I understand that Ritchie are to introduce a buyer's fee this summer-- which I guess is in line with other auctions --but it's another cost to soak up. Will it affect your biding?
No eqipment is at a all time low in the states but up here in canada its still busy as ever and people are still willing to pay.
take cash... Auctions here love it... they do add 3 to 10 % at auction here.. for credit cards.. There are a couple here that now charge a 10% buyers premium.. we stopped going to his auctions... He saw me at the farm store the other day... Ask where I had been... Not at your auctions that charge 10 %... He was a bit peod..
I spoke with a RB rep from Denver... He was excited about the new fee as it would provide better service for the customer. Should help earnings in the stock market. I will still buy from them.
Online bidding - 2% Credit card - 3% Lots under $10,000 - 10% HST tax in B.C.- 12% You mean there is more yet!!
I think the deal will be 10% on lots under $2,500 (as it is now). And a new charge of 2.5% on lots over $2,500 -- capped at $950 per item. It could add up if you're buying a few machines but at least it's capped. I've only been to auctions by RB and Euroauctions, but I'm guessing this is in line with others. Interesting to see what the new services for the customer will be. Any idea? Wouldn't people prefer just to pay less though?
If the services for the buyers have to do with machine inspections, warranties and/or providing better access to viewing, testing and history reports I would think it worth every penny. If the services are unrelated to any of that, I can´t see people being too excited about paying extra. One thing to keep in mind is that if something is going to cost you 10% extra, it will also cost the guy you´re bidding against 10% extra. It´s still a level playing field for buyers. A good deal is a good deal no matter how they divide the check you write at the end of the auction. It could be more of a deterrent for sellers than buyers....although I suspect if your iron is going to auction, you don´t have much say anymore in who sells it and for how much.
Iron planet gives way better reports on equipment condditions and way better and more pictures so if they plan on spending some cash to upgrade customer service componets im all for it.
I do agree Iron Planet give you a good overview of the unit.I would nrver go to a auction and bid on something I could not run.When checking eq.out if it would not run I would not bid on it.In over 20 yrs I never go the shaft.
Whats the sellers fee? Is that being cut only to be made up for by a buyers premium? Would it affect me as a buyer? Not really, whatever the top price I'm willing to pay for a piece of equipment (including premium) will remain unchanged. I'd probably grumble about having to pay an extra "tax" after the fact. But at the end of the day I still pay out the same amount. Alex.
A buyer's premium is tacked on after the gavel falls. If the auctioneer is at $100,000 when he says sold, then your cost is $110,000 plus any applicable sales taxes that might apply. In the seller's premium the gavel price is what you pay your taxes on because the seller pays the auctioneers commission. This is only a gambit to entice sellers into parting with their property at what is pitched as no cost. The trend through the industry is going this way and if all the other auctioneers are doing it, then Ritchie Bros., so the thought goes, should do it also. I have also seen both a buyer and seller premium where the commission cost is shared. The trend to look for is does this in fact reduce proceeds because of lower sale prices. Most people I know are very cognizant of what they are paying and will adjust their bidding strategies accordingly.
I have been selling at auction since 1994. Most buyers are fairly astute. Every once in a while you will see a person who has no experienced bidding. Auction buyers are the best in the world at managing money. That is why they can pay cash.
I think rbros has effectively abandoned all it's principles right here with this new fee introduction, as a global equipment trader and a major consignor to rbros auctions globally this has greatly effected my trading strategy ..pure market value will never be reached and it is a disservice to rbros buyers and consignors both. The absolute policy rbros so proudly heralds has gone , it used to be what you bid you pay absolute and final no more no less!! These announcements are all over rbros literature and was the foundation on what the great company was built on.. This is again a fee to boost short term profit and stock value at cost to the customer , I think it will have a hugely negative medium term and long term effect On rbros...young auction companies such as euro auctions will benefit greatly from Rbros short sightedness here, I hear they are coming stateside and into Australia very soon, I wish them good luck
buyer premiums suck
the way i see it machines should bring 10% less but the end cost about the same. It will catch out a few wood ducks that caught up in the moment
In Alberta here, RBA has too much of the market. Their reps are cocky and their service needs help. This company has definitely lost the mantra they were built on. I rarely buy from them anymore. Too much headache and there are friendlier auction yards out there. A lot of the other RBA yards are friendlier than Alberta's.
