In the rain-soaked mud of an enormous field in Stafford Springs, would-be buyers and sellers dickered over hundreds of pieces of construction equipment, scoring the best prices as quickly as possible.
Some buyers made out; some sellers made out; but in all instances, the deals were done quickly.
The Ritchie Bros. construction auction Nov. 17 featured 801 items, ranging from generators and jackhammers to golf carts and heavy-duty trucks to conveyors and cranes. It was one of more than 300 auctions held worldwide by Ritchie Bros. each year generating $3.5 billion in sales.
“Auction sales are definitely the way of the future,” said Randall Sanderson, general manager of T-Quip Sales & Rentals in New Hampshire, which was selling a variety of items Nov. 17. “It’s great. You get paid in full in 20 days.”
Unlike other forms of selling, many sellers get paid almost immediately following an auction, with payment coming within a month, even for the most expensive equipment. Auctions cut out the middleman.
The popularity of auctions has been fueled more by the Internet than the recession, Sanderson said. Buyers and sellers have a broader reach online, and there’s more of a direct relationship between the sales and money changing hands.
“It is just the way people want to buy,” Sanderson said. “Buying habits have changed.”
The Stafford Springs auction brought people from all around the world, but mostly from New England and Canada, where the currency is strong enough to make American purchases economical. The hundreds of people who dredged through the mud competed against online bidders — who make up 33 percent of Ritchie Bros. bidders — from places such as Ohio and Minnesota.
Golf carts were selling for $1,000 to $1,500. A 2003 Volvo sedan sold for $4,750. Ford pick-up trucks with more than 100,000 miles were selling for $3,000 to $6,000.
Auctions with trusted companies such as Ritchie Bros. are great places for companies to unload their used equipment, Sanderson said. The idea of the auction attracts bidders believing they can get a good value, but the competitive nature will often drive up the price. More often than not, T-Quip sells equipment for more than what a used equipment dealer was offering.
“The first items in a series seem to sell at really high prices, and they go down after that,” said John Flaherty, who came from North Oxford, Mass., to help his boss at R.A. Hammond Construction Corp. check out a mini excavator.
Indeed, the first heavy-duty truck on the auction block fetched the highest price near $6,000 while subsequent similar trucks were selling for half that amount. The first dump truck on the auction block — a 2006 Kenworth with 100,366 miles — sold for $85,000. The second dump truck on the block — a 1987 Kenworth of the same series with 62,834 miles — sold for $12,000.
The key is to know what to look for in a specific item and be disciplined about how to buy it, said Eric Weichselbaumer, owner of Avalanche Landscape Design Co. of Hampden, Mass.
Weichselbaumer came down from Massachusetts to Connecticut to buy a vibrator roller for his landscaping business. He said they typically sell for $3,000 to $8,000 depending on the quality. It is important to inspect the items thoroughly and assess their value before the bidding starts.
“If you know what you are looking for, it’s a good deal,” Weichselbaumer said.
Ritchie Bros. has been holding auctions since 1958, and Weichselbaumer has attended the ones in Stafford Springs for the last several years. They always have hundreds of items and hundreds of bidders.
The only impact the down economy had is the prices seem to be better more often than not, but it depends on what the item is, Weichselbaumer said.
One utility truck — a 1993 GMC with 114,300 miles — was purchased for $700.