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In-depth equipment purchasing trends from giant survey

In-depth equipment purchasing trends from giant survey

By CE December 10, 2014 View Profile

Purchasing.com has recently released a heavy construction equipment whitepaper that highlights purchasing trends from an in-depth survey taken by 71,000 participants. The participants consisted of CEOs, managers and procurement professionals operating in a wide array of industries utilizing construction equipment. The report, Tech Innovations Drive Increases in Heavy Equipment Leases and Rentals, covers a four-year time period and touches on the following types of construction equipment:

• Backhoe Loaders
• Bulldozers
• Compact Track Loaders
• Excavators
• Rough Terrain Forklifts
• Skid Steer Loaders
• Wheel Loaders

The most notable findings were towards the requests for new equipment, a shift towards the rental of these machines, and what has been driving these significant changes over time.

A shift towards new earthmoving equipment

The survey revealed a 31 percent increase in requests for new equipment from 2011-2012 to 2013-2014. There were three clear reasons specified in the report for the shift in preference to new equipment:

1. Tier IV emission standards

In 2011, new Tier IV emission standards set in and as a result, began to impact smaller pieces of earthmoving equipment purchased up to 75 hp such as skid steer loaders and compact track loaders. Businesses now do not have the option to purchase low-hour equipment that doesn’t fall within those Tier IV emission standards.

2. New technology improving productivity in equipment

Cost-saving technologies in earthmoving equipment are another force driving the trend towards purchasing new equipment. Tools like skid loaders now have the ability to become multifunctional due to quick change attachment couplers; this allows one machine to potentially replace four machines. In addition, new skid steer loader ergonomic controls and redesigned cabs lower operator fatigue while increasing jobsite productivity. Radio remote control systems have also become more prevalent in construction equipment such as skid steer loaders and compact track loaders. When this technology was releases in 2008, only eight models were capable of this. Now, any machine with selectable joystick control or all wheel steer can be controlled in situations remotely.

3. Remote monitoring and reporting options

More and more manufactures are offering remote monitoring and reporting options to improve jobsite efficiency, as well as stay on top of preventative maintenance. John Deer, Volvo, Komatsu and Cat are notable names in the industry working to improve the longevity and productivity of their machines for their customers.

A Shift in equipment financing

While business owners are often preferring new equipment, they’re not always purchasing that equipment outright. One of the most notable financing trends are around a shift in how business owners chose to finance the procurement of a wheel loader. In 2014, 9 percent of Purchasing.com survey participants indicated an intent to rent their wheel loader — a 268 percent increase from 2011. The driving force behind this increase is the cost of service and upkeep, and the additional fees that come with an SLA. These other costs are often covered during a rental, especially if it’s a short rental term.