Key Takeaways for Decision Makers
CONTRACTOR: Be wary when purchasing a piece of equipment without a verified serial number as the risk of overpaying is high.
At EquipmentWatch, we track both pre- and post-purchase sales activity in order to achieve the most comprehensive picture of the heavy equipment market. In this analysis, we focused exclusively on pre-purchase data in order to investigate a specific question: How frequently are serial numbers omitted from used equipment listings? To this end we looked at 4.7 million assets for sale on the retail heavy equipment marketplace to find out how often a listing fails to provide serial number information to the potential buyer.
Crawler Mounted Hydraulic Excavators, one of the most popular subtypes with over a million sales records, top the chart with the highest percentage of missing serial numbers at a whopping 42.29%. On average, 34.39% of equipment within the subtypes studied do not have serial numbers on their sales data point. This means more than one-third of all equipment from the most popular subtypes on the resale market do not provide an independent method for the buyer to verify model year. When buying a used car, no one would want to buy a car without checking the Vehicle Identification Number (VIN). Serial Numbers are like VINs for equipment, but buyers and sellers often overlook the importance of serial numbers.
Missing serial numbers can be a problem for both buyers and sellers. Without the ability to verify model year that serial numbers afford, buyers are taking a risk of overpaying for equipment that may be older than the year listed. For instance, if a buyer decides to buy a 2012 Deere 8835R wheel tractor which it is actually a 2011 model, he will not only overpay $13,768 but also get a piece of equipment different from the one intended.
Conversely, sellers may be taking a risk of selling their equipment for less than it is actually worth if they do not include the serial numbers. For instance, if a seller decides to sell that same 2012 Deere 8835R as a 2011 due to his uncertainty of the model year, he could potentially lose $13,768.
If there is no serial number for used equipment, buyers need to rely on the model years that sellers provide. Also sellers have to guess the model year if they forgot or were never provided the information. Therefore, market participants should make sure that they see a serial number before making a purchase or sale and verify model year using a service like EquipmentWatch’s Serial Number Guide.