Aftermarket: New Test Equipment Versus Used

When buying avionics test equipment, there’s more to figure into the equation than price alone. Writer Dale Smith talked to experts in the field who gave some guidelines and food for thought when making the decision to purchase test equipment.

It would seem like a textbook no-brainer — if you can afford to buy new test equipment, you do; if budget is an issue, you buy used. End of story. Turn the page. But wait, not so fast.

"People typically make the new-versus-used decision based on one of two factors," said Peter Ostrow, president and CEO of Technical Communities Inc.

"The first is total cost of ownership. They want to decrease it," he said. "The second is, they require a match in form, fit or function to an existing unit that needs to be replaced."

Ostrow said important details to consider when it comes to total cost of ownership include warranties, calibration, upgrade ability and the like. Another factor — the need to replace an existing unit — is much clearer.

"This is a secondary market because a new model of the test unit is no longer made, or the software or the racking that this piece of equipment is fitting into is complex enough that retrofitting a new unit or upgrading the rack is more expensive than replacing that particular unit," he said.

In those cases, Ostrow said, it’s not about price or any other issue.

"You just need to get that piece of test equipment, and if it’s not made anymore, you have to go with used," he said. "It’s not worth buying a new one and reconfiguring and reprogramming what you already have to accommodate the new piece."

Pat Olson, who sells test equipment for Aero Express, said there is a great deal of good, used test equipment available in the market.

"In a perfect world, brand-new equipment is nice to have, but make no mistake, for those whose budgets dictate there is a plethora of good, used avionics test equipment out in the marketplace that will meet the needs for the shops working on GA, corporate and airliners," she said.

Cost Versus Value

The part of the equation important to many people is the total cost of ownership of a piece of equipment.

"Used test equipment will usually come with a shortened warranty or no warranty at all," said Mark Gardner, director of test equipment sales for EDMO Distributors. "A standard manufacturer’s warranty on new equipment is one to two years, and some extended warranties are available."

If the price is low enough, however, some people still will choose equipment without a warranty, assuming if it breaks they’ve saved enough money to have it fixed.

"Again, in a perfect world, everyone who wants to start an avionics shop may want to purchase brand new, state-of-the-art, top-of-the-line test equipment, and spend top dollar doing so," Olson said. "However, one always needs to consider ROI (return on investment). The ability to recover this investment in a timely manner is not always guaranteed.

"Many large Fortune 500-type companies also consider and do buy quality used test equipment because it makes good economic sense to do so," she said.

Getting Support

Gardner said another factor to consider when purchasing used equipment is the time in service and the support from the manufacturer. According to Gardner, there are many models no longer supported by their manufacturers.

"If a piece of equipment is say eight to 10 years old, it’s probably going to be very difficult to get support for that box," said Victor Bontorno, national sales manager for ground support test equipment for EADS Barfield.

"I tell my customers that if it’s that old, you may not want to buy it. Components are getting very expensive and difficult to purchase."

Bontorno said when a unit comes in for repair, if the price to fix it is nearly the same as the cost of a new piece of equipment, the customer is made aware of their options.

"We give them the option of fixing theirs or giving them a deal on a new unit," he said. "Why spend a couple of thousand fixing an old box when you can get a new one for a thousand more?"

When considering a piece of used equipment, contact the unit’s manufacturer and ask if the unit is supported. The manufacturer also may be able to confirm if the unit already has been in for any upgrades or repair work. Bontorno said EADS Barfield and all the major manufacturers keep track of the serial numbers of all units they sell and service.

If a used unit does have a warranty, examine the warranty carefully to make sure it covers what you think it covers.

"There’s no standard body of wisdom that creates categories for used equipment and warranties," Ostrow said. "There are a lot of variables."

Olson said most distributors offer warranties, anywhere from three months to one year, and will provide equipment that has been serviced and calibrated by a qualified calibration facility.

"You will also be able to buy accessories for the equipment. The dealer will help you match your needs to the right equipment — new or used," she said.

Right Tool for the Right Job

Another element of the new-versus-used equation is to consider what the equipment will be used for.

"You have to look at the technology of the aircraft you are going to be working on — how the technology will work at both ends," Bontorno said.

Gardner said some older equipment does not meet current RVSM testing tolerances.

"Consider the testing requirements of newer aircraft and avionics, such as Mode-S transponders, TCAS and ADS-B," Gardner said. "New equipment will have up-to-date software. An example would be a Mode-S test set that does not have the current capability to test elementary and enhanced surveillance requirements."

