As needs and demands change, equipment fleets must transform to keep with the times. Often, the challenge of selling used equipment is intimidating and can be expensive. However, in recent years, online equipment auctions have gained popularity as a viable means for buying and selling used equipment.
Perhaps the biggest benefit of an online format is the ability to reach a larger audience in a cost effective manner. Add to that the ability for year-round sales opportunities, and it's easy to see why online auctions have seen such a spike in popularity from buyers and, especially, sellers. Whether a seasoned online seller or a first timer, the following tips will help ensure best selling results.
1. No Reserves
There are a variety of ways online auctions can be structured. A format growing in popularity is the no-reserve auction format. The no-reserve auction proves to be an effective method for achieving fair market value for equipment, but buyers must understand the selling format.
"With a no-reserve format, there's no set minimum price," explains Ron Lucas, President of Goodland Greenline, an equipment dealership located in Goodland, KS, with a sister location in Wheeler. With more than 10 years experience as a buyer and seller at online auctions, Lucas has been on both sides of the game. "When a seller lists a piece of equipment, they are virtually guaranteed the unit will sell – and at its fair and current market price."
Because market conditions can change daily, sellers need to realize that the sale price of a piece of equipment can vary drastically from day to day. Lucas continued, pointing out that variances shouldn't scare away sellers, because often the seller will get more than he or she expected.
"Just be prepared for the risk and reward," Lucas advises.
Even though sellers need to embrace the risk and reward mentality, they need not go into the sale blind. Prior to listing, it's important to research not only the equipment being sold, but also the market trends. Though there are always fluctuations, researching past sales will give a good ballpark prediction of an expected sale price.
Some online auctions will provide records of past sales, making it easy for sellers to access. Again, don't forget that timing and market fluctuations will be a factor.
3. Presentation is Key
A picture is worth a thousand words – so be sure it's sending the right message. Prepare equipment for best showing by giving it a thorough cleaning and detailing, and fix the small things.
Additionally, take plenty of photos and make sure to show the piece of equipment in its entirety. Don't attempt to hide any flaws the equipment may have.
"It will be obvious if you're trying to hide something. That will damage your credibility right from the start," warns Denise Klinefelter, an Iowa farmer and frequent online auction participant. An admitted one-time skeptic of online auctions, Klinefelter is now a successful, seasoned seller, and well-versed in what buyers want and sellers should deliver. "Potential buyers will always assume used equipment has at least one flaw, so sellers must be upfront about it. The buyer will appreciate the honest approach."
Some online auction companies provide a complete marketing service, including sending a representative to a seller's location to take the photos. If that's an option, take advantage of it. These experts know how to showcase equipment in the best possible light.
4. Open and Honest
Just as it's important not to hide anything in a photograph, don't hide anything when speaking to a potential buyer. Sellers can expect to get several calls, and buyers want to hear it all – the good and the bad. Trust, reliability and open communication are keys to making a buyer comfortable, so be sure to establish both from the start.
5. Speaking of Speaking...
Establishing a line of communication and creating a personal connection with buyers is crucial. In the case of first-time buyers, there will always be a bit of hesitation to make a significant purchase from an "unknown."
"While some auction companies see online auctions as an opportunity to decrease services, we take the opposite approach," says Ron Sock, co-founder and CEO of Big Iron Auction Service. "We actually capitalize on the opportunity of increasing services by facilitating the direct communication between buyers and sellers."
Such platforms encourage communication between the buyers and the sellers and are particularly successful because of the open lines of communication. In some cases, if the seller is close enough, potential buyers should be encouraged to come out and see the equipment. Whether by phone or in person, meeting the seller often establishes a level of comfort. People will always feel more comfortable buying a real piece of equipment from a real person.
6. Partners Speak Volumes
The final critical element to a successful online sale is find the right listing company with which to partner. Just as it's important for sellers to establish credibility with open, honest and upfront communication, it's important to work with an auction company known for those same ideals.
Every seller should first find a company offering a platform that suits his or her comfort level, then make sure the company understands the equipment and the auction business. Check its record and examine its growth pattern, reputation and experience in the auction arena. Many online auction companies started in the live auction venue and have many years of auction experience. That experience can prove very useful to both buyers and sellers.
Online auction opportunities have opened up new markets and possibilities for both buyers and sellers. Remembering a few simple tips can make the selling process easy, enjoyable and profitable.