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A New Age: Getting On Board With Online Equipment Auctions

Jan 28, 2014 - 5 years ago

By Supply Post

by Sue McGregor, Managing Director, IronPlanet, Canada

The world’s first auctions took place during the Roman Empire as a way to sell winnings after military overthrows and to arrange marriages for women. Since then, auctions have evolved drastically, including those for used heavy equipment. During the Great Depression in the 1930s, farms and farming equipment were often sold at foreclosure auctions. Throughout the 1900s, older, used equipment was pushed through the auction market as manufacturers created newer, better models. Physical equipment auctions, as we know them today, gained popularity in the 1970s.

In 2008, auctions were roughly a $268 billion industry and the National Auctioneers Association named equipment auctions as one of the industry’s fastest growing sectors. Equipment auctions are thriving in part due to the flexibility and accessibility of the Internet. With 2.4 billion Internet users worldwide, many people now shop for a seemingly endless selection of goods and services online, including cranes, wheel loaders and dozers, from the comfort of their homes, offices or even on the go using a smartphone or tablet device.

And it’s not just young people who are fans of the World Wide Web. According to a 2013 survey by the Pew Research Center, 92 percent of Americans 30 to 49 years old are Internet users. Eighty-three percent of 50 to 64 year old adults use the Internet and 56 percent of senior citizens (65 years and older) use the Internet. The Internet is also widely used across Canada. The Canadian Internet Registration Authority (CIRA) reports that nearly eight in 10 Canadians are online and the vast majority are daily users. Canadians also spend more time online than anybody else in the world with an average of 45 hours per person per month. This is almost double the global average.

Thus, it’s no surprise that tech-savvy equipment buyers and sellers of all ages around the world are gravitating towards online equipment auctions. Distance and language barriers no longer stand in the way of finding or selling used equipment. Those who are not as comfortable using the Internet, or are still on the fence about participating in online auctions, should consider the following benefits:
• Online auctions enable buyers from around the world to bid on items, which in turn allows sellers to generate more interest in their equipment rather than relying on limited local participation at physical auctions; • Buyers can use more capital for bidding, rather than reserving some of it to travel to a physical auction;
• Buyers and sellers save time because travel is not required and buyers can choose to bid based on auction schedules that better fit their needs;
• Online auctions are accessible from multiple technology platforms, including computers, phones and tablets;
• Customer service representatives are available to help sellers list equipment and ensure buyers know when an auction will offer the equipment they wish to own;
• Sellers enjoy faster time to cash and higher net proceeds because online auctions occur more frequently than physical auctions and the equipment doesn’t have to be moved to one location for bidding;
• Online auctions are easy to navigate because buyers can search for equipment based on sector, type, auction date and more.

Some may believe viewing equipment online can’t compare to physically looking at the equipment. But at physical auctions, buyers may not have the opportunity to inspect and operate equipment or review important analyses such as fluid results. Additionally, the information provided during the sale may not be entirely accurate. Reliable online auctions provide detailed descriptions and images of equipment for buyers so they know what they’re purchasing ahead of time. Buyers should ensure the auction site guarantees the reports to certify they provide a clear and correct representation of the equipment for sale and that the auctioneer will make right on misrepresentations.

As widespread use of the Internet continues to spread, online heavy equipment auctions will become the preferred model for buying and selling used equipment. Similar to the way Amazon and eBay are overtaking physical big box retailers, online heavy equipment auctions will continue to put pressure on the physical auction events as more people look to buy and sell equipment conveniently and efficiently.

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