How Selling and Renting Used Air Compressors can Add to Your Bottom Line

October 20, 2012

The more clients I speak with, the more I realize just how many people are unaware of what a huge market there is for used industrial equipment.

Of those that have a sense they’re sitting on a goldmine with their inventory, most assume getting in the business of renting or selling it is just too much of a hassle.

My goal with every client, and with this article, is to explain that liquidating used equipment is a simple case of knowing some key strategies and having a sound system in place.

Once you realize the value of used equipment and understand there’s a huge market for it, you can easily expand your business and put more money in your pocket.


How Used Equipment Can Add Revenue to Your Bottom Line


A significant amount of money can be made in selling or renting used compressed air systems.

Let’s say you take in a unit that needs repair. You can bill the repairs to yourself, turn around and sell the machine – deducting the amount of time and energy you put into fixing it – and increase its cost basis while reducing the tax burden at the same time.

Some compressed air units can be rented out for as much as $1500 a month. And, whether you sell or rent, you’ll most likely obtain a new service contract bringing in even more revenue and an additional customer who might buy a new system from you down the road.


Your Advantages as a Dealer


As a dealer with licensed and trained technicians, you’re an automatic trusted source.

You have the ability to overhaul a unit, service it and provide all the repair records, test the seals and check the various performance benchmarks before it goes back out the door.

Having service records and all documentation of a system’s history will carry a lot of weight when the time comes to rent or sell it.

Another advantage you have is that you sell new systems and see existing systems in place on a regular basis, so you’re one of the people most likely to come across incredible deals on wholesale used equipment.

These are deals where the customer most likely will not be shopping their equipment around or even be aware that someone would be interested in buying it.

But if you can simply get rid of the unit for them and give them a few bucks – you can then take the equipment on your lot, clean it up, make any necessary repairs, and turn around and sell or rent it for a hefty profit.

Also, many new sales get locked up because a customer already has a piece of equipment that is currently working.

Sure, the system may be on its last legs, but the customer just can’t see getting rid of something that still does the job.

As a dealer who buys and sells used equipment, you can take that deal out of a log jam by taking the unit off of their hands. They can then take that extra money and put it towards a new machine they purchase from you.


Steps for Selling or Renting Your Used Equipment


Now that you’re aware of the value of used industrial equipment and understand there’s a large market for it, you’re ready to start moving your own units.

Here are some guidelines to help you get started:

Take Proper Inventory


The inventory on your lot has to be maintained and managed well, and for this reason, a dedicated staff member should be appointed to the job.

Once or twice a month they’ll need to go out into the yard and record some data about the inventory currently available.

They should make note of the following:


  • The make and model number
  • All serial numbers
  • The year of the machine and / or total hours on it


Also, it’s important to provide photos of the equipment you will be selling or renting, so make sure the person in charge takes clear and well-lit pictures from different angles that show the unit well.

This job should only take a couple of hours once or twice a month.


Listing Your Equipment


The biggest impedance to getting equipment listed is simply making a point of doing it. It’s a great idea to create a schedule and put it on your calendar. Carving out time on the calendar for inventory maintenance and listing can lead to huge revenue gains.


It’s important that you have a system in place for listing the equipment, and there are a few ways you can go about this:


  • If you have the necessary infrastructure in place, you can list your inventory on your own website.
  • If you don’t currently have this infrastructure set up and your budget allows, you might consider hiring a programmer to add a space to your website for these listings. Whatever system they set up for you, make sure it’s easy to use and that the database can be updated frequently.
  • A third option is to work with a listing company, such as, who will list and market your inventory for you.


Whether listing your equipment yourself or working with a listing company, it’s important that the system has tracking capabilities. This will let you know how much traffic or how many views your equipment is getting. This data can help you make necessary adjustments in order to make more sales.

For instance, let’s say a particular piece of equipment has gotten 200 views but no inquiries. This may be an indication that you’ve set your price too high.


How do you know where to set your price?


Unfortunately, there’s no Kelly Bluebook for used equipment, but there are a couple of different ways you can arrive at a fair asking price:

  • Find comparable equipment online at classified sites and determine a fair market price, based on years or hours.
  • Take 60% – 70% of a new unit’s cost if the unit was built in the last 10 years, and 35% – 40% if the unit is between 10 – 20 years old.
    You will also need to factor in condition, hours, service history, etc.

Things to Include in Your Listing


There are a few key things you will want to make sure you include in your listing:


  • Photos. In our experience, very seldom does a used piece of equipment get any inquiries without photos being provided. People want to see the machine being sold or rented.
  • Service history and maintenance records. Just like purchasing a car, people want to see that the unit was well-maintained. It speaks volumes on how long it can last from this point forward. So, when you acquire the equipment, make sure to get all documentation from the initial owner.
  • Price. When a price is not listed on a unit, there simply won’t be as many inquiries. You can say in your copy that you’re flexible, prices are negotiable, no reasonable offers refused, etc…. but it is highly recommended that you include a starting price at least.

Handling the Leads as They Come In


When phone inquiries start to come in regarding your listed equipment, be sure to respond as soon as you can.

Response time is a critical factor in whether a lead gets closed or not. Have a dedicated sales person who will handle these calls and make it clear that they must be answered in a timely fashion.

It’s a good idea to form relationships with a few shipping companies prior to listing so that you have a way of getting inventory to people who are not in your immediate area. Being able to ship inventory to buyers means more sales – period.

And speaking of sales, it’s important to use a company like to handle the financial transaction. Using an escrow service means all parties will be protected during the sale.


Drive More Sales Via the Web


Probably the largest element driving used inventory sales is the internet. If you’re not showing up in major search engines like Google and if your site isn’t optimized, then sales will suffer.

Working with a company like, which can get your inventory in front of targeted leads, is critical.

If your own website doesn’t get a lot of traffic, it doesn’t always make sense to have your equipment listed only on there.

In my experience many companies have tens of thousands, if not hundreds of thousands of dollars of used inventory just sitting out in the yard. And, because this equipment depreciates quickly, there’s a small window of opportunity on gaining revenue.

The failure to treat this used inventory as an opportunity to sell more equipment and expand your business can be quite costly.
The bottom line is – if you ignore your used inventory, you’re leaving a lot of revenue on the table.


Jason Lexell, operator of – helps companies manage hundreds of thousands of dollars in used inventory to get it sold, increase their business and generate more revenue.

Some companies we work with:


Give us a call on 800-237-3027 or use the contact form to reach out to us.