Online Equipment Auctions Growing In Popularity

By Jeff Griffin, Senior Editor | August 2008 Vol. 63 No. 8
A ‘ringman’ monitors an IronPlanet online auction.

Groves: Customers tell us frequently that on line auctions are a quicker, more profitable way to acquire and dispose of used equipment than on line auctions. By reaching a much broader audience more frequently, and by selling equipment on line, IronPlanet auctions generate market value or better while reducing selling costs by up to 11 percent.

How fast are on line auctions growing in terms of machines listed? Sales volumes? What about the future?

Branch:
On line auctions are growing like our complete auctions, not only in the volume of transactions but also in acceptance by the underground construction industry. Our customers are buying more underground construction equipment, more valuable underground equipment and more of it on line. In the past five years, the amount of underground equipment in significant categories – cable plows, boring and drilling machines, trenchers, crawler and wheel loaders, pipe layers and track tractors, etc. – in our on line and on site auctions increased almost 50 percent, from more than 18,500 units to more than 27,500 units. The total value of that equipment increased 88 percent from more than $454 million to more than $850 million. The proportion sold to on line buyers doubled from 10 percent to almost 20 percent. We're also seeing increasingly global markets accessing our global inventory of specialized underground equipment – about 65 percent of all underground equipment leaves the region of the auction, meaning state, province or country.

Groves: IronPlanet has been growing at a phenomenal rate. During the first quarter, IronPlanet gross auction sales totaled nearly $80 million, an increase of 135 percent over the first quarter of 2007. We held our largest auction in company history on Jan. 31, with more than 12,000 bids placed and gross auction sales of $19 million. Our future growth potential looks equally promising as we look forward to growing our new operations in Canada and Australia with further expansion planned in Europe by the end of the year.

Ritchie Bros. Auctioneers, USA (800) 663-8457, Canada (800) 663-1739, www.rbauction.com
IronPlanet, (888) 433-5426, www.ironplanet.com