The domination of the internet in the 21st Century has helped in the resurgence of a long-time method of trade called auctions. Millions of e-commerce websites, including some popular ones such as eBay and Craigslist, have re-popularized this method of buying and selling. While many people are well- acquainted with this age-old trade, there may still be some who do not know very much about this way of doing business. Following is some information about the history of the equipment auction, how it works, and its advantages over fixed priced buying and selling.

History

Auctioning has always been an unconventional method of buying and selling in comparison to the fixed price method; however, it has been in practice for centuries, often for selling uncommon items with values not well established. The benefit of this method of trade is that the value of the item sold will be determined by the bidders, thus making it a true market value.

Bidding was used to sell unconventional things during early times in history, ranging from spoils of war to slaves. Romans used auctioning as a means to liquidate assets confiscated from its debtors. When the American Civil War broke out, this same method was used by the military to liquidate goods that were seized and these sales were conducted by colonels.

As the nation became more industrialized, the fixed price trading system that we know today became more popular, pushing auctioning almost to extinction. With the advent of the internet, this dying method of trade has experienced a resurgence and is now used for various commodities ranging from clothing, food, and antiques to even heavy equipment.

Operation

Auctioning is a unique trading method in the sense that buyers dictate the value of the item being sold. An auctioneer or auction company hosts the event and is in charge of setting the time and place of the event as well as marketing the items and gathering the buyers. Prior to the start of the auction process, the items are open for inspection, so potential purchasers can assess the condition of the items being sold and determine their worth.

During the actual bidding, the item will be presented to the crowd and a reserve amount or the lowest acceptable price will be announced. Interested purchasers can then start to outbid each other with an amount higher than the last. Once there is no higher amount, the last bidder will be announced as the winner, giving them the right to purchase the item.

Benefits and Advantages

• Quick Turnover – Sellers often have the problem of getting items liquidated quickly enough to avoid further depreciation; this is particularly true with highly specialized equipment. The combination of an aggressive marketing strategy and the sense of urgency that bidding creates make the turnover rate much faster.
• Affordability – Buyers often go to an equipment auction for the chance to purchase a specialty machine at an affordable price. Because it is the buyers who dictate the price, getting a good deal is almost always within reach. It is also important to remember that not every buyer will end up with a good deal, especially when there is a huge demand for the item. In such cases, the final price may easily go well over its actual market value.
• Fast Transaction – For both buyers and sellers, the biggest advantage of an auction is the fast transaction. Conventionally, items to be sold will be brought to the site for display and bidding. Once the gavel hits, the winner can immediately pay for the purchase and leave with the item. The seller will also get their revenue once the money for the item has been received.

Auctioning may be a somewhat unconventional method of trade, but it also has several beneficial advantages for both buyers and sellers alike. An equipment auction has been able to save buyers money for many years. Hopefully this article has provided some helpful information regarding the history, the process and the benefits of this age-old method of trade!

Call JJ Kane Auctioneers About Our Next Equipment Auction Sale!

Are you interested in an equipment auction to buy a used specialty vehicle? Contact JJ Kane Auctioneers at (856) 764-7163 to ask about their next auction so you can find the perfect vehicle for your needs!