Auction, consignment, or scrap: how idle machinery actually leaves a plant

There are only 3 ways a working machine leaves a plant for money, and everything else is a variation on one of them. It goes to an auction, it goes on consignment with somebody who sells that kind of equipment, or it goes for scrap. The right answer depends on 4 things: how fast the machine has to be gone, how much certainty you need about the outcome, how much of your own team’s time you are willing to spend, and whether a second user for that machine actually exists.

The auction

A date is set, the lots are advertised, and on the day the room decides. Online, on site, or both. This is the fastest route from a floor full of mixed equipment to an empty building, and it is honest about what it is: a mechanism for converting assets into money on a known date.

The strength is the date. The cost is also the date. Whatever the machine brings on the day is what it brings, and the result depends entirely on who happened to show up. The 2 buyers in the world who need a machine of that exact width may be mid-shutdown that week, or on another continent, or simply not watching that sale.

An auction is the better answer when the site must be empty by a fixed date, when there are hundreds of mixed lots rather than a handful of good machines, or when a court, a lender or a landlord is driving the timetable. We will say so when that is what we see.

Consignment

The machine leaves your floor and goes to somebody who sells that class of equipment for a living. They receive it, photograph it, write it up, list it, market it and handle every buyer. When it sells, you take the agreed share.

The strength is that the machine is sold rather than auctioned. There is no date forcing the price, so the sale can wait for the buyer who actually needs that capacity, that width, that control system. That buyer usually pays more than the room does, because they are not buying an opportunity, they are solving a problem. The second strength is that the work moves off your desk. You are not writing descriptions, answering questions, arranging viewings or chasing a buyer’s rigger.

The trade is that you do not know the date. A machine sells when its buyer appears. Some go in weeks. Some take longer, and the seller who insists on a date is usually the seller who should have gone to auction.

At American Plant & Equipment the machine ships to our warehouse in Roebuck, South Carolina, and every term is agreed in writing before it ships: the commission, when you are paid, storage, the minimum period, who pays inbound freight and rigging, insurance while it is in our care, preparation and cleaning, and what happens if it does not sell.

Scrap

Scrap pays for weight. It is quick, it is certain, and it is final.

The trap is that it feels like the safe option for anything old. It is not. Older, heavy, mechanically sound machines are exactly the equipment that holds value in industries where new machines are expensive and lead times are long. Sellers routinely scrap machines that a user somewhere would have paid real money for, because nobody asked.

Scrap is the better answer when the machine is genuinely obsolete, when it has been stripped for parts beyond repair, or when it was purpose-built for 1 product in 1 plant and no second user exists. Before you scrap anything, spend 10 minutes describing it to somebody who sells that equipment. If the answer is that there is no market, you have lost 10 minutes.

How to choose, in 4 questions

1. Is there an immovable date, and how close is it? If the building has to be empty inside 60 days, you are choosing between an auction and scrap for the bulk of it, and possibly consignment for the few machines worth the freight.
2. Is the value concentrated or spread? A handful of good machines plus a lot of general plant equipment usually means 2 routes, not 1. Consign the good machines, auction or scrap the rest. Most closures end up doing exactly this, and it is the right answer.
3. How much of your team’s time is this worth? Running a sale yourself keeps the whole proceeds and costs more hours than anybody estimates. Consignment costs a commission and almost no hours.
4. Does a second user exist? If yes, scrap is throwing money away. If genuinely no, scrap is the honest answer and nobody should pretend otherwise.

What we do

We take machines on consignment. You ship it to Roebuck, we receive it, inspect it, photograph it, write it up, list it on americanplantandequipment.com among roughly 97,000 machines, and market it to our buyers across 18 industries worldwide. When it sells, you are paid the agreed share.

We will also tell you when consignment is the wrong route for what you have, because sending you to the right answer costs us 1 deal and sending you to the wrong one costs us a reputation. Send us the list and we will tell you which of the 3 routes we think it is, and why.