How could you make the best out of your used power plant sale?

How could you make the best out of your used power plant sale?

[Oct. 2020] Despite owners and operators hanging on a lot to their power plant facilities – at some point in time they have to say good bye to them. A sense of reality is crucial at this important step of selling these assets.

Most people value the things they own far too high, while someone who wants to buy an asset second-hand assigns a more realistic value to the object of interested. Business psychologists call this the “endowment effect “.

This phenomenon plays a major role in used power plant sales. Our Marketing expert A. Stephan knows this quite well: “Owners expect a far too overvalued price for their existing plant or used equipment!“ Many sellers like to regain their costs to secure ongoing operation and for getting highest availability over the last years: They like ot get back the money spent for exchanged generators or transformers, the last main revision as well as for the new monitoring system. That a buyer possibly has different interests and is not even accounting for any of the aforementioned aspects, is often misjudged by the owners.

The first step to a successful sale is to find a fair price for the own power plant asset. It is worthwhile to observe the market and to find out for what prices comparable systems are offered in order to achieve a grasp for the market value. troveo provides such market-based valuations and creates a selling brochure on request, too. 

A starting price estimated too high may lead to a devastating outcome: “With excessive price expectations, sellers might destroy their own selling efforts“, affirmed our market analyst H. Aruci. “If an interested buyer realises that an asking price is too high and unrealistic, this asset will become a kind of shelf warmer and not sell at all. For this reason, I again and again have to work with existing powerplants that I know from other internet portals for years.”