Exporting Used Equipment Today, Price Isn't the Battleground

August 16th, the office. Two groups of visitors in the morning — one from Ghana, one from Indonesia. The Ghanaian guests barely sat down before handing me a phone: a competitor's quote on the screen, the same excavator model, USD 8,000 cheaper than ours.

Two years ago a scene like that would have rattled me. Not anymore. I poured him tea and said: "He dares to quote that price. Ask him if he dares to write the inspection report into the contract."

Exporting used equipment in 2024, prices are transparent to the bone. Here's how we stay alive.

Transparent to This Degree

Take a 2018 Komatsu PC200. Purchase price, refurbishment cost, freight — the customer runs the numbers finer than you do. Mohammed told me the equipment market in Dar has a quote wall: prices from China, landed, updated weekly.

A USD 8,000 gap has only three sources: condition one grade lower, refurbishment steps cut, or no after-sales budget. The first two cheat the customer. The third cheats yourself.

Cutting refurbishment steps is the most common. Spray paint over rust without blasting, slap filler on top, and three months later the paint bubbles. Our refurbishment process has eleven steps — derusting, grinding, primer, topcoat — none skippable. Skip one step, save RMB 300; ship one problem machine, lose RMB 30,000.

The Indonesian group put it even more bluntly that afternoon. In Jakarta they'd seen three cheap Chinese excavators; two needed full hydraulic system rebuilds within six months. Eight thousand saved, twelve thousand spent on repairs.

We've tried matching prices too. Once in March: twenty-six road rollers, margin squeezed to RMB 2,300 a unit. The moment the cargo shipped I regretted it — one after-sales case and that margin is gone. It was the only price-matching deal this year, and there hasn't been another.

Sure enough, that deal produced an after-sales case: a roller vibratory bearing went noisy after arrival, and air-freighting the part cost RMB 4,100. The deal earned nothing. Since then the company has a rule: deals under 8% gross margin need my signature. I basically never sign.

Buyers Now Want Three Things

Of the customers we've hosted this year, nine out of ten ask for the inspection report before talking price. In the three pandemic years customers couldn't travel and had to trust reports. The habit stayed.

The report has to be detailed: engine RPM, hydraulic pressures, photos of structural welds, whether the hours were tampered with. Ours now run one file per machine, forty-odd pages, with video of key points — customers scan a code to watch.

Second is after-sales. The Kenyan customers ask it straightest: "When it breaks, who do I call?" We've signed partner repair shops in Nairobi, Dar es Salaam, and Lagos, and opened a parts warehouse in April stocking 210 fast-moving parts.

The parts warehouse costs RMB 22,000 a month to run, with RMB 600,000 of stock on the shelf. That investment won't pay back soon, but without it, after-sales is empty talk. Customers don't believe promises; they believe what they can see.

Third is a parts list shipped with the machine: a set of filters, a set of belts, two sets of bucket teeth. Cost per machine: USD 400. Written into the contract.

We Pay for Third-Party Reports Ourselves

Since April, on expensive machines we bring in a third party. SGS runs construction machinery inspections in Guangzhou: RMB 3,800 per machine.

People laugh at me — paying someone to find fault with your own stock. I say finding faults is exactly the good outcome. In the first half of the year, thirty-one machines went through third-party checks and four failed: one with a rolled-back hour meter, three with hidden structural damage. Those four never left the country; I ate the purchase cost, which still beats losing face overseas.

The purchase cost of those four machines totaled RMB 410,000. That stings — but it's cheaper than one overseas return: round-trip freight plus port detention starts at RMB 60,000.

Can't Move on Price? Add Value Instead

Back to the Ghanaian customer from the beginning. Two hours of talking, and I didn't move one dollar on price.

I added three things: the inspection report with video, the shipped spare parts list, and our Nairobi repair shop's contact written into the contract appendix. He signed on the spot — two excavators.

After signing he told me the truth: he'd been to the other seller's lot for that USD 8,000-cheaper quote. Not a single inspection tag on the machines, and when he asked for service records, there were none. He said machines hauled to a mine are there to work, not to be worshipped.

The price knife, cut to the bone, has no meat left. Nine years into exporting, what I rely on isn't being cheap — it's that customers dare hand you their next order.