Dealer auto auctions are one of the top ways car dealers and auto salvage companies purchase cars for their work. These cars are from various sellers, and at an auction buyers can place bids to get the cars they want. If you are interested in learning more about auto auctions, keep reading to learn some common myths and if there’s any truth to them.
Myth #1: Dealer auto auctions aren’t that popular. False. Auctions are actually a multi billion dollar industry and are one of the primary ways that used car dealers obtain cars to sell. Another group that takes advantage of auto auctions is the auto salvage industry, because they purchase wrecked cars to dismantle them and resell the parts. Online auto auctions are a sizeable and growing segment of the auction industry, and this is a great way to bid at auctions if you can’t be there.
Myth #2: Auctions are an expensive way to buy products. False. The overall cost of auctions is actually lower than the traditional retail form of buying and selling goods. Companies that run auto auctions save money on overhead costs like utilities and they don’t have to pay for warehouses to store their cars. This savings is passed onto buyers and they benefit from lower prices when purchasing goods.
Myth #3: Dealer auto auctions don’t utilize advanced technology. False. One of the most important advancements in auto auctions in the past decade has been the development of car auction software that allows buyers to bid for cars online. Simulcast broadcasting provides a real time stream over the internet of a physical auction. The “smartauctions” place information about the auction online for up to a week prior to the live event, which allows bidders to preview items and make proxy bids online.
Myth #4: Online auto auctions aren’t as good as being there in person. False. Simulcast auctions are actually the favored form of auction because they can bring together more buyers and sellers. When a company’s physical presence isn’t required, a whole new market opens up and more cars can be bought and sold. Simulcast auctions combine the advantages of live and online auctions. They often have increased revenues because there are more participants. This means a wider selection for bidders to choose from, and sellers have access to more buyers.
Myth #5: Most of the cars come from insurance companies. False. Auction items come from a wide variety of sources, including bankruptcies, government surpluses, business liquidations, law enforcement confiscations, estate sales, landlord liquidations and more. Insurance auto auctions are popular, but they aren’t the only sources of cars for people looking to place bids on used or wrecked autos. No matter who the vendor is, they are approved by the auction company and buyers can trust that they are honest and can feel confident that they are purchasing a solid product.
Myth #6: Dealer auto auctions don’t reach a large audience. False. Simulcast auto auctions have helped to change this in recent years, and they promote the vendor brand to a much wider audience. This enhances buyer loyalty and improves they buying experience for everyone. Simulcasts also increase buyer participation in auctions because they allow people to place anonymous bids on cars to protect their privacy. Attendance at simulcast auctions is high, because participates include both people who are physically in attendance as well as those people placing bids online.