How to Establish Prices for Forklifts

Prices for forklifts, in the case of new equipment, can easily be established through the distributors of such equipment as can the prices for refurbished units. In the case of second hand equipment establishing any fair and equitable price is not a simple matter and is probably the function of experience in the trade, more than anything else.

There is a sound competition in forklifts in South Africa for new units, so prices are influenced by the local market to be reasonable and the only variation on prices (other than periodic price increases) will be the R/$ relationship, which could influence the price of imports from time to time. Because of a high population of forklifts in South Africa, there equally should be a competitive market in the case of second hand forklifts. The problem however lies in the establishment of a base price to use in the comparison of prices for forklifts in the second hand market. Unlike cars that have records of date of manufacture, a maintenance history, a record of kilometres done and a market driven by supply and demand, the same does not necessarily apply to forklifts and certainly not to manual forklifts. The second hand prices for forklifts, therefore, seem to be a bit problematic and not easily verifiable. The only real indicator of value would be any record of workload, i.e. hours in operation, rather like aircraft, that will provide a reliable guide of its probable condition. Another factor to use would be to determine the written down cost of the machine by depreciating the original value of the truck by the amount allowable by SARS and then to allow some additional value according to market conditions.

Real market experience on the other hand would probably be more accurate in the establishing of prices of forklifts in the second hand market. It would appear to be a little risky when buying a second hand unit from the market, and not through a dealer, unless you really know the market and related values. The real risk, however, of a second hand unit, seems to lie in the condition of a forklift, particularly when it is a mechanised unit.