Who says you need a brand-new piece of heavy equipment for your upcoming construction job? Used equipment is just as productive new equipment, and it is much easier on your wallet. You can purchase or finance used heavy equipment and invest the extra money into other areas of your construction business, or save it for the future.
When you are ready to buy used heavy equipment, you have several options to choose from. These include construction equipment dealers, equipment websites, and auction houses, the latter of which is the focus of this Balboa Capital blog article. Auctions are a great way to obtain top-quality heavy equipment for far less that its retail and/or fair market value. We think you will find this guide to heavy equipment auctions to be quite helpful. It explains what they are, how they work, and more.
What is a heavy equipment auction?
A heavy equipment auction functions in the same manner as the traditional auction process that we are all familiar with. An independent contractor or a construction business offers a public sale of a piece of heavy equipment to the highest bidder. An online or brick-and-mortar auction house facilitates the transaction and takes a percentage of the final sale.
Before a heavy equipment auction takes place, you are typically given quite a bit of information. In addition to the equipment make, model and description, you will see its identification number, serial number, maintenance history, number of operating hours, and inspection report. Some heavy equipment auction houses also list the buyer and seller history and fluid levels, among others. Having access to this information instills confidence and can help you make an informed decision.
What types of auctions are there?
Prior to the Internet, you would have to visit an auction house in person to bid on heavy equipment. Today, there are a number of online auction houses to choose from that list all types of heavy equipment. The top online auction houses offer live on-site and online bidding, and some of them have in-person auction sites in small towns and big cities throughout the United States.
Moreover, the leading online auctioneers have robust websites that are regularly updated with new listings, and that let you search for specific types of heavy construction equipment by region, price, year, and more. In many cases, you can even inspect and test the equipment prior to placing a bid. The majority of auctioneers post auction calendars on their websites, and some of them offer auction email alerts.
If you want to participate in an auction, do your research and become familiar with the process and policies of the auctioneer you select. You will need to understand the bidding choices (e.g., onsite, online or proxy), the bidding methods (e.g., reserved price, unreserved price), and the equipment delivery options.
How do I start bidding?
In order to place a bid on a piece of heavy equipment, you will first need to register with the auctioneer. This can be done online fairly quickly. Basic information such as your name, business name (if applicable) telephone number, address, and driver’s license number are required. Depending on the auctioneer you choose, you might need to provide a refundable deposit equivalent to a specific percentage of your bidding limit.
Once your registration is approved, you will be given a bidder card with a number that can be used at an in-person auction. If you opt to bid online, you will use the number that is associated with your personal account.
My bid won, now what?
Congratulations, you were the highest bidder on a piece of heavy equipment. The next step is to pay the bid price so you can take ownership of the equipment right away. The auctioneer may collect your payment through a wire transfer, credit card or an online payment app/service. Some auctioneers offer in-house financing and/or work with direct lenders that offer heavy equipment financing.
What about shipping?
The last order of business is to have your heavy equipment shipped. In most cases, the auctioneer will provide you with the carrier company and tracking number once you make your payment and complete all of the necessary paperwork. When picking up the equipment at the auction site, the carrier company’s driver will need to present a proof-of-payment receipt.
If possible, get the carrier company’s contact information so you can provide them with the receipt and any special instructions that the driver should know about. This can help ensure a smooth and trouble-free delivery of your heavy equipment.