How to sell surplus industrial MRO Spares

Posted by admin on July 9, 2019  / 
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how to sell surplus mro spare parts

The challenge in selling MRO spare parts is that it is difficult to find a buyer willing to pay a fair value for the list of numerous spare parts that you hold in your inventory. The key to recovering the maximum value is to break the list down into manageable categories and attempt to find buyers who deal with specific categories.

Unfortunately, not only is this a laborious process, but it’s also discouraging to sellers who wish to recover value quickly. The good news is that there are a significant number of buyers in the market who purchase and resell MRO spares as part of their core businesses.

Challenges in Selling Surplus MRO Products

Those who source MRO products do not realize that it is extremely challenging to sell their surplus MRO Products.

The first consideration sellers must understand when selling surplus MRO parts is the difference between book value and liquidation value. Most businesses maintain a log of book value for their spare parts in their financial system. This book value is comprised of what they originally paid for these parts, plus any maintenance and storage costs to keep these parts in inventory.

A huge obstacle for sellers is the actual realization because the liquidation value for surplus industrial spare parts is typically 5-15% of book value. In some instances, it can be as high as 50% of book value, but it depends on the age, market demand for these specific parts amongst other parameters.

This might seem very low a yield! However, understand the large majority of spare parts are machine or operation-specific and therefore cannot be easily resold. Once you understand this reality, these number starts to make sense.

Consider the alternative. Holding onto parts on your shelves will only lead to their continued depreciation and them taking up valuable shop space / warehouse. Lastly, something to remember if you are selling products on a liquidation marketplace is that you are foregoing a higher price/value that can yield for your products, for the speed of sale. But then, if you have an online marketplace for MRO products buying and selling, it could be the right platform that you can just sell just not only your excess spare parts, but also enable you to procure / source these unused parts online, adding value to your entire procurement management process.

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