Used equipment online boom fuels change in buyer and seller trends, says Ritchie Bros.

Everywhere I look on social media right now I see yards emptied, record-breaking deals for new equipment and an industry that has jobs jobs jobs on offer left right and centre. Not to mention the amount of congratulations posts I have sent on Linkedin to those moving onwards and upwards in an industry that is booming.

And these changes are having a fundamental impact on not just the availability of new equipment, but the hunger for used equipment. With the results from a recent Ritchie Bros survey and its March auction, a year on since it went online only due to the pandemic, this market has changed dramatically. And I expect some interesting figures to come from its next auction with bidding commencing now and completing on 27th-28th May

To find out more I recently caught up with my good friend and UK Sales Director, Rupert Craven to find out how its timed auction lot approach to the UK and European markets has sparked a change in both buying and selling of used equipment.

This all comes on the back of a year where factory closures have reduced the supply of new equipment and the yards of dealers have been emptied by a 30% increase in sales in Q1, according to the recent report from the CEA.

And it’s not just the UK that is gearing up for an upturn in productivity this year. Across Europe operators are adding to their equipment fleets, moving towards online buying and selling. These trends were all highlighted during Ritchie Bros recent customer survey and backed up by statistics from across its European auctions.

The survey shows that UK plant equipment owners have been holding onto most to their fleet in 2020, with 39% claiming to have sold no machines last year, with demand for new equipment soaring. This compares against a total European survey average of 25%. In addition, with the UK market dominated by plant hirers, 58% of UK respondents said they also expected to rent more equipment, highlighting a ‘top-up’ approach to plant equipment fleets.

Talking about the data, Rupert Craven, Sales Director UK & Ireland at Ritchie Bros, said: “So called ‘shovel ready’ projects like HS2, housebuilding and the acceleration of broadband rollout programs are really driving demand. But what is also clear is that there continues to be growing confidence and therefore participation in online auctions across the region, which is driving both demand and bidding activity.

“This has continued to grow throughout the pandemic as individuals have built a greater acceptance of both selling and purchasing assets online through trusted providers. This is reflected in the survey results, with 71% of all participating construction businesses seeing using online channels to buy and sell plant machinery as a solid replacement for in-person methods.

“In March 2020 we switched to using our tried and tested timed auction software, previously used for smaller lots like tools. Since this time, we have seen continued growth in registered buyers, engagement and volume of bids. Our own data shows website traffic up 13% over the year with more than 140,500,000 visits, online bidder registrations up 77% to 1.2 million bidders, and accepted bids increasing by 65% to 15 million. And buyer feedback has highlighted features like auto extended which acts like a digital auctioneer, as being an important change to give more time to place additional bids.

“This is what is really driving the market, for example, in the UK 63% of our lots went into extended time at our last auction, compared to 59% in Italy and 69% in Spain. When we look closer into these figures it’s in-demand items like dozers, machine control excavators, ADTs and cranes that businesses are holding on to which are extending for longer.”  

Rupert Craven continues: “Buyers from the UK have always seen a benefit in visiting and seeing the equipment in person before placing bids and this is why we have also worked hard to keep our yard in Maltby open and COVID-safe for visitors. Along with this option to personally inspect items at the auction site, we have added more imagery and videos for auction lots listed for sale on their website.”

The growth of online equipment sales has also led to an explosion of data. In parallel, the equipment owners are looking for heavy equipment data to base fleet management decisions on. Fresh market insights, equipment price performance and the ability to identify high-demand regions enable the equipment owner to mitigate risks and bring clarity in fleet management.

Craven concludes: “Using data models and tools, we can see what the market is doing for particular asset groups and adjust the customer’s selling strategy accordingly to optimise returns.”

And from talking to numerous players in the market I can also testify to the strain that currently faces the market with OEM’s and dealers announcing longer waiting times. Some have even announced the sale of all the equipment they can make until the end of the year.

It's an interesting time for the industry and I am sure the next auction on the 27th - 28th of May will be hotly contended by buyers looking to plug gaps in fleets and capacity. I will be visiting all the lots next week to take a closer look. If you want to see them for yourself visit www.rbauction.co.uk