The type of work you currently do or the type you want to do is a good foundation for deciding which type of equipment will best fit your needs. If you are trying to actively attract a particular type of work to your shop, you will want to make sure the test equipment you purchase can stand up to the workload.

"The main thing one needs to consider is functionality. Once you determine your need by function, then you can purchase the equipment accordingly," Olson said. "You will want to purchase equipment that will do the task required and is still supported.

"Therefore, a used piece of equipment that comes from a reputable dealer and is still supported may be the best option. New equipment is only new once. Since test equipment is calibrated once a year, the gap between new and used is sometimes very small," she said.

Olson said another thing to consider is, newly developed test equipment with new technology may have "bugs" to be worked out and may not be as reliable as a similar test set that has been in production for a few years.

Is Used for You

Some factors appear tilted in favor of buying new. New test equipment offers longer warranties, better support and often manufacturer upgrades. But there are factors favoring used test equipment as well.

"There are shops and shop owners who will vouch for the fact that their business may not have gotten off the ground if they had not originally purchased used test equipment," Olson said. "Also, as a business begins to grow and make money or the equipment needs to be upgraded, the used gear can be traded in toward new equipment.

"This investment is much more palatable when shops have time, money and experience to bring to the table when they are ready to take the plunge of buying new test equipment," she said.

If, for any number of reasons, buying used is the best solution for you, the experts offer some tips for taking as much risk out of that option as possible.

The best place to start is to know from whom you are buying.

"The biggest consideration is the reputation of the seller," Gardner said. "Will that reseller stand behind that product and provide a warranty for the used equipment? Will a calibration be provided from a reputable facility? Will the required accessories be provided?"

Gardner also said to ask if you would receive the manuals for the equipment.

"That can be a big issue with older equipment," he said. "I’ve tried to accumulate some of the more common user manuals, so if someone calls and I have it, I can make a copy. But a lot of it is hard to find."

In addition, you should make sure the reseller has the technical expertise or knowledge to answer any questions you have about the piece of equipment.

Too Hot to Handle

Another point the experts stress is getting the unit’s serial number upfront, then calling the original manufacturer to see if the unit has been reported stolen.

"That’s a big one," Bontorno said. "Whether it was stolen from another shop or was ‘lost’ by a shipper, you need to be able to at least try and check that out before you buy it.

"If we get a piece in here that’s been reported stolen, we won’t send it back to the shop who sent it in. We also keep track of units reported stolen by shops."

Ostrow said buying from unknown sellers through the Internet also can be problematic.

"A lot of this equipment holds it value for a long time, so the residual value is very high," he said. "If anyone refuses to give you the serial number upfront, then that’s someone to avoid."

The majority of established resellers, however, are honorable and easy to deal with, whether they are a dealer, broker or OEM. Yes, some OEMs offer pre-owned equipment for sale.

"There are many times when I’ve taken in used equipment in trade on new pieces," Bontorno said. "I’d suggest a shop call the manufacturer to see if they have any trade-ins. They not only often have high-quality pre-owned units on the shelves, they often know about shops that are closing or are going to upgrade their equipment."

Bontorno said there are good deals to be found going this route.

"As shops go out of business or folks place their focus elsewhere, good, used boxes are becoming more visible in the test equipment arena," Olson said.

Do Your Homework

As much as we’d like to believe our industry is above such trickery, there are stories about people who have been a little too trusting and ended up purchasing what amounts to "rocks-in-a-box."

"It’s a real buyer beware situation, especially if you are buying off the Internet," Gardner said. "You really have to invest time and effort to make sure you are getting what you think you are getting. That’s why I think it’s a good idea to always deal with reputable sources."

Ostrow said buying "pre-owned" presents many variables.

"There’s no ‘Blue Book’ value, no standards of quality," he said. "No two refurbished units are the same if they are offered by two different resellers."

Ostrow said the lowest price doesn’t necessarily mean the lowest cost of ownership.

"The key to purchasing equipment that will best serve the shop owner is to purchase from a reputable distributor," Olson said.

Reprinted with permission from Avionics News Magazine.

Tips for Buying Used Test Equipment

Here are some questions to ask any reseller before buying a piece of used test equipment:

• What is the exact model and serial number on the unit? (Then call the manufacturer to see if it is still supported.)

• What is the date of manufacture?

• What is the date of the last calibration?

• Who preformed the last calibration? (You may want to contact them to see if they have any records of that unit.)

• Does it come with the manuals?

• Does it have the required accessories?

• Are there pictures of the unit?

• What are the terms of the warranty?

• What is the resellers right-of-return policy?

• Is the reseller a broker or a dealer?

• Can I get references from other customers?

• Does the reseller have its own repair shop or cal lab?