BLINDED by the PRICE: Beware These True Tales of Bargain Shopping Gone Awry
In order to facilitate successful acquisition, food manufacturers must make strategic considerations before purchasing used equipment
Larry Stoma, Design Engineer, The Witte Co.
When scouring the Internet for bargains, it’s always hard to be sure when you’ve found a legitimate one. It’s easy to compare prices and specifications for second hand iPods, cameras and laptops, but when it comes to second hand food process equipment, the amount of information typically available to evaluate the machinery would often confound even the most seasoned process engineer. No user manual, no warranty, no maintenance records, no chain of custody documenting prior owners, in fact, there often isn’t much useful information at all — but there’s always a low price.
This was the case when a major cheese processor called asking for help with the used fluid bed dryer the company had just purchased. Needing to quickly expand capacity, the company had jumped at the opportunity to buy a used dryer. But lacking engineering experience, their team didn’t realize that while the process required an increase in capacity to 6,000 pounds per hour, the dryer purchased online had been designed to operate at 3,500 pounds per hour. On top of that its footprint was too big to fit into the processing line. Yet even those problems were secondary since it turned out upon delivery that it was far too large to fit through the door and had to be stored outside for months. Furthermore, what was thought to be a fluid bed dryer failed to include a heating air supply or exhaust system, two of the essential and more costly components needed to operate the dryer. At least the price was right, or so they thought.
While checking machinery dimensions and measuring doorways seems obvious enough, the most important issues this company failed to consider were whether the equipment would meet the requirements of the process. Exactly how much capacity was needed to meet the expanded production needs, what was the capacity of the dryer on sale and had a knowledgeable engineer been brought into the purchase decision? In a single click, this equipment might have been quickly abandoned with a more informed decision making process. Or more of the right questions might have been asked of the seller and more of the red flags that appear bright and clear in hindsight might have been revealed before money changed hands. After leaving the second hand bargain outside and accepting it as a loss, the company began investigating buying a new system directly from a manufacturer with experience in their process.
Many times, the seller offers less knowledge than the buyer brings. For example, a processor suffering through bankruptcy hired a liquidation company to sell whatever it could at whatever price it could get. When the fluid bed dryer would not fit out the door they simply cut it in half. The used equipment dealer managing the sale posted the two halves as a complete dryer and many people considered buying them simply because they had no idea what a complete dryer was supposed to look like.
Similarly, another food processor dismantled its entire processing line and offered each piece of equipment for sale online individually, banking that the breakup value would exceed that of the entire system and attract more potential buyers. But while the process equipment was fully functional as a whole, each piece had been designed to perform optimally as part of an integrated system. Once the pieces had been parted out, the system was no longer viable as a functioning drying system and considerable investments in time and money would be required to put it into operation. Unfortunately, we’re finding cases like these have become the norm rather than the exception. It’s easy for buyers to feel misled or to claim the sellers were deceptive in their marketing practices, but it’s more likely that the sellers provided as much information about the equipment as they had readily available. It simply isn’t possible for used equipment dealers offering scores of different types of process equipment at any time to be knowledgeable experts in every piece of equipment on their list.
If the picture of how used equipment is often bought and sold seems grim, consider these buyers weren’t even weighing whether the equipment had been modified in the field or how many different times it had been “chopped.” But that’s just what happened when a manager for a functional ingredient company bought a drying system secondhand (or third?). He’d felt confident in the purchase after seeing the Witte nameplate in the photos. Upon taking delivery and beginning the installation, the buyer realized the fluid bed dryer arrived without the air supply unit and conveying pans despite their inclusion on the OEM documentation. Although the OEM version would have fit the process, it turned out the system had been modified several times over several decades by several different owners to keep pace with changing product and process requirements. These modifications were not recorded in any manuals, nor was the manufacturer consulted or notified that these changes were made in the field. In this case, from all available information, there simply would be no way for anyone to conclude the system had been chopped without contacting the manufacturer.
At The Witte Company, we maintain an archive of original specifications for every system we manufacture and frequently provide the history, original duty and parts list for people considering buying used Witte equipment. We also offer as optional services to print drawings and manuals and personally inspect the used equipment on-site before purchase.
No matter how low the price, even a quality nameplate cannot substitute for knowledge, information and experience.
Larry Stoma can be reached at (908) 689-6500 or LarryStoma@witte.com.