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Online iron sales expand exponentially during the COVID crisis
The trend toward machinery selling at online auctions over 20 years when eBay began to feature farm implements. Since then the online-only iron transactions has grown steadily. For example, it is common for a weekly bigiron.com sale to auction off 1,500-plus pieces of equipment!
Still live auctions enjoyed popularity. . .until COVID hit. A few live auctions scheduled for what remained of March and all of April awere canceled. But far more were delayed . . .and then successfully held online.
So did the COVID disruption doom live auctions to the scrape yard?
Yes and no, says Scott Steffes of the Steffes Group. “We have enjoyed huge success with our online only sales and will continue to expand those in the future,” Steffes observes. “But, at the same time I certainly see the demand for live auctions as well as they are often significant life events (as is the case with retirement or estate sales).”
Steffes as well as Luke Sullivan of Sullivan Auctioneers estimate that often 50% or more of equipment sold during live sales was bought online. “And that has been growing steadily since farmers came to trust online auction transactions,” Sullivan adds.
The Steffes Group had already expanded into online only sales. “I would estimate 38% of our sales are not live,” he adds. "Covid-19 may be hurting many areas of the U.S. economy, but strong demand has continued for tractors, combines and other farm assets. During the first four months of 2020 our company has conducted 170 auctions."
Other auction houses are likely going online after COVID subsides, feels Kyle McMahon with Tractorzoom.com. “I have always believed technology in agriculture has been 5 to 7 years behind Silicon Valley. That’s not always due to a lack of innovation, but is a lack of adoption by producers for various reasons.,” McMahon points out. “That said, COVID has forced adoption of online bidding. We will see a higher number of farmers bidding online after COVID than we did before COVID, but live onsite and simulcast auctions will forever have their time and place.”
Accentuating online sales is mobile bidding. You can sit in a cab planting or harvesting and bid on equipment that may be local or located several states away. And auction outlets have learned to provide shipping (for a cost) as part of the transaction which further encourages purchases.
Demand was strong for tractors, combines and sprayers throughout the period, regardless of the auction method.
“The market is discriminating. Well-maintained equipment with low hours commanded a strong (price) premium,” said Steffes. “We sold the highest priced tractor in the history of our company this spring, a late model John Deere RX.”
What has made the adoption of online auction by buyers and sellers alike is the trust both groups hold in the system. Online sale transaction are nearly seamless and completely secure.