How to Buy Refurbished Equipment

November 25, 2014

How to Buy Refurbished Equipment

Refurbished options allow fitness facilities to have great equipment at much-reduced prices.

By Guy Brown

Refurbished equipment presents an opportunity for facility owners on a tight budget to equip their fitness center with recent models of leading brands in as-new condition. However, without due diligence, purchasing refurbished equipment can leave owners with a facility full of faulty machines that create an endless stream of maintenance problems and member complaints.

Following is a buying guide to ensure that you get the most out of your equipment investment.

What’s in a name?

Refurbished equipment is gaining in popularity, and even the largest equipment manufacturers are getting in on the act. “…The popularity of remanufactured equipment has grown,” says Roy Greenberg, vice president of Global Fitness Inc., Los Angeles, Calif.

There is some variation in the terminology used to describe refurbished equipment. Some suppliers refer to “refurbished,” others to “remanufactured” and others “reconditioned.” FitnessPlus.com INC., Bethpage, N.Y., sells “reconditioned” equipment. Gary Graf, director of operations, says that for FitnessPlus.com INC., “reconditioned” demands that parts worn 20 to 30 percent are replaced.

Global Fitness sells “remanufactured” equipment. Explains Greenberg, “Machines are stripped down to the bare frame and built up from there.”

Russ Hensely, sales manager of Kacor Inc., Oceanside, Calif., says, “Each company has its own term, whether refurbished or remanufactured.” Kacor sells either remanufactured equipmentor “as-is” via the Internet.

More for your money

FitnessPlus.com INC. Graf previously worked outside the fitness industry in production and manufacturing. He says that, if he were to start a gym business, he would buy almost all refurbished equipment, with the exception of a mixture of new and refurbished for cardio. The savings on equipment can be tremendous — perhaps $1,500 for a refurbished treadmill compared to $3,000 for a new one. “Buying remanufactured equipment is a great way to upgrade your facility on a low budget,” says Hensely.

“From a price standpoint, customers can expect anything from 30 to 70 percent off manufacturers’ list prices,” says Greenberg. The newest equipment will be slightly more expensive.

Refurbishment cycle

Often, when equipment manufacturers sell new equipment to a facility, the older equipment is traded in. Manufacturers can then sell these trade-ins to refurbishers.There is no practice of fitness centers sending in equipment for refurbishing and return. The price of refurbished equipment takes into account the cost to turn around that equipment, including company overheads.

Kacor sells some equipment as is. “If the machine is in good to excellent condition, then we sell it as used; if it is in poor to fair condition, we remanufacture it,” says Hensely. The age of equipment sold can vary, from as little one year to several years. Graf says most equipment sold is two to five years old, but some 10-year-old pieces have been sold.

Strength equipment

With strength equipment, refurbishment involves breaking the piece down to the frame, sanding it down to the metal, and then applying sealants and coats, says Graf. Worn parts are replaced, with a rule of thumb being anything showing 20 to 30 percent wear. The weight stack painted, and stickers and grips are replaced. The process can also involve re-powder coating the frame and weight plates, reconditioning the guide rods, and replacing upholstery and rusted hardware.

Cardio equipment

Given the electronic circuitry, cardio refurbishment is more sophisticated than the process for strength pieces. In Global Fitness’ five production bays, there are anywhere from 10 to 30 treadmills at any one time. The company dismantles them down to the component parts, and all metal parts are sandblasted to strip off the paint and any rust. These parts are then powdercoated and baked, as manufacturers do with new equipment. Rollers are built with new bearings, motors are rebuilt with new brushes and bearings, consoles and stickers are replaced, and the belt and deck are replaced.

Says Greenberg, “We look at the manufacturer’s product standards, and try to replicate them; we are not looking to reinvent or redesign.” There can be exceptions with older machines that remain popular. For example, the color of the frame may be changed to something more contemporary.

For cardio, Graf says the equipment is broken down as much as possible to its component parts. Everything is cleaned, drive and running belts are replaced, bearings and rollers and electronics are checked, and the machine is repainted. The console overlay is often worn out, so it is also replaced.

For a treadmill, Kacor repowdercoats the frame, and puts a new belt, deck, keypad and overlay on it. Also, motor brushes are replaced, and electronics and the elevation motor are inspected.

For cycles, Kacor replaces the pedals, crank arm, pedal bearings, chain or belt, overlay and keypad. A new battery is installed, the shroud is repainted, and the electronics and alternator are inspected.

Possible risks. Generally, cardio machines exact a heavier maintenance toll on fitness centers. Is this reflected in refurbished equipment? “The safer bet would be non-impact machines, like bikes and elliptical trainers,” says Hensely. “The treadmill is the one item that [gets] the most wear and tear onparts.”

