Trade Values & Trends Powered by IRON Solutions Gold Standard Data
The last installment of Trade Values & Trends (“Examining Equipment: 2007-2009 Resale Values,” February 2010) examined the resale values of an array of equipment.
In that analysis, a continued strength in resale values of high-clearance, self-propelled sprayers was revealed, as growers increasingly view these machines as vital for preventing crop damage. This article provides a more in-depth analysis of used self-propelled sprayer sales to identify the optimum timing for sales.
Figure 1 examines quarterly sales data for self-propelled sprayers ranging in age from 1-10 years old. When reviewing the manufacturer’s data, it’s important to note that Deere’s used sprayer sales may reflect improved reporting methods compared with other manufacturers.
The study shows growth of more than 65% from 2007-2009, and 2010 appears to be off to a strong start. In reviewing the timing of used sprayer sales, farmers may be looking for tax incentives to offset the previous year’s income during the first quarter of the year. Last year’s late spring also may have pushed demand for sprayer sales later into the second quarter, possibly due to concerns that custom application services would not be able to complete the work on time.
Figure 2 shows that values remained very strong during the reporting period, even as units aged. Resale values that hold steady serve to strengthen the entire resale value chain. That is, for every buyer who prefers to trade up, there’s another one who wants to buy an older unit.
Farm Practices are Changing
From this study, it appears that farmers are likely changing their growing practices. Sprayers are no longer viewed as luxury items, or niche products for custom applicators, but rather as necessary equipment for large farm operators.
Farmers are not only replacing product for product, they’re also moving away from custom application services and pull-type sprayers, opting instead for the additional productivity that comes with high-clearance, self-propelled sprayers.
And when comparing the costs, many farmers can now justify the purchase of a self-propelled sprayer — even a unit in the $150,000 to $200,000 price range.
Demand is Driving Sales Opportunities
While sprayersrepresent a high-end segment that requires an entirely different set of selling skills and techniques, dealers who carry sprayers, both new and used, are in a good position to take advantage of more resale opportunities for high-demand, high-value trades.
And clearly, the demand for used self-propelled sprayers is strong. That’s encouraging news for the dealers who carry this specialized equipment. They can be confident when taking sprayers in trade that there will be a market for these units.
“Self-propelled sprayers have seen growth of more than 65% from 2007-2009, and 2010 appears to be off to a strong start...”
The study was provided by IRON SOLUTIONS, publishers of the Equipment Industry’s Official Guides based on gold standard equipment data. IRON SOLUTIONS gathers data on used machinery transactions from dealers, auctions and other sources. For information on the Official Guide, the gold standard data and other dealer solutions provided by IRON SOLUTIONS, visit www.ironsolutions.com