used generator. I saw a significant correlation when deciding on a vehicle for my daughter. In the end, we chose to buy a used car. Is there anything else you would add to “when to use used”?
00:08:01 Ed Loud
No, I don't think there's anything else I need to add. I just wanted to thank you and your listeners for listening to us today. I sure hope that we've helped them for when it's time to make a decision to buy a used generator.
00:08:12 Ivan Buckner
Ed, thank you for taking time out of your day.
00:08:14 Ed Loud
Thank you.
00:08:16 Ivan Buckner
Well, thank you guys for listening to Power Bytes. If you have any questions or suggestions for new topics, please contact us at powerbytes@cat.com. Thank you.
