Selling Used Equipment They Easy WayWritten By: Mary Sedor
Article Date: 06-01-2007
Copyright(C) 2008 Associated Equipment Distributors. All Rights Reserved.
Online auctions specialize in used, distressed and end-of-life equipment.
With extensive backgrounds in equipment sales and industrial equipment, CapitalAssetSale's founders created the company to address the difficulty some dealers have selling used, surplus, distressed and end-of-life equipment.
"We leverage the Internet and its broad reach to hundreds of thousands of potential buyers worldwide," says Dan Parsley, president and CEO of CapitalAssetSale.
The company's staff has a thorough knowledge of heavy equipment, commercial vehicles, fleet equipment, specialty equipment and other industry products, which allows them to know which buyers to approach about each piece of equipment.
At 40,000 feet, the seven-year-old company looks like eBay, but on closer inspection, the company says you'll find significant differences.
"Most companies focus attention on the front-end procurement process rather than on the back end," says Parsley. "By focusing on the used, damaged, distressed, and end-of-life equipment, we reach a much larger base of potential buyers and create more competition through a standardized auction platform."
Sellers are allowed to sell equipment through CapitalAssetSale auctions that is "as is" and where it is.
"A lot of auction companies take the equipment to a parking lot or their auction yards," says Parsley. "There is expense involved in that - storage, risk, and cost - plus the seller has to wait until the next scheduled auction."
According to Parsley, another advantage of their auctions is that unlike with other some online auction sites where you wait and hope buyers are looking for your product, Capital-AssetSale accesses its database of equipment buyers worldwide to match buyers with your equipment.
"We're proactive in how we drive buyers to auction," he says. "We have nearly 100,000 buyer registrations in 140 countries."
When buyers are registered, they specify the types of equipment they're interested in and the company contacts those buyers when that type of equipment comes up for auction.
The company's staff of "Market Makers" are experts in both the equipment being auctioned and the buyers.
"Our Market Makers know who to drive demand," says Parsley. "We start with our registered buyers but we're constantly growing our buyer base."
Interested buyers anywhere in the world can bid through a simple, straightforward and efficient method designed to achieve a competitive price.
"Typically there are 160 to 200 bids per auction," says Parsley. "That's a good indication that we're reaching a lot of interested buyers who are participating through our marketplace."
Essentially, registered buyers come in four categories:
CapitalAssetSale auctions feature a dynamic close. In other online auctions, a deadline is set for the auction and the highest bidder at the moment the auction closes wins the auction. At CapitalAssetSale auctions, if there is a change in the first place bidder within the last five minutes of the auction, the auction is extended five minutes.
- Buyers who are interested in refurbishing equipment. They buy an end-of-life asset, refurbish it and then sell it.
- Buyers in the import/export business who purchase equipment and resell it into the export market.
- Buyers who purchase used equipment for their rental fleets
- "Part out" buyers who purchase end-of-life products, tear them down and sell them as parts.
"It models the ‘yell' auction," says Parsley. "If in the last five minutes the highest bidder is at $25,000 and another bidder comes in at $27,000, the auction close is extended five minutes."
The auction close is continuously reset until there is a five-minute period with no bidding.
"This allows the auction to continue as long as there is competition for the sale," says Parsley, "and results in the most competitive price for the item."
In addition, CapitalAssetSale auctions make it easy for buyers to participage by ending at night and on weekends.
"We recognize a lot of our buyers are entrepreneurs," says Parsley. "They're busy, and they do a lot of their bidding at night and over the weekends. We try to accommodate that by extending auctions three to five days to allow bidders to look at the information and consider their bids."
CapitalAssetSale's client services managers walk dealers through the information needed to list equipment for auction. The dealer need only identify where the asset sits, and provide pictures and a description; the company will do the rest.
Pertinent information, such as pictures, descriptions and maintenance records, are emailed to the client services manager, who creates the listing. If dealers don't have the necessary information available,
CapitalAssetSale will research the product and collect the information for a fee.
Best of all, there are no listing fees on Capital-AssetSale's online marketplace. The company operates on a no-sell/no-pay system. CapitalAssetSale charges a commission based on the sale price. Standard fees start at 12.5 percent, decreasing as the transaction size increases.
CapitalAsset-Sale is a great way to get rid of "fence line" assets, says Parsley.
"Any dealer at any given time has stuff on their lot we call fence line assets - they're out there collecting weeds," says Parsley. "We can make a market for them."
According to Parsley, knowing equipment can be easily and profitably moved at their auctions allows dealers to take trade-ins with confidence and focus their staffs on selling their higher-value branded equipment.
"We have a much higher recovery than traditional sales methods for selling used or surplus assets," he says. "And our average cycle time from auction start to when we are sending the seller the money is 18 to 20 days."
New AED Members
CapitalAssetSale recently joined Associated Equipment Distributors.
"The value of the service we provide is becoming increasingly clear to us," says Parsley. "Based on our conversations with dealers, there is definitely a need for this service.
"Certainly there are companies out there that have been providing auction services to dealers for years. The difference is that those auction companies take a different approach."
According to Parsley, being an AED member will help the company reach the dealers who are most likely to benefit from this type of service.
"We realize we're relatively new to equipment dealers," says Parsley, "but I think being an AED member is a fantastic way to get the word out and our membership provides us with the opportunity to meet these dealers, show them our capabilities and grow our business by servicing that segment."
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