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Article Written By: Clayton Arnold
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While Ontario’s economy was dominated primarily by agriculture during the 1850s, industrial growth and urbanization helped fuel the development of metalworking, machinery, farm implements, and related products Toronto experienced exceptional growth in terms of being a center of manufacturing and transportation activity. Known as the manufacturing heartland of the country, this industry has experienced a decline in Ontario over the past decade. Despite this, Ontario is still Canada’s primary region for manufacturing industries to establish themselves.
To this day, manufacturing continues big business across Ontario. Fifty-five percent of the goods manufactured in the province in 2016 arose from three industries: transportation equipment, chemical and food. The transportation equipment industry raked in sales of $108 billion while the food and chemical industries delivered revenues of $34 billion and $22 billion, respectively.
That same year, the revenues realized from manufactured goods in 14 of Ontario’s 21 industries increased by a total of $11 billion, the fifth year in a row that revenues have climbed.
Metalworking equipment in Ontario is utilized in a staggering array of industries and applications. From the basics of construction and mining in the form of engines, diggers and tractors to the cusp of innovative technologies like aerospace and additive manufacturing, metalworking equipment is in high demand to meet the continuously-growing needs of Canada, the United States and beyond.
Ontario is responsible for 37 percent of Canada’s gross domestic product (GDP). Each year, Ontario produces a gross domestic product of over $18 trillion. According to figures released by Statistics Canada, more than $258 billion was shipped by businesses within Ontario’s powerhouse of a manufacturing industry. Ontario boasts the third-highest number of manufacturing employees of any state or province in the United States and Canada. Only California and Texas have more.
Vehicle production — an industry in which many types of metalworking are pressed into labor — is big business in Ontario. In fact, the province is North America’s largest sub-national vehicle assembly locale. Eighty-eight percent of the vehicles produced within the province’s borders were exported. The vast majority of these were bound for the United States.
The production of minerals in Ontario is an industry worth over $10 billion. The province is one of the top 10 regions in the world for the production of both platinum and nickel group metals. Copper, cobalt, gold, zinc and silver are also produced in great quantities in Ontario.
In southern Ontario, the sedimentary rocks located there form the basis of the province’s gas and oil industry. Non-metallic minerals that are produced in southern Ontario include structural materials like sand, stone and gravel as well as lime, gypsum and salt.
With the installation of the Trump administration in the United States White House, the president went about keeping his promise to dismantle the North American Free Trade Agreement (NAFTA). This involved renegotiating the agreement’s terms with new tariffs being slapped on aluminum and steel imports entering the country as of March 2018.
As of this writing, the province continues to be one of the largest trading partners with the United States and the region comprises the heart of NAFTA. Of the more than $1.4 billion that moves from Canada over the border to the United States every day, trade between the US and Ontario specifically accounted for over $716 million of it.
Ontario is Canada’s top producer of fabricated metal goods. More than 40 percent of all the industry’s manufacturers are located within the province’s border. According to projections released by the Canadian government, several factors make it likely that the industry will continue to flourish. Strong manufacturing output, steady construction and improved economic growth support the fabricated metal goods industry. Additionally, it’s projected that conditions on the labor market will be stable which is also favorable for the industry.
The fabricated metal product industry is comprised of nine groups: More than half of the sector’s Ontario workforce is employed in turned product, architectural and structural metals manufacturing, screw, nut and bolt fabrication and machine shops. Hand tool production, wire product and spring product manufacturing and cutlery production employ the fewest workers.
Only the food processing industry and the motor vehicle and parts industry employ more workers than fabricated metal product manufacturing. A few of the types of businesses that use the end products generated by the fabricated metal product manufacturing industry are oil and gas extraction, construction, metal manufacturing, automotive and machinery manufacturing.
This diverse demand for fabricated metal product makes Ontario a great place to sell used metalworking equipment because this allows businesses to recover capital for equipment they are no longer using. This also allows for other fabricated metal producers to look at purchased second hand-equipment as a cost cutting measure to remain competitive in the marketplace.
With the amount of competition within the industry, every other firm is looking for a competitive edge. By adopting an asset recovery or investment recovery strategy you can begin to regain capital from old or unused equipment.
Selling this used equipment allows you to recover more capital, thus allowing you to re-invest this capital back into the business while also potentially removing and clearing out vital storage space for more operation critical functions. While there are many methods of asset recovery, there are clear benefits and risk with each option. The most common options of asset recovery are: selling used equipment, donating used equipment, and scrapping used equipment.
Donating used equipment is one of the options that will have the least monetary return when examining asset the different solutions. Essentially this is taking the used equipment and looking for a charitable cause and providing them with ownership of the equipment at no cost. A common example of this would be donating used lathes or drill presses to a local trade school or high school. While this option may have limited monetary value this may provide value in the form of goodwill in the eyes of the local community or allowing you to fulfill your corporate social responsibility pledge (CSR).
Scrapping the equipment may provide slightly more value when compared to donating the equipment, however, scrapping does not yield the highest potential return. The monetary return on this option depends heavily on the price of the scrap metal for that time. With the price of scrap volatility in the market, this could allow you only receive a fraction of what you may receive if you were to choose another option.
The final option can be the most lucrative option, reselling used metalworking equipment allows you to get fair market value for the equipment. However, when looking to sell the equipment there are several factors you must to be aware of. These factors include: where the item is sold, how the equipment is marketed, and the cost that goes along with selling the equipment.
Previous we have stated the demand for metalworking equipment and machining equipment in Ontario, because of this online industrial machinery auctions can be the most effective method of selling to qualified and interested buyers.
Online industrial auctions have made the process easier and more profitable for those who are too busy to host an onsite auction or whose budget won’t allow expensive advertising. Reaching the audience that’s looking for the specialized metalworking equipment you’re selling means relying on a proven industry leader. With a clean and straightforward interface that’s user-friendly for busy entrepreneurs and business owners alike, Aucto will change your mind for the better about online auction marketplaces.
While Aucto may not have the same number of users as other online marketplaces such as Amazon or eBay the difference is the buyers. Focusing on industrial auctions exclusively Aucto provides specific categories, for all industrial equipment, allowing for buyers to easily browse items. When working with Aucto you can be certain that your listings are always in the right place. Aucto makes it easy to get your used metalworking equipment out in front of qualified buyers with proven track record.
While there are many factors as to why other businesses in Ontario are selling their used metalworking equipment, the benefits remain clear. From recovering addition capital to gaining an edge on competitors. Corporations looking to take the biggest advantage of this strategy should look to an online auction platform with proven and reliable buyers and an exceptional track record in the industry such as Aucto.
Have a question about buying used industrial equipment or selling used industrial equipment online? Give Aucto a call at 1 (844) 326-7339 or email at sellers@aucto.com, and our team of experienced online auctioneers and customer support team will be more than happy to answer them.
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