WHEN TO SELL EQUIPMENT.
Most construction equipment gets kept too long. Falling utilization, rising maintenance cost, rising repair frequency, and advancing age all point toward a disposition decision that contractors put off, because selling equipment feels like shrinking. The framework replaces the feeling with two numbers: annual true ownership cost against annual internal revenue at the utilization you're getting today.
True cost is the part owners skip. It's the loan payment, or the capital cost equivalent when the machine is paid off, plus depreciation, plus insurance, plus average annual maintenance, plus what repairs realistically run. Against that sits utilization hours times your internal rate, which is what the machine earned off jobs. When cost beats revenue at today's utilization, the machine loses money every month it sits in the yard, and the loss grows as maintenance climbs. Most contractors never run this until a repair bill forces the question for them.
WHAT IT MEANS.
The sell-or-keep decision is a comparison of a machine's annual true ownership cost against the internal revenue it generates at its current utilization.
Utilization drifts and nobody announces it. The project mix moves, a scope you used to chase dries up, one GC stops calling, and a machine bought for a schedule that no longer exists keeps sitting in the yard earning a fraction of what it used to. The purchase wasn't wrong. The conditions it was built around moved, and the fleet hasn't caught up yet.
WHY THE MACHINE NEVER GETS SOLD.
You're keeping equipment that costs more than it earns
Every machine carries a true cost: the loan payment, depreciation, insurance, maintenance, and the opportunity cost of capital tied up in it. When that true cost per available hour is higher than what the machine generates in internal rental income off jobs, the machine loses money every month. Most contractors don't run this calculation until a repair bill forces the decision for them.
Utilization has dropped but the equipment stays
A machine running at 70 percent utilization when you bought it may be running at 30 percent now, because the project mix, the volume, or the scope moved underneath it. At 30 percent utilization the true cost per productive hour rises hard against the 70 percent case. The machine made sense at 70 and it may not make sense at 30, and none of that's a judgment on the original purchase.
Repair cost is approaching replacement value
When annual repair cost gets close to 20 to 30 percent of the machine's current market value, the ownership economics fall apart quickly. You're spending real money maintaining an asset worth less every year. Sell-and-replace or sell-and-rent usually beats continued repair investment at that point, and every quarter you wait shrinks the sale proceeds.
WHAT IT LOOKS LIKE IN DOLLARS.
Those are the three utilization bands the decision runs on. Above 65 percent, keep the machine, because it earns its cost and gives you flexibility on schedule. Between 40 and 65 percent, run the analysis, since the answer depends on the true cost comparison and on whether utilization is trending up or down. Below 40 percent, take selling seriously, because renting equivalent equipment per use is likely cheaper than owning at that rate.
TWO NUMBERS, ONE DECISION.
Annual true ownership cost is the loan payment, or the capital cost equivalent if the machine is paid off, plus depreciation, plus insurance, plus average annual maintenance, plus estimated repair frequency. Annual internal revenue is utilization hours times your internal rate. If annual true cost is higher than annual internal revenue at current utilization, the machine loses money. When the distance between the two is widening, because maintenance is climbing while utilization falls, the decision gets more urgent every quarter you leave it.
Above 65 percent utilization, typically keep it, since the asset earns its cost and buys you flexibility on schedule. Between 40 and 65 percent, run the analysis, because the sell-or-rent answer depends on the true cost comparison and on the direction utilization is heading. Below 40 percent, evaluate selling seriously, since renting equivalent equipment per use is likely cheaper than owning at that rate, and the sale proceeds can be redeployed into working capital or a replacement reserve.
SPM produces an annual equipment fleet analysis for clients running real fleets: utilization by asset, true cost by asset, and disposition recommendations for anything underutilized or costing more than it earns. The analysis is built from ControlQore job costing data where equipment hours are already tracked, so the utilization figures come off the jobs rather than out of memory. That's the difference between a fleet decision and a fleet opinion.
FLAT MONTHLY FEE. NO SURPRISES.
Three tiers, priced by your trailing twelve month revenue. Which one you're in depends on how much of the work you want off your desk. No hourly billing, no payroll, and no add-ons.
| Last 12 months revenue | Monthly fee |
|---|---|
| Up to $1M | $1,900 to $2,900 |
| $1M to $3.5M | $2,600 to $3,900 |
| $3.5M to $6.5M | $3,800 to $5,700 |
| $6.5M to $9.5M | $5,100 to $7,100 |
| $9.5M to $12.5M | $6,100 to $8,500 |
| $12.5M to $15.5M | $7,400 to $11,000 |
| $15.5M to $18.5M | $9,400 to $13,500 |
| $18.5M+ | Quoted individually |
Range reflects the three tiers below. Which one you're in depends on how much of the work you want off your desk. No payroll. No hidden line items.
You stop guessing.
You get the CFO work. Job costing built against the way you estimate, a 13 week cash forecast, monthly WIP, and a meeting every month that ends in decisions rather than a report.
Your bookkeeper keeps doing the books.
You stop touching the books.
Everything in Core, and we run the bookkeeping and the controllership as well. Nobody in your office is answering coding questions or chasing a reconciliation at month end.
We do the books. No payroll.
Every job shows its margin while it's still running.
Everything in Executive, plus the job costing and WIP platform set up, loaded with your cost codes, and managed for you every month. You never have to learn it.
We do the job costing.
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