One of the most important tasks for the equipment manager is the analysis and calculation of equipment residual values. There are no magic formulas or short cuts and there are many variables that can affect the ultimate forecast on any high tech asset. Discounting practices, transferability of the software, bundling of the maintenance into the cost of the equipment, and the inclusion of any financing of soft costs in the lease payments may determine if the leasing company made a good investment or bad investment. The researcher analyzes the marketplace for each asset we review based on the conditions above. These reports are used as the backbone in the forecasting module for our reports. In addition to these values we then factor in any new enhancements since the asset was introduced, upgrades that are available, annual hours of usage, new model announcements, new chip technologies and many other factors to finalize the forecasts.
“Residual Value Forecast” (RVF) is defined as the estimated amount, expressed in terms of money, that may reasonably be expected for a property in an exchange between a willing buyer and a willing seller, with equity to both, neither under any compulsion to buy or sell, and both fully aware of all relevant facts as of the specific date. Additionally, implicit in this definition are the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
1. payment is made in terms of cash in United States dollars or financial arrangements comparable thereto, and;
2. the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.
Equipment categories valued in the Residual Value Forecast Report:
- Portfolio Managers
- IT - Desktop, Laptop, Network, Printer, Servers, Storage (disk & tape)
- Construction equipment - Excavators, dozers, cranes, pre-cast concrete forms (K-Rail, box culverts, tank, rattle grates, deck)
- Material handling - Forklift, scissors lifts, cranes, robotic delivery systems, pallet trucks, log loaders, steer loaders
- Machine tools - Numerical control lathes, grinders, milling machines and drills presses,
- Medical equipment - Laboratory, MRI, CT Scanners, ultrasounds, X-Ray, nurses stations, pharmacy systems, exam tables, scopes, mass spectrometers, furniture
- Miscellaneous - Uninterruptable Power Systems, trailer offices and classrooms, sweepers/scrubbers, 3D printers, large inkjet printer system, point of sale (POS) systems, mail systems
- Test equipment - Power analyzers, component, oscilloscopes, electrical, analog generators