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Used Office FurnitureIn these recessionary times it is natural that many businesses are looking to reduce costs and this has resulted in a huge growth in interest in used office furniture, also commonly known as second hand office furniture or in dealer-speak, preowned office furniture. If you are looking to buy or sell used office furniture it is useful to understand the dynamics of the used office furniture marketplace because this will determine if it likely to be a viable option for your business. A high proportion of the costs of office furniture, either new or used, is made up of the transportation and labour costs to deliver and install the furniture to an end users office. End users may be suprised to discover that it is quite common for office furniture dealers in the United Kingdom who are selling new office furniture to incur up to a third of their overall costs of supplying office furniture in Delivery and Installation charges alone. Office Furniture end users are generally unaware of this fact because there is resistance in the marketplace against paying such high delivery and installation charges. Many dealers charge relatively modest charges for delivery and installation whilst including or hiding a large proportion of the true costs of the delivery/installation service within the selling price of the goods themselves. These costs have a huge impact on the resale vale and availability of 2nd hand office furniture. Case Study - Small Business Selling Used Office FurnitureA new end user business moves into a small unfurnished office on a one year lease and needs to aquire some office furniture for two employees. The business decides to purchase some new good quality no frills commercial quality office furniture from an internet or catalogue based office furniture dealer consisting of a couple of desks and pedestals, a couple of wooden filing cabinets and a couple of storage cupboards for say £1250. The dealer's net costs in supplying the furniture is £1000 yielding a £250 or 20% net profit to the dealer. At the end of the year, the growing business then decides to move into new premises and needs to vacate their old office. The business owner decides that he wishes to purchase new furniture to better suit the layout and staffing requirements of his new office but is then faced with the prospect of disposing of his old office furniture. He decides to contact local office furniture dealers to see if they are interested in buying his office furniture and is suprised to find that there is no interest from any of the local dealers even in removing his furniture for free. He then contacts some of the national used office furniture specialists and finds that they are not interested in aquiring such small quantities of office furniture. After extensive research the business owner eventually finds one dealer who offers a removal and recycling service offering to remove and dispose of his furniture for a charge of £175. He also finds a couple of local dealers who are prepared to "trade in" his furniture, however, the price of the new furniture offered by these dealers, less the trade in value is actually greater than the cost of buying new furniture without a trade in from his existing internet/catalogue office furniture dealer. Being reluctant to actually pay out money to dispose of his furniture he considers all of his other options such as giving the furniture away to charity, to staff or to neighbouring business or selling on an auction web site (such as ebay) or redeploying his furniture either at home or in his new offices. So why is it that office furniture dealers are so unwilling to pay money out on buying back perfectly resalable used office furniture in good condition? To understand this we need to understand a dealers costs. When examining the dealer's costs more closely, his £1000 costs in supplying and installing office furniture are actually split between the cost of buying the brand new furniture directly from an office furniture manufacturer and the costs of delivering and installing the goods to the end users premises which could be anywhere in mainland UK. These costs are typically split down to an average of say £650 as the net cost of buying the the goods and as much as £350 as the cost of nationwide delivery and installation. The transportation costs might be lower for a dealer who operates only on a localised basis, however this type of dealer generally has higher operating costs than a catalogue/internet based office furniture dealers in the form of a showroom and/or local warehouse plus a permanent local labour force to staff the showroom and deliver the furniture so a local dealer's overall costs are likely to be at the same level as a supplier with national coverage. When the dealer is approached to remove the end user's office furniture, even if he is offered the furniture for free he still needs to visit the customers premises to check the furniture is in a good resalable condition, plus he has the labour and transporation costs to collect and remove the furniture from the users premises, the the furniture then has to be kept in storage until it is resold and the furniture has to be individually listed and marketed. Overall these costs can be close to or even greater than the costs of buying new office furniture from a manufacturer and the resale value of used goods will be lower than new office furniture. In view of these facts it is not suprising that it is quite difficult for small businesses to sell their used office furniture when it is no longer required. Often the only realistic selling option for a small business is to list the goods on ebay or a similar web site, however this is fraught with difficulties in timing the disposal of the goods to coincide with the office being vacated. Case Study - Large Business Selling Used Office FurnitureA large business is relocating or closing down and is looking to dispose of a large quantity of good quality office furniture to vacate it's corporate offices. After extensive research the company finds that no local dealers are interested but there is a small number of specialist used office furniture dealers that operate in their region of the UK. A visit is arranged from a couple of these dealers to appraise their furniture. One of the dealers offers to clear the office of furniture for free and is prepared to operate within tight timescales when the business location closes down. The business accepts the offer in order to avoid having to pay for office clearance service. The specialist used office furniture company turns up on time with a substantial labour force. The furniture is disassembled and removed by the specialist used office furniture dealer and the office is vacated efficiently. The specialist used office furniture dealer catalogues and stores the resaleable furniture in their warehouse and arranges for recycling and disposal of the low value/unsaleable or slow moving/low demand items. Supply and Demand for Used Office FurnitureThe office refurbishment industry has without doubt been hard hit by the poor business outlook. Many office furniture upgrade projects have been suspended or cancelled whilst firms try to ride out the financial turbulance until the situation changes. One repeating trend is that many firms are trimming back on staff and opting to relocate into less sizeable and cheaper premises if their lease permits. Without doubt this is positive news for office furniture companies and the office furniture industry. If a business moves into a new office it is frequently cheaper to scrap their existing furniture and replace with a decent quality budget range of commercial office furniture for example Maestro office furniture. A reasonable quality budget office desk can cost as little as £150 fully installed. The cost of dismantling and packing old furniture, moving it to the new premises and reassembling it can frequently be higher than this price so it can be a good idea to think about purchasing new. Office furniture firms have reported a big rise in enquiries about second hand office furniture in 2009, both for firms wanting to dispose of their furniture and firms and individuals looking to buy business furniture. A lot of office staff are made unemployed every week either as a result of their employer closing down or by their employer's cost reduction programmes as they themselves try to weather the recession. The job cuts have resulted in numerous of demands from businesses, commercial property agents and official receivers wanting to clear their property and get rid of the old business furniture. The economic downturn and resulting job losses have pushed a lot of enterprising people to open a new business as for plenty of people self-employment may be the only other option to unemployment. Without doubt these newly formed businesses are endeavouring to keep their initial costs low and therefore many investigate the possiblity of aquiring used office furniture rather than new. Even though there is plenty of pre-owned office furniture available there are significant labour and transport costs involved in carefully disassembling, taking away and storing the furniture not forgeting the onward delivery and re-assembly expenses. Even though savings can undoubtedly be made, the economies made are not as high as some would imagine. Brand new office desks and drawers can often be bought at approximately the same price or for only slightly more than used furniture. Top end office furniture items such as hand crafted walnut veneer boardroom tables and reception desking which usually cost thousands when new are a different case and big savings are often made on these items. The difficulty is in finding the correct walnut desk, boardroom table or reception desking to suit your office's needs. | ||
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