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Used equipment gives life for startup founders

Used but reconditioned processing machines are hot items for startup operations emerging in developing areas around the world, say exhibitors at the recent ReSale 2005 fair in Karlsruhe, Germany.

Many machines were sold directly at the trade fair as early as the first day," says Kurt Radermacher, managing director of the Assn. of German Wholesale Dealers in Machinery and Tools (FDM; Bonn).

Exhibitor Plast Engineering Knauff (Taunustein, Germany) was able to sell a recycling line for PET bottles for €268,000 to a Romanian processor, and a Syrian buyer signed a deal with the company for a reconditioned blown film line for €62,000, says company president Eckardt Knauff.

"Fair visitors knew exactly what they wanted and targeted searches for specific used equipment," says Friedhelm Dörscheln, president of Universal Plast Maschinen (Meinerzhagen, Germany). He was able to sell two renovated Battenfeld injection molding machines into Lithuania. Another unit went for €26,300 to a Russian startup company''s founder who needs to produce plastic bottles for a shampoo recipe developed by his grandmother that he plans to produce and market.

Not all such sales were accompanied by personal stories, but exhibitors told MPW that Eastern European visitors showed substantial interest in buying second-hand equipment. Josef Brändlin, sales manager, modernization/engineering at extrusion equipment maker Coperion Buss (Pratteln, Switzerland), says price plays the key role for customers who are interested in anything from lab to high-torque extruders. Such reconditioned units can cost 30% to 50% less than a new machine.

One drawback to the used market, however, is the availability of the exact equipment in which the customer is interested. "It can take up to seven months to locate and deliver the right reconditioned unit," Brändlin says.

But for experienced processors, buying secondhand compound extruders ensures production security.

"Customers are often running their equipment at near capacity to get full benefit at today''s resin prices. They can''t afford to see their production go down for any reason," he says. Used units can provide backup support.

Reimelt-Henschel Mixing Systems (Kassel, Germany) agrees that production security is a key reason to buy second-hand equipment. During the show the company sold a complete PVC mixing plant, not just individual machinery. But Ralf Twardon, service technician at the company, says that to his amazement, he could have sold six additional plants had they been available.

PVC pipe extrusion equipment-to produce gas, water, sewage, and household pipes in diameters from 20 to 630 mm-is in high demand in Russia, CIS countries, Iran, and Egypt, says André Knorr, managing director of Knorr Extrusionsmaschinen (Nettetal-Leuth, Germany). Most requests are coming from startup companies, which he says are usually formed of ex-employees with processing experience who have left another operation.

Used PVC profile extruders are required in countries such as Russia, Bulgaria, and CIS countries, says Jürgen Kinnart, director of reconditioned equipment distributor PMH (Hennef-Kurscheid, Germany). "It doesn''t matter which brand, as long as it offers Western European quality and the price is right," he says. "That''s what customers are looking for." Kinnart also says thermoforming lines are hot items for food packaging as long as they''re versatile enough to allow the processor to switch from polypropylene to polystyrene, depending on resin price variations.

Etienne Huart, from the sales department of Indext (Mulhouse, France), part of NEXT, a German-French second-hand extruder distribution joint venture, says his company is starting to feel competition from Chinese new-equipment manufacturers selling at used prices. Sarac Plastic Processing Machinery (Istanbul, Turkey) agrees and speculates that the Chinese are undercutting the market with low-priced new equipment to gain market share.

Old mold investment offers new profits

Frédéric Lutz, managing director of FairMoulds.Net (Offenbach, Germany), an Internet platform which helps buyers and sellers find each other, says that he has 900 used molds on his homepage, but he could sell 10,000 if only the owners had complete documentation of the molds and product samples.

"But many molds are in poor shape because they have been improperly stored and sellers haven''t gotten around to providing the documentation needed for each of them. It takes time and they haven''t done it yet," he says. Many processors don''t realize they are sitting on an untapped well that could bring in needed cash for the company.

Lutz, displaying some of the molds the company helps sell at the recent ReSale 2005 show in Karlsruhe, Germany, says currently 80% of all requests for used molds come from Eastern Europe, many from startup operations. "Often these people don''t know much or anything about processing. They are looking for a business to invest in that could turn into a success," Lutz says. "Startup operations are very interesting for our company. They are willing to invest in used molds to test the waters."

One new product his online company is offering this year is the opportunity to rent a mold for processing. "It depends on the [mold] owner and if he is willing to allow a certain run by another processor in a non-competitive region," he says.

Although Lutz says FairMoulds.Net has grown and profited during the one and a half years since its startup, he has seen a number of used mold dealer competitors, which sell molds rather than arrange sales between individuals, go belly up. "Margins are poor today and if you have to stock and warehouse different parts, you have high overhead expenses that we don''t have."

He says dealers are also often stuck with injection molds that don''t move from their shelves because they process products which have thick walls and at today''s resin prices processors are looking to use as little raw material as possible. RC

Robert Colvin [email protected]

Contact information

Coperion Buss   www.coperion.com
FairMoulds.Net   www.fairmoulds.net
Index Second Hand Extrusion Machines   www.indext.fr
Knorr Extrusionsmaschinen   www.knorr-extrusion.de
Plastics Engineering Knauff   www.plastics-equipments.de
PMH mbH   www.pmh-extruder.com
Reimelt Henschel MischSystem GmbH   www.reimelt-henschel.com
Sarac Plastic Processing Machinery   www.sarac.com
Universal Plast Maschinen (UPM)   www.universal-plast.com
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