How the Middle East equipment auction industry is forging new buyer markets

By Eduard Faig, Regional Sales Manager, Ritchie Bros. Middle East

2020 was a challenging year for many business sectors, and the equipment auction industry was no exception, with several major changes occurring. The biggest shift in the way we work was how online auctions were catapulted forward as the most effective solution to COVID-19 pandemic lockdowns. Of course, the pandemic made it difficult for even local auction regulars to physically attend traditional, live auction venues at times, and it also became more difficult for overseas buyers to travel across international borders to attend in person. These challenges have further reinforced the effectiveness of online auctions to address such problems.

Although the industry trend towards online auctions had already commenced in early 2020, many equipment auctioneers made the change to an entirely-online auction format during the last year, which has been delivering significant benefits to both consignors and buyers.With the introduction of easy-to-use online auction websites, buyers can now join online auctions from anywhere in the world. Wherever their location, buyers can access online inventory lists and view the hundreds of auction assets listed there.

The key result of these customer-focused, online innovations has been buyer growth from remote regions.  It has also served to open new country markets previously not possible with traditional, live auctions.

Reaching more buyers in remote locations 

Take the most recent Ritchie Bros. December Dubai auction as an example: online bidders from 83 countries participated, establishing a new trend for overseas buyer growth. It was also notable that more than 40% of consigned equipment in the auction was purchased by bidders from countries outside the UAE, even though the company’s auction yard is located in Dubai.

Growth in Egypt and Africa-based buyers

So, in which countries were these new buyers located? And what conclusions can we draw?

Let’s take a deeper dive into the recent December Dubai online auction statistics. Of over 1,450 pieces of equipment, trucks, and other items sold, significant numbers were purchased by buyers in Ghana, Nigeria, Egypt, and South Africa using the Online Timed Auction system.

In total, more than 1,200 online bidders participated in the auction. It was refreshing to see customers embracing the technology and confidently buying and selling at online auctions throughout this challenging period, even in remote regions throughout Egypt and West Africa, as well as South Africa.

Essentially, online auctions have helped consignors increase their global reach as more potential buyers, regardless of location, can view photos and details of their inventory and effortlessly place bids. 

From a buyer’s point of view, the online auction system allows more time to place bids, plus they receive status notifications on their devices and have time to respond and adjust bids when a lot closes.

Reducing the risks of buying online

Like at traditional live auctions, at most online auctions, inventory is still sold ’as is, where is', so it’s always crucial for buyers to conduct their research before the auction. comprehensive inventory listings on the website contain numerous photos and detailed and verified information on each asset. Interested bidders or their representatives can also visit auction sites on set days in advance to view items in person. These options help to instil customer confidence in the overall online auction experience.

Shipping services becoming more popular

With COVID-19 pandemic lockdowns, international shipping services are becoming more critical. Comprehensive transportation solutions are provided where buyers do not need to travel to the auction site, as the auction house can handle all international shipping formalities on the buyers' behalf. These ancillary services make it more convenient for online buyers, especially those located overseas, which further contributes to widespread online auction adoption.

What to expect in 2021?

During 2021, the auction industry faces challenges on how to increase online consignor and buyer numbers while helping new customers better understand the online auction system from the outset. It’s essential for users to feel immediately comfortable with the online format and functionality regardless of where they are located in the world. Online tutorials will play an important role in addressing this need.

It’s also vital for web portals and customer interfaces to be continually updated to meet changing client needs. But that’s not enough on its own.

Customers always appreciate the human touch.

It’s essential to back this up with a team of representatives who can respond to customers inquiries and provide ongoing, personalized support.

In this regard, Ritchie Bros. Middle East has committed to building upon its team of Territory Managers to help clients through the online auction experience and provide pre and post-auction support. With a Territory Manager assigned to each country, this kind of bespoke service is really well received by clients and is still essential in this increasingly digital world.

Combining personalized service with a world-class online auction experience will be the key to success in 2021. After all, all online auction businesses' ultimate objective is customer satisfaction and help to both consignors and buyers efficiently meet their asset and fleet management needs.

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