Online Auctions

SAIA Head of Transformation

GET SET FOR ONLINE AUCTIONS

Covid-19 has presented the auctioneering industry with an unexpected opportunity to reach new audiences across the country and the globe via cleverly developed online auctioneering platforms.

Rather than being limited to the confines of a sensible geographical area that buyers may travel to attend traditional auctions, the online platforms allow auctioneers to reach out and sell items to any interested bidders no matter where they are. Thanks to the simultaneous proliferation of online shopping portals, couriers and freight carriers have ready-to-use solutions to deliver almost any asset to any destination on the map.

However, auctioneers that want to make use of online auction programs need to be realistic about the type and size of auctions that they are set up for and choose wisely when it comes to selecting an appropriate online platform that suits their needs, abilities, and budget. The frequency of online auctions may also dictate whether the users buy software outright or consider one of the pay-as-you-go options.

OVERSEAS SUPPLIERS

Tech savvy auctioneer and Head of Transformation on the South Africa Institute of Auctioneers (SAIA) board, Kwanele Boltina, says finding and choosing a program should be a priority for companies whose market is unreachable or reduced via traditional means during lockdown.

“Unfortunately, 80-90% of the larger programs available so far are from overseas suppliers which means that medium and larger-sized auctioneers will have to procure these in foreign currencies which does not favour the Rand at present. They are also setup especially for foreign markets and do need some modification to cater for our own market’s requirements.

“However, in my experience it has been worth the investment and during lockdown we grew our online client base from just one company, to nine and growing. Numbers attending these auctions have also grown exponentially and, in the months, following the initial lockdown we have more than covered our investment.

“I would say that before lockdown it was seen by many in the industry as a luxury. Now it is seen as a necessity and everyone from banks to Government and others wants their auctions to be held online to ensure they get the biggest audiences and best prices possible. Rather than waiting for someone else to start auctions in your territory, I would say it is worth investing in a program that takes your auctions to the online market,” says Kwanele.

MEMBER NETWORKING

He advises auctioneers to shop around and speak to others in the association to find out platforms that may work for them. To start with some smaller-scale auctioneers may want to test-the-waters and use free online meeting platforms such as Zoom or other similar application in order to become familiar with the medium.

However, they will probably need to graduate to a custom-built program with dedicated functionality that logs and records users, locks bids and manages the auctions safely and securely. Programs like Bidlogix, Auction Mobility, BidJS, Vortex and Flexi-Auction all have their place in the market and can be used as a starting point to investigate and compare solutions. These programs costs vary according to the features available and range from a few thousand to hundreds of thousands of Rands.

They also incur associated costs such as the establishment of dedicated data line with enough bandwidth to handle large auctions, IT infrastructure, cameras and operators or staff to document auctions and upload information, pictures, and videos for viewing purposes.

HIDDEN COSTS

In addition, training may be required to familiarise staff and auctioneers on the use of the software, as well as the processes and procedures that need to be put in place to ensure safe, efficient and legitimate auctions can be held online. The auctions should also be presented in a transparent manner with at least some entertainment value to ensure audiences stay connected and involved.

If the auctioneers can find the right formula the rewards are many and expands the reach of the auction, attracts new buyers and ensures a safer and more controlled environment where the only time people are required onsite is to view assets and collect goods. Auctions can also be arranged more quickly and negate the need for travel to document items for auction as they can simply be uploaded by a remote user.

“However, the rise of online auctions does not mean that it will entirely replace traditional auctions as some auctions are better suited to live onsite environments. It also cannot replace the excitement factor, the rush buyers and sellers get when bidding, the feel and going with your gut to get the right prices. What it does do for the industry though is give everyone more choices,” Kwanele concludes.