As a general rule, the older a piece of equipment, the harder it is to get replacement parts, particularly for cardio equipment. “Reconditioning on cardio machines depends on parts availability,” says Graf. To compensate for any lack of availability, Graf says refurbished equipment suppliers trade information and parts back and forth, so there are few cases when equipment cannot be fixed.

Warranties and financing

Global Fitness offers a six-month parts and labor warranty on all cardiovascular equipment, and a one-year warranty on motors. Frames have a two-year warranty, given that they are repowdered, and the company also offers extended warranties of up to two years. Graf says Rebirth Fitness offers a 90-day parts and labor warranty on both cardio and strength equipment. There is also a possibility to extend it to one year, depending on the piece, but it is not commonly requested. Kacor offers a six-month parts-only warranty on remanufactured equipment, and no warranty for “as is” equipment, says Hensely.

Some service support may be available. Global Fitness has a database of technicians to drawn on for work required in any particular locale. This is in similar fashion to a manufacturer’s service support program. Financial support is limited. Global Fitness can set clients up with leasing and financing, as manufacturers would do, says Greenberg. The company has a preferred vendor rating with American Express Leasing.

Graf says FitnessPlus.com INC. does not offer any financing options for buying refurbished equipment, but it does have arrangements with a few leasing companies that can then lease equipment to customers. Kacor also offers a leasing program for commercial settings, says Hensely.

Shipping costs

In addition to the cost of equipment, customers need to factor in shipping costs, which can be expensive. Besides the actual transportation from point A to point B, there is likely to be an additional cost for delivering the equipment to a specific destination — for instance, if a customer wants a treadmill set up upstairs. Global Fitness sets up shipping and installation. “Our aim is not to profit from shipping; we make the money on equipment,” says Greenberg. A decent-sized fitness center’s remanufactured equipment order could fit in one truckload. Door to door across the country might cost around $3,000, he says.

Graf says FitnessPlus.com INC. tries to grade trucking companies to ensure good service, but there is a practice in the transportation business to handoff business to third-party carriers.

Hensely says the average cost for shipping is $200 to $400. Kacor offers inside delivery with its Gold Service, by which equipment is unpacked and placed inside the facility.

Diligence

The refurbished equipment industry is yet to mature. Consequently, fitness centers may encounter a few suspect operators when looking to buy. “It is somewhat of a rogue industry, so carry out background checks, read contracts carefully and shop around a bit,” says Graf. FitnessPlus.com INC. sells many things on eBay, and Graf adds that customer feedback there can be a useful indicator.

Says Greenberg, “If [equipment is needed for] a full health club, few companies can easily put together something like that.” For only a few pieces of equipment, more companies are available. “Do research, and look at the Better Business Bureau report,” he adds. Unfortunately, there are a lot of companies claiming to sell refurbished or remanufactured equipment, and few are doing a very good job of it, says Greenberg. Many of these companies have now disappeared.

Greenberg advises people to check that equipment is available in stock and ask to see digital photographs of the pieces. “The best advice for anyone looking to spend a large sum is to actually go out and see the equipment yourself,” he says. For clients spending $50,000 or more, Global Fitness will fly them out, so they have a chance to check things thoroughly. FitnessPlus.com INC. also pays to fly out customers in if they are setting up a whole fitness center.

Hensely urges customers to ask the right questions, such as where the machine came from, how old it is, and what was done to remanufacture it.

With a little diligence, refurbished equipment can enable facilities to offer competitive exercise environments for members, with a good trade-off between equipment performance and cost. FM

Supplier Profiles

FitnessPlus.com Inc refurbishes all commercial-grade equipment. Equipment is selected from the industry’s top manufacturers, including Cybex, Keiser, Life Fitness, Precor, Quinton, StairMaster and Trotter. The company provides refurbished equipment around the world, with recent orders including Germany, Mexico and the Middle East. Domestic business includes fitness centers, police stations, schools and physical therapy centers.

Smart Buying Tips

Before buying refurbished equipment, follow these tips:

Go behind the scenes. Find out what is involved in refurbishing your desired pieces of equipment with each company approached.

Check inventory. Look for confirmation that the equipment you want is available now. For outfitting a complete gym, look to the bigger operators.

Call references. Ask for references from prospective sellers, and check out whether these gym owners are content with their refurbished equipment, price satisfaction and ongoing service support.

Guy Brown has been a manager in international leisure and hospitality for several years in private facilities and with international hotel chains. He also writes for international business, and travel and medical magazines.

©Copyright May 2004, Fitness Management Magazine, Leisure Publications Inc., Los Angeles, Calif., www.fitnessmanagement.com