Provide better service? and a host of other excuses, they are already getting paid by the seller a hefty premium. They will charge what the public will pay and they have that figured out, they have built a multi billion dollar industry and getting even bigger by charging what they think others will pay. I'm glad iron planet and others have came into the market as well, it gives RB a challenge otherwise they'd go even crazier on prices, it might take decades but the day is coming where the buyer and seller will both pay equal amounts and its not the percentages already mentioned, it'll be a lot higher for each. The day is coming where the auction yard will get almost more than the person selling the machine. The 10% buyers premium for lots under 2500 is saying they don't want to mess with anything under 2500 bucks, they want to sell those 200k machines in the same time as a 2k piece and the commission is a lot more for selling a 200k machine. Its simple maximize profits and minimize time spend doing it, same as any other business, they've just taken it to a higher level and globally is all and figured out how to get both ends to pay for one service. Better service, thats a line of BS, they just want more money for the same or less service, they are already being paid for whatever service they provide, more money isn't going to improve anything but their bottom line.
The buyer's premium is just another ruse to bring in stock to sell. The idea is to charge the seller less as an inducement to bring the machine to RB. Almost all the auctions are doing it now. As noted by Randy88, it is nothing more than finding more people who will put money in the RB bank. What hasn't been brought up is things like yard fees and other add on costs being assessed. One has to wonder when Ritchie will start setting hidden reserves? Anymore, if you are liquidating assets and have time you need to look at all the options. Most dealers now are offering attractive consignment programs. There are lots of curb stone dealers and the auctioneers other than RB. If you are looking to purchase there are plenty of other companies that sell iron. All it takes is a little home work up front. Also keep in mind that when an auctioneer says sold at auction, it doesn't always happen.
Every one is in the auction business these days. Even Cat has their own auction service.
R.B. gobbled up all the older well known acutioneers or forced them out. I remember Miller & Miller, Max Rouse & Sons, Forke Bros, Alex Lion to name a few. Now it's like you only have one choice, R.B. With all the sites they have, they have to put together a sale 4 times a year at each location, I have seen some pretty dismal sales recently. They have ran out of big spreads to sell in Socal. 10% from buyer, 10% from seller, yard fees, painting, trucking.. does not leave much return. Sometimes the prices are so low, you are bidding against scrap dealers ( and that sucks, lot's of nice machines lost forever)
When will they start setting hidden reserves, about six years ago I'd say, I was to a sale and tried to buy a dozer and a semi, both went for way more than they were worth, which kind of caught me off guard, but since I'd done my homework I had the serial numbers of both units, those same two units sold over 9 times between the two over the next two years on RB auctions throughout the country, that is unless both manufacturers made identical models with the same serial number and model number on numerous models? No buybacks, yea about that, maybe they call it, "no let goes" or "we'll try again" or "maybe more next time" instead of absolute sale, which it might be but they never claim "when" the absolute sale is going to be though do they? When I asked about the same machine going through multiple sales I was told the buyer didn't come through with payment, nine different times? As for other auctions, the more money one company makes in any business the more likely there'll be others follow suit and do the same thing, especially if people figure out where they are the most vulnerable and are lacking in services. Internet auctions and small time sales sites are cropping up, more every day and there will be still more to come, all they need is equipment to sell and for purple wave they get it by making the buyer pay the fee's, not the seller, others have lower than rb commissions or inspections or internet auctions or long term internet bidding, days instead of minutes, and a host of other ideas that people want or are handy to use. What goes around comes around and everything has its day, some have more days than others but none remain on top forever, nor ever will, someone always has something more to offer for less and its always harder to keep market share than take it away from someone else, the larger the scale the harder this is to achieve, keep market share that is.
The concern should be for the sellers, in my opinion. With all the data available on this iron, buyers are going to do their homework to figure value. Total money spent at the end of the day is what the buyer is looking at, including buyer fee in that price. So if the machine is worth $100,000 auction value, the buyers will go to say $90,000. This net's the seller less money at the end of the day, which already sucks with all the fee's. As previously mentioned, this is just my opinion.
Ritchie Bros Auctioneers - Too big to fail: I hope not.
When the bidder becomes accustomed to the buyer premium being in place, he will adjust his maximum bid lower to account for this. Net cost of the purchase is the only thing that matters whether it is made up of seller fees, auction fees, taxes, transportation costs, or buyers fees whatever is left over is the bid for the machine. Unfortunately it is the middle man, who didn't take any risk, made no investment and didn't manufacture, purchase or maintain the equipment who stands to gain more profit for his service at the expense of his customers.
