5 Things to Know Before Buying Machine Tools

You’ve probably heard that manufacturing jobs are on the rise, and it’s never been easier to start your own business. But before you start browsing your favorite search engine for the perfect machine tool, take a moment to read these five things you should know first.

Things to Know Before Buying Machine Tools

1. Appropriate Distributor

It’s common for new machine tool dealers to choose the distributor who offers the highest profit margin, but that’s not always the best option.

Machine tool distributors and manufacturers are like accountants and tax lawyers. Both offer valuable services, but they should be used in different situations. Good machine tool distributors help you choose the best machine for your needs, introduce you to other business owners in your area and help you get financing if needed. They’re also there to make sure you don’t get scammed.

Machine tool manufacturers’ job is to make sure your bought machine works properly and that it’s made with the highest quality parts. Manufacturer’s distributors work with you to ensure a smooth transition from machine buying to machine operation.

2. Vision

Before you start looking at machine tools, take a step back and look at your vision for your new business. Do you need to start with a tiny machine so you can get comfortable taking payments over the phone? Or do you need to have a large market presence in your first year? Do you want the ability to sell your machine and get paid cash up front, or are you willing to wait for the machine payments until later on?

Evaluating the best machine tools for your vision is key to making the right decision.

3. Capacity

You generally buy a machine tool for your business based on how much capacity you need. But don’t overlook buying a machine with a large capacity. You can always rent it out to other business owners in your area.

“Over-capacity” means the manufacturer sells you the machine with more parts than you need. This helps you survive in your first year, so you don’t have to buy more machines yet. It also saves you costs because you won’t be paying as much for machine parts in the first year. If you buy a used machine tool, this may or may not be the case, so make sure you read the warranty terms. And also, talk to other machine tool dealers in your area.

“Under-capacity” means the machine comes with fewer parts than you’d like. While this might help your start-up budget, it might also mean that your machine doesn’t work right until the dust settles. You may have to buy more parts right away. This can be avoided if you buy used machine tools.

4. Flexibility

You might think there are only two ways to buy a machine tool-cash or credit. But there are plenty of other structures. Part of your decision will depend on your bank’s requirements. If you get a loan from the bank, they may require a lump sum to start.

If you can buy the machine with cash upfront, you will likely get better interest rates. But if you pay a cash down-payment, there may be no interest at all.

“Cash in hand” refers to reserving 10% of the purchase price for taxes and delivery charges before making payment. This way, you won’t have to pay taxes and fees on the entire purchase at once. You will be able to write checks as materials are installed on-site.

If you’re buying a used machine tool, your options will be slightly different. Cash, loans, and payments are still great options. But it’s also common to buy machines with a lease-to-own option.

“Flex” means you can make the payments on your machine over a longer period. This is usually done through a bank loan. It doesn’t lower your overall cost, but it can help keep your business healthy during those early months when you don’t yet have consistent machinery payments. It can also help you buy a machine in the beginning if you don’t have enough cash.

5. Personal Needs

“What do I need?” is the most important question and deserves your full attention. Don’t let the salespeople talk you into a machine that’s too large or too small for your business.

Don’t rush the process. There’s no set date when you have to make a decision. Take your time, examine all your options, and make an informed decision.

It’s also important to note that buying a machine tool isn’t like buying a car.


Every business has unique needs and a specific vision. Before looking at specific machines, take some time to understand your personal needs for a machine tool. Choosing the right machine tool distributor will help you through your buying process.

You might be surprised to discover that building a business is more like making a new friend than having an account executive make it all happen for you.

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