Buying at a farm machinery auction is very different to buying through dealerships and private sellers. It can be daunting, especially for first-timers.
While new is preferable for many, there is plenty of used equipment going for a fraction of the cost—especially if you know what to look for. Before we delve in, let’s go through the auction process.
So, how does the auction actually work? You’ll find it goes something like this:
- Search—find the item you’re looking for
- Inspect— remember, everything sells “as is”
- Register—online or at the live auction
- Bid—raise your hand (or paddle) to place a bid. Sitting toward the front will ensure your bid isn’t missed by auctioneers
- Purchase—if you were the highest bidder, a staff member will approach you to go through payment information
- Pick-up—bring the invoice and identification to pick up your item. Information on pick-up times and dates will be available on the day.
Now you know how the process works, here are 10 things to know for buying at a farm machinery auction:
- Consider different farm machinery auction types
- Understand market trends
- Buy the right age & brand machinery
- Consider diesel powered
- Have clear intentions
- View machinery before auction day
- Check warranty & service history
- Try before you bid
- Know your deal breakers
- Maintain your farm machinery
1. Consider Different Farm Machinery Auction Types
There’s no ‘one size fits all’ farm machinery auction, so it’s likely (to get what you want) you may have to attend several different types of auctions. These auction types include:
- On-site farm auctions
- Wholesale auctions
- On-site dealer auctions
- Online auctions
On-site and live auctions are great for many reasons, but they come with high emotions that can spur bidding wars and result in higher prices. So, it’s best to consider which auction type is best for you.
Generally, wholesale auctions are not open to the public as they are reserved for dealers and recognised third-party sellers. Dealer auctions however, can be open to the public and may be done at wholesale prices, but they may also require a dealer license. Online auctions, on the other hand, are a great way to access the market and bid without needing to leave your home.
Whichever auction type you choose, you’ll find that all are great buying opportunities that could help you save on popular machines, such as tractors and harvesters.
2. Understand Market Trends
With the harsh weather conditions experienced by Australian farmers, it’s important to invest wisely in your farming equipment. This means taking note of how the seasons are tracking and how much demand there is for particular machinery.
Off-season buying can help save big on machinery at auction. This can also set you up for a positive return on investment, as you can use the machine the following season, which reduces downtime.
Tractors are one of the most popular machines in demand at auction. Find tractors for auction here.
3. Buy the Right Aged & Brand Machinery
It’s important to invest in the right aged machinery to ensure you don’t buy an asset that could turn into a loss through depreciation. A general rule is to purchase machines that are between 3 and 8 years old. These hold their value better than models that are 10+ years old—which is great for resale.
Another aspect of value retention is the manufacturer. As mentioned in our EquipmentWatch Awards article, Caterpillar, Deere, Case and Komatsu are the top brands holding their value. Of course, this can differ depending on the condition and the model, so just make sure you know what you’re getting!
4. Consider Diesel Powered
When purchasing used farm equipment, diesel engines are considered hot property. A diesel engine is more efficient, powerful and cost-effective for long-term use. They’re rugged, reliable and often come with a longer life-span than the alternative. Tech advancements mean that farms can be more productive using diesel powered equipment.
5. Have Clear Intentions
Farm machinery auctions are high-energy, so it’s easy to get overexcited. So, before you attend an auction make sure you have clear intentions. If you go in knowing what you’re going to buy (and how much you’re willing to spend), it’s much easier to keep your focus and remove your emotions from the equation.
We recommend getting a leg up and doing your research beforehand. Make sure you know the current second-hand market value for the farm machinery you’re bidding on. This will help you set a limit on what is reasonable and what isn’t—keeping you level headed throughout the event.
6. View Machinery Before Auction Day
When it comes to viewing machinery there is a big difference between looking online and seeing the equipment in person. Remember: Photos only show you what the seller wants you to see.
So, it always pays to arrange a viewing before auction day (if possible). This will give you time to walk around and check out the condition of the interior and exterior components with your own eyes.
If you’re viewing the machine with the auctioneer, you can also gain some insight into how much interest they’ve received so far.
7. Check Warranty & Service History
Warranty and servicing history are 2 vital components when buying second-hand farming machinery. You need to know what you’re buying. Pretty is great, but you need your equipment to perform. So, always check the service or log book history of the machine at auction.
If the machine has exceeded traditional usage ranges, make sure you enquire about upgraded parts and fittings. Mechanical components left after the recommended usage range may be worn out, or may wear out faster than expected.
8. Try Before You Bid
Just as you would with a car, see if you can test the farm machinery before auction. This will give you a chance to see how the machinery handles and what kind of operational condition it’s in.
You may also be able to speak to the owner to get an idea of how hard it’s been worked. It might even be beneficial to simply ask “why” the machinery is being put up for auction.
9. Know Your Deal Breakers
Knowing when to back away from a machine will help save you from buying a lemon. A few common deal breakers, include:
- Structural problems
- Major component issues
- Out-of-business manufacturers
Whether the machine has rust or cracks, the engine is hard to start, or the machine needs a new part and the manufacturer is out of business, it’s important to know when to walk away.
10. Maintain Your Farm Machinery
So, you’ve purchased equipment from the farm machinery auction. Now what? First, you’ll need to arrange a pick-up date and time with the auction house. Generally, this is organised at the point of sale.
Once you’re home with your machinery, ensure you maintain it with the appropriate documentation, to make future resale easier. Regular maintenance will make your purchase worthwhile and ensures the machinery lasts for years to come.
What’s your top tip for buying at a farm machinery auction? Let us know in the comments below, or take a look at farm machinery for auction here.