Talked to the Ritchie Bros here locally this week as they have a utility truck I'm interested in coming up. On a $20K bidding limit you put up a refundable 25% or $5K and 2.5% buyer fee plus local sales tax. If I were to win with a $9K bid it really costs almost $10K
I think it is refreshing to read some of yr comments, RBros I think has introduced this charge as they as I foresee a worldwide shortage of used iron, some of there sales are empty and have none of the sexy items one could regularly find at an rbros auction..The North East auction for example has completely deteriorated, full of golf carts and SUVs..no quality iron whatsoever..I think they have lost touch with the industry and the people within it....There local representatives are cocky, arrogant and ignorant..I think there is a danger that they could fail in the long term as they have totally left their traditional values behind and are becoming increasingly difficult to deal with..The only way they will survive is buying there own equipment ..
Is there a shortage of good items to list on the sales or a shortage of people with those items willing to deal with them, there is a difference.
This is just another slap in the face to this small contractor who has has gone to more of their auctions in the past 20+ years than I can remember. First it was the 10% "small lot handling fee" on items under $2500, next it was internet bidding (which is not so bad in itself, except for the fact that it was the end of the fair and unreserved auction that they boast of. Now you have no idea who you are bidding against. With Ritchie owning so much of the equipment being sold at their auctions it is hard to imagine that they are not playing some games.), next was the end of accepting my business checks as they had for the previous 20 years (they will give me a $200k bidding limit to bid on the internet but won't take a $500 check so that I don't have to make a second trip to the auction to pay for the treasure I just bought), next was the timed auction (I take my under $2500 item there to sell, they charge me 25%, the buyer 10%, and all they do is put a sticker on it and list it in their catalog and on the internet. No auctioneer, so no trying to get the maximum out of it. If they have computer trouble and the kiosks don't work right and people have trouble posting their bids, as happened here a few auctions ago, you are just out of luck.), finally we have the new 2.5% buyers fee. It used to be that if you put in the effort to go to the auction, touch, listen, sniff, and run the machines that you might bid on; you had the chance of getting a deal on something. Now, every time I go to the auction I am beat out by the internet bidder who is buying on the basis of 8 pictures of paint and decals, and one picture each of the seat and hour meter. Up until now the onsite bidder had a slight advantage in that the internet bidder had to pay 2.5%. Not anymore. I think the reason for all the above is as follows: 1. money 2. money 3. money and the fact that RBA has gone from being your hometown auction yard to a global mega corporation. The focus now is maximizing profit while minimizing costs (service). I think part of the reason for the new fee structure is to speed the transition to much more of an internet auction (can you say Iron Planet). Over the years I have bought more equipment, trucks, trailers, and misc stuff at their auctions than I can remember. When it was time to sell something, off to Ritchie's it went. I knew that I may not get top dollar, but I appreciated the deals I purchased there and figured it was just part of the game, plus there was a relationship. Not anymore
I used to attend nearly all the RB auctions in the area. I was bent over the 10% for lots under $2500. This about seals it. If there is something I really want I will still go, but I don't go to near the sales I used to. RB's internet arrangement has never worked for me. Iron Planet is much easier, and more effective.
brianbulldozer, first off welcome to the site, second off excellent way to sum it all up, I'd have to agree 100%, you hit the nail on the head.
Call bidadoo. RB is "buyer beware". They sell the equipment owners no longer want, has issues out the wazoo and they don't want disclosed. If you can't inspect it yourself, your screwed. bidadoo has verified inspections, No buyers premium, sell equipment from it's current location (no transport costs), full service re-marketing company, 100% guarantee on all equipment sold and have a sale every Tuesday.
May be a new record for bringing up an old thread. bilpat2 must work for bidadoo. I live near RB's highest selling site in N. America. To say the equipment is stuff the owner no longer wants and has issues out the wazoo is just plain wrong! I've seen brand new Cat equipment sold with full factory warranties. Everything can be inspected. RB's has built up such a large following of customers they are generally considered the best place to find the equipment you're looking for if you can't afford new or dealers prices. It's also why they attract the most sellers. They sell the gambit from brand new to worn out and everything in-between. On used equipment it's always a gamble even if the equipment has had a complete and thorough inspection no matter where it's bought. If a $10,000+ engine grenades a month and half after a full inspection, I'd bet getting it covered 100% including the labour to change it would be an exercise in futility for the buyer.