Interview: Kari Taylor of Ritchie Bros. talks booming equipment auctions market
By Jenny LescohierJuly 27, 2021
Equipment auctioneer Ritchie Bros. has had quite the busy calendar year.
From acquiring Rouse Services last October to announcing its largest-ever, single-owner auction for Barrileaux Inc. (set for Aug. 10-11 in Houston, Texas), the company’s 2021 is so far indicative of Ritchie Bros.’ recent market report that showed auction prices rose 5% in 2020 – despite the Covid-19 pandemic.
CONEXPO-CON/AGG 365 talked to Kari Taylor, Chief Revenue Officer of Ritchie Bros., about the state of the used equipment sector, preparing for auctions and possible changes to the frequency of in-person bidding.
CONEXPO-CON/AGG 365: What is the current state of the used equipment market in the U.S.?
Kari Taylor: At Ritchie Bros. we are driving unprecedented demand across all our marketplaces, resulting strong pricing on almost every single asset category.
According to our July 2021 Market Trends Report, a free monthly report on pricing at Ritchie Bros., truck tractor prices are up 30% in the U.S. year over year, and medium earthmoving equipment and vocational trucks are both up 25% year over year. We are also seeing strong pricing for aerial equipment right now, up 20% year over year. It’s a seller’s market out there!
CONEXPO-CON/AGG 365: Why is used equipment a wise equipment acquisition strategy? What are the benefits that buying at auction offer the buyer?
Taylor: Purchasing used equipment can save you time and money. Unfortunately, Covid-19 has caused OEM production delays, so new equipment is hard to find, depending on what you’re looking for. At Ritchie Bros., we can have 70,000 items available in our upcoming inventory at any one time. So, while you might not be able to find a certain excavator brand-new, you can probably find a late-model, low-hour used one through our various marketplaces that you can put to work immediately. And, because it’s pre-owned, it’s usually cheaper than buying the item new.
Every company is different, with varied fleet strategies, and we are here to help with solutions, data and services.
CONEXPO-CON/AGG 365: What can equipment buyers do to properly prepare for bidding at an auction?
Taylor: Research the auctioneer, understand the rules or process of the auction and inspect the equipment. Additionally, buyers can get a head start by pre-arranging financing — through Ritchie Bros. Financial Services for example.
There are so many different places to buy equipment, but not all are equal. At Ritchie Bros. we try to make the buying process as fair, open and efficient as possible, with multiple bidding options and strictly forbidding owners bidding up or buying back their equipment. When you buy from Ritchie Bros., you know you are getting an item that has a clean title and is ready to go to work. We are publicly traded with a massive global network capable of finding you almost any equipment item you need.
Once you’ve chosen an auction company to buy from, make sure to research their different marketplaces, if they have multiple, as they may all work slightly differently. At Ritchie Bros., we have four main auction formats: our unreserved site auctions with an auctioneer and real-time online and onsite bidding, as well as mobile app bidding; our weekly featured online-only events at IronPlanet.com; Timed Auction events, where you can set and forget your maximum bid; and Marketplace-E, which features more premium items with Make Offer and Buy Now prices. For more details on each solution, I would encourage readers to check out our website.
Next up is inspection. When purchasing a pre-owned asset, it’s important to inspect the item before bidding. You want to know as much as possible about the item so your confident before the auction. At Ritchie Bros., we provide detailed equipment information, inspection reports with IronClad Assurance, dozens of high-res photos and videos of the item operating. We also have physical locations where interested bidders can inspect and test items in-person.
Once you have an idea of what you’re looking for, bring that info to our Ritchie Bros. Financial Services team, and we can get you pre-approved for financing before you bid, too.
CONEXPO-CON/AGG 365: What are some dos and don’ts for auction bidding?
Taylor: Don’t wait too long to bid! Go in confident, having done your research. You can check past sale prices for similar items on our website or through our RB Asset Valuator tool. Another great tip is to Watchlist all the items your interested in so you get an email reminder when it’s coming up for auction and don’t miss it.
CONEXPO-CON/AGG 365: How has online bidding changed the auction process? What are the benefits and drawbacks?
Taylor: Online auctions provide a larger marketplace for equipment, and generally, a larger audience results in stronger prices. However, many online buyers don’t have the capacity to travel and inspect items in-person, so it’s important to provide detailed equipment info, inspection reports and videos online to increase buyer confidence. In 2020, we also launched new data solution tools like Market Trends to help buyers better understand pricing trends so they can be even more educated when bidding.
Since moving to 100% online auctions in mid-March 2020 due to Covid-19, we have seen record-breaking bidder registrations and demand, with some
auctions registering 100% more bidders year over year.
CONEXPO-CON/AGG 365: Will there always be a place for physical auctions?
Taylor: The pandemic has made online buying the new norm, but customers have told us they miss the camaraderie and networking of being there in person. It’s clear our auctions have always been about more than equipment — it’s also an industry event for many of our customers.
The pandemic has also shown us and our customers how important physical locations are outside of auction day. Our sites provide a central display location for interested buyers to inspect, test and compare items, which is crucially important to building buyer confidence. Physical locations also allow us to offer additional services such as refurbishing to both sellers and buyers.
Our teams are very excited to be welcoming back customers for auction day in the U.S. in Q3 – according to state/local regulations, of course – and have some big events coming up, including our largest-ever pipeline construction event for Barrilleaux Inc. that will be live simulcast at our site in Houston, Texas.