Heavy Equipment Market Problems IronBlock Is Designed to Solve

Published on 02 Dec. 2017

The heavy equipment market is reaching $447 bn in sales annually, with over 17 million trade deals made between the biggest specialized machinery market players every year. At this point, the mechanism these deals must follow is far from perfect – for the supply contract to work, a third party must ensure all the contractual obligations are fulfilled, which leads to an increase in the total cost of contracts.

Why does it happen?

Heavy equipment is expensive specialized machinery. The price of one unit (used) can run up to a few million US dollars, while new equipment can be even more expensive. Thus, the buyer must be sure that he knows the most valid information about the equipment and that all the contract conditions will be fulfilled without a doubt. Often times the buyer and the equipment in question are located in different regions, making personal inspections rather difficult. Especially when they’re in the different parts of the world.

Today buyers turn to agents and special companies who take responsibility for and guarantee the validity of information about the equipment. It proves difficult to guarantee their professionalism, and sometimes they turn out to be scammers. All the while every middleman between the buyer and seller charges commission fees for risk coverage and other services. If the buyer chooses multiple machinery units, he is forced to work with multiple companies simultaneously, which makes the purchase longer and more difficult. Legal support is also a financial concern, yet a much needed service to secure the deal and ensure it takes place at all.

How it should work

The perfect scenario for both the buyer and seller of heavy equipment is to be able to lock the deal down without a series of middlemen. This will drive the total price of the contract down substantially and simplify the transaction processes.

Today the specialized machinery sales mechanism looks something like this: the seller decides to put his equipment for sale, posts ads on the web, then the potential buyers representatives start coming in to check the machinery in person. If the buyer is satisfied, the deal enters negotiation. If only both the seller and buyer agree on the terms, the equipment changes hands. Should we mention a deal can stay stuck in these loops for years?

A truly efficient sales model for the heavy equipment market should look fundamentally different: after the buyer decides to purchase specialized machinery, he should already have access to comprehensive and verified information on the desired equipment and its full conditions of purchase. This would allow for a quicker sale while cutting the unnecessary expenses and making quick and secure transactions. At this point in time, not a single solution on the market has been able to put this concept into practice.

The IronBlock project solution

IronBlock has a unique decentralized heavy equipment sales platform in development that will allow its users to receive complete and verified information about the equipment, and conduct secure purchase deals.

Although this may sound rather sensational, the daily processes on the platform will be quite simple. All the listed equipment condition data will be stored in a distributed storage based on the Ethereum blockchain, in which the platform is embedded, this includes certificates, data reports and service schedule charts. Data validity will be ensured by a network of authorized service centers and agents locally. Every user willing to buy heavy equipment will have access to this huge body of data, where he can choose a listing and be sure that the information presented is true.

Since there is no more need to go on location to verify the equipment in person, the parties can go straight to making a deal. All the machinery sale conditions are written in the smart contracts on the platform, which guarantees their fulfilment and transaction security. Once the deal is made, users can go straight to payment, bypassing all the paperwork and banking limitations – a convenient IRB payment system is designed to facilitate this process. You can buy IRB during the IronBlock ICO: first, PreICO starting December 12 through January 14, or during the ICO stage in March-April 2018.

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