Do You Know What Your Equipment is Worth?
Why does it matter to understand the value of medical equipment? I like to compare medical equipment value to a car’s value. When you own a car, it is vital to know what it is worth when it is time to make considerations on how and when to move on from it. There’s trade-in value to consider, outright sale value, tax value to donate (donation for tax deduction?), and even the value of repair/upgrade to keep it.
Medical equipment has very similar needs for understanding the value. Below are four (4) ways that understanding asset value is beneficial:
- Purchase: You are buying equipment as part of a business transaction from another provider. This could be through merger, acquisition, or a peer-to-peer buy between facilities. Understanding the value of an asset or group of assets is the only way to know you are paying what they are actually worth as part of the
deal. - Trade-In: Just like a car, trade-in value is important with medical equipment. When you know what your item is worth, it gives you leverage – you now have options. When it is time to sell or trade-in, you know the value and can negotiate a transaction that benefits you the most financially.
- Transfer: Legal ramifications in accounting require an appraised value for internal transfers/purchases. Understanding the value keeps you in legal compliance.
- Planning: What is the best way to forecast and budget? Even when expanding you must understand what you have. The value or what it is worth enables you to plan strategically, putting you in control of the forecasts and budget to make the best financial decisions.
These are just four points that make understanding value of medical equipment important. They will help you to achieve your goals for equipping your facility.
