Set out below are a few examples of our recent work.
Growing manufacturing company bringing in new equipment and replacing plant no longer required
This medium sized engineering company no longer required an ABB robotic welding cell and, being short of space, had committed to buying some new equipment which, when they first contacted us, was arriving in 6 week’s time – sure the arrival could be delayed, but our client wanted to avoid this. Ideally, to get the best price for our client, we like to have more than 6 weeks to expose an item to the market, hold an online auction, complete a sale and secure the removal of the sold equipment. Our client’s management team were under significant pressure managing the company’s growth. We needed to attract the attention of the market quickly. To do this we prepared an online brochure, giving buyers an opportunity to buy before any online auction and thereby avoid paying any buyers’ premium. The brochure was exposed – very quickly indeed – to the market using a variety of means (which because it’s our IPR we will not be going into here – suffice to say time and time again it’s been proven to work). The eventual outcome? – A win-win outcome for our client, the buyer and us – the client received 60% more than the minimum price he needed to achieve to satisfy his finance people (and that was after our fees!) and the cell was out of his factory just one day late; the buyer bought a cell for the fraction of the price of new and avoided the OEMs’ long lead times; and we were paid our fees!
The moral of the story?
We have tools in our armoury to deal with those situations where we don’t have the time we’d like to put clients’ plant into a formal online auction, tools which still achieve a really good outcome for all parties.
International Manufacturing Group
This well known group had a good amount of surplus plant that was taking up much needed space. Our brief was to dispose of it through an online auction. The factory was cleared at no cost to the client – our fees were paid out of the sales proceeds, leaving the client to pocket several times the reserve/scrap price.
Black Country Manufacturing Company
This medium sized company was sitting on plant that had passed, at least for them, its useful economic life and needed to free up space to integrate a recent acquisition. The brief was to dispose of it through an online auction. Most of the items were sold to manufacturers in the Balkans and the Far East. Much of the remainder was sold by private treaty to buyers we had identified outside of the auction environment, what was left was simply scrapped. This outcome was achieved at no cost to the client.
Our client had ‘inherited’ several items of low individual value plant on its acquisition of other businesses, which had only ever been stored, and as a result was in need of a Spring Clean. The brief was to dispose of the items through an online auction. Some were sold during the early months’ auctions to foreign buyers at up to 18 times the reserve, much of the remainder was sold by private treaty at several times above scrap price to buyers who had been attracted in by the online auction, the rest was scrapped. Again, there was no cost to the client. The moral of the story is if an item does not sell first time, it can simply be relisted, at not cost. If after say 2 relistings it still has not been sold, the market is telling you something.
Welsh manufacturing company
This internationally renowned manufacturer had arranged for some new machinery to be delivered into its factory as part of its ongoing investment in the business. With its focus on the arrival of the new stuff, the disposal of the line it was replacing hadn’t received much attention. This ‘old’ line included 3 machines which were over 20 years old, and had been fully depreciated. It couldn’t be worth much, could it? Well, it was. You see, these 3 machines are from a well respected OEM, and had many years of profitable use left, they’d not been worked hard. But there was a lot more to the line than that. This was an automated line, one person can do the work of 3, and many in the sector have not automated. Our view was the line was a very attractive proposition for the right buyer, we just had to find that buyer. After a short but intense marketing campaign in which we drove interested parties into an online auction – necessarily short because the new plant was arriving within weeks – we found 2 end users who bid against each other in the online auction. A sale was completed to one of them, generating a good amount of money for plant our client thought was not worth much! And all within 6 weeks from the initial call to the cash landing in their bank account!
The moral of this story?
Just because something has been written off in the accounts, doesn’t mean it’s worthless.
Our client had spent a number of years building a very profitable business manufacturing ‘basic pharmaceutical products’. In the early days they bought used machinery across Europe, often in job lot/clearance auctions, integrating what they needed into their production lines, storing what they did not need, in case they should sometime need them for spares or for any further new product lines. The storage facility cost them £25k pa, so just before the lease came up for renewal, management decided to have a clear out. We arranged an online auction, targeting companies in the basic pharmaceutical sector. The outcome was over 85% of the contents were sold (despite the fact the vast majority of what we sold had been given to our client foc), realising tens of thousands of pounds for the client and enabling them to avoid the ongoing storage charges and having to commit to another lease.
The moral of the story?
Just because you paid nothing for an item doesn’t mean (1) continuing to hold it doesn’t cost you; (2) it hasn’t got a value to someone else.