Auction Fever

A farm equipment auction is an event that most people have never had the pleasure of experiencing. These events tend to be for a small niche of people and the number is only getting smaller. There just are not many people who need a tractor, disk, fuel wagon or aluminum sprinkler pipe to get their job done.

Work boots, jeans, plaid shirts, denim jackets and a baseball cap are a pretty accurate description of the folks there. The boots and jeans never vary much, but the hats and jackets are where farmers really show their colors. These prime locations are used to represent the logo of a preferred tractor, the company that buys their product, the bank that gave them the loan or a favorite NASCAR driver.

I fit right in with my old patched up Wrangler jeans, my Sac Valley Farm Credit hat (which I saw on a few other fellows) and the standard issue NEXTEL ringing phone in my pocket, which I reached for several times before realizing it was someone else’s phone ringing my ring. I need to download a new tune.

The thought alone of bidding on a piece of equipment makes my heart thump in my chest. Your body realizes that the extra flow of blood is needed in an effort to keep brain and muscle activity at their peak, tracking just how much the auctioneer is singing the price to, while preventing any bodily movements that would result in a bid.

My brother once bought a land plane on accident. A land-plane is an implement about 40 feet long and 16 feet wide that is pulled behind a tractor to level a field after it has been disked.

It may seem like an impossible mistake to make but in the heat of the moment he had his eyes on this tractor that everyone was surrounding and the price was great – by the time the dust settled he realized the price was so great because everyone else was bidding on the land plane sitting next to the tractor – whoops. Fortunately, we only owned the land plane for a few hours – just long enough to track down the other guy who was bidding on it; he ended up with a pretty good deal.

Experience is the only thing that will safely get you through an auction. The most important rule is to preview the equipment and make a rational decision about what you really need and how much you are willing to pay for it. The Golden Rule is to not pass up your previously decided price when you become emotionally involved in the bidding process.

There is something about the crowd, the bidding, the excitement of maybe getting a great deal, coupled with really wanting whatever is out there that makes auctions exciting. Some people are addicted to it – Auction Junkies.

The auction company earns a percentage of the total sales, so it is in their best interest to sell the item for as much money as possible. The auctioneer has several assistants in the crowd who shout out bids as they see them.

There psychology involved with outbidding everyone while staying within your budget. Generally there are only a few people in the crowd bidding on any particular item. The auctioneer is sing the price and a subtle movement will indicate you are willing to pay that price. If someone else makes a bid then the price gets raised again and all eyes go back to you to see if you are willing to pay more than the other guy.

It sounds simple but it is a very intense situation. There is something that you want for sale, you have already indicated you will pay some amount for it. Someone else just said they will pay more, the auctioneer has moved up the price and his assistant has is arm pointed at you - eyes locked onto your soul trying to will you to pay more, while watching for so much as a twitch from you before shouting your new high bid to the crowd. This situation can last for up to a minute, which feels like an eternity, if you never budge, eventually the auctioneer announces the item sold to the other guy. If you do take the bid the attention gets shifted to the other guy – if he doesn’t take the bid the item is yours. It is kind of like playing chicken, with money.

In this situation you need to realize that this is real money and winning this little battle might feel good until you have to actually cut a check for this amount. The other fact to realize is that the sooner you get the other guy to stop bidding the sooner the price of the item stops increasing.

If someone bids and you take a long time to decide to place another bid, this may indicate to the other person that you are right at your limit and if they bid one more time they will get the item. However, if the other person bids and you immediately come back with another bid, it may indicate to them that you are not even close to your max limit and they may as well stop bidding now because you are going to out bid them eventually. You want to make everyone think that you will stop at nothing to end up with this item.

My preferred method for handling the auction situation is to have a number in your head of how much you are willing to pay for the item before the bidding starts. Let someone else make the first bid (which is generally about half of what is eventually paid for the item) then aggressively bid until you get the item or you get to your limit – at which point you remind yourself of the Golden Rule and you let the other guy pay more for it because your previously made a rational decision that it is not worth that much to you.

An interesting side note is the fact that at charity auctions free alcohol is made available to the buyers – bidding under the influence dampens your ability to make rational decisions in the heat of the moment.

If you ever have a chance to attend a farm equipment or livestock auction I suggests taking it. You will not be disappointed.