Equipment refurbishment is necessary for your business efficiency and for the safety of your workforce. While mechanical wear and tear may slow down your equipment, Australia’s safety practices demand safe environments for your employees working with or near heavy machinery.
These combined means scrupulous maintenance schedules, equipment upgrades, and investments in refurbishment every few years. However, it also means the availability of sufficient funds at the right time to finance refurbishments or overhauls. While the market size of heavy machinery repair in Australia was estimated to be $15.9bn in 2022, the access to such overhaul funding is limited for most businesses.
Ready to unlock the secrets of refurbishment financing? Dive into our whitepaper for exclusive insights into this space.
What is equipment refurbishment?
Equipment refurbishment is the process of restoring and rebuilding heavy machinery to maintain assets and keep them operating under Australian guidelines. It could refer to upgrading the current stock of equipment owned by a business or overhauling secondhand machinery to meet quality guidelines.
Refurbishing equipment can include everything from paint work to engine and body part upgrades, to completely stripping the machinery down to its chassis and rebuilding it out afresh. Such efforts need substantial investments, which make asset rebuild and restoration financing a key solution for many businesses in railways, mining, and construction.
Why is equipment refurbishment important?
- Overhauling is less expensive: One of the most compelling reasons why businesses want to renovate and rebuild assets is cost-effectiveness and cash flow advantages. A mining business, for example, can get used equipment and overhaul it for up to 70% of the cost of new underground assets, and up to 50% of the original cost for surface assets. Compared to purchasing new assets, renovating the current stock, or purchasing secondhand equipment and refurbishing it is always more agreeable to the bottom line.
- Supply chain issues: Anyone responsible for sourcing equipment, especially heavy machinery, is aware of supply chain issues that can get in the way of smooth business operations. Due to supply chain bottlenecks, the arrival of new equipment can take up to 18-24 months.
- Geographic challenges: The supply chain bottlenecks often complicate further due to Australia’s geographic location. If the equipment is sourced from overseas, shipping may lead to additional time lags, delaying the process further.
- Workforce safety: As mentioned earlier, adhering to workforce safety norms is crucial. Machinery safety standards in Australia—AS4024.1—benchmarks safety guidelines, which even though not mandatory, represent an excellent defense for businesses in case of an action relating to neglect of duty of care. Timely overhauling and servicing of equipment is therefore critical to maintaining the equipment standards and providing workplace safety to employees.
- Extended machine life: Equipment refurbishing is a fantastic way to support the circular economy, which encompasses the practices of reusing machinery with maintenance and care. Extending their life prevents the bulk of such equipment from landing up in junkyards and landfills, contributing to a sustainable ecosystem.
- Circularity and sustainability: A lot of assets in use today are not solar or clean energy operated and an overhaul can make it more energy efficient and sustainable with new upgrades. Although it does not compare to the environmental benefits of electric machinery, it still means less emissions and can prove to be better for the environment. The reuse of equipment supports a more circular economy.
Discover how we’re powering success stories across Australia by empowering businesses with equipment financing and comprehensive overhaul solutions. Immerse yourself in the inspiring story of our journey with Martinus
The DLL advantage
Most Australian financing providers have limited solutions for equipment refurbishment financing. While they may extend a working capital line for such projects, most are unable to offer a tailored financing solution.
Therefore, businesses choose DLL because we can fund improvements and maintenance work on assets that we have financed. This creates a reliable financing relationship that can also extend beyond the assets we finance and future renovations to funding used equipment that customers may want to source from the market.
It is a real value add to DLL customers because we can fund improvements and maintenance work on assets that we have financed. This advantage often makes us a more convenient financing partner for new customers.
To make the process even more beneficial to customers, we offer compelling financing lines against assets or the total cost of an overhaul—sometimes even at 100%.
Some of the other DLL advantages include:
- A good understanding of assets and overhaul requirements.
- A dedicated and responsive staff serving each client.
- Our industry expertise spans 50 years.
- We are a wholly owned subsidiary of Rabobank.
Hear it from our customer—Martinus
We recently worked with our customer Martinus—a leading Australian rail infrastructure company—funding a complete overhaul of a specialised plant. Here is what Tim Cocks, General Manager of Finance at Martinus shared about the experience of working with DLL.
