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Ritchie Bros. Auctioneers

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Ritchie Bros. Auctioneers (Ritchie Bros.) is the world’s largest industrial auctioneer, selling more equipment to on-site and online bidders than any other company in the world[1]. The company has over 110 locations in 25 countries, including more than 40 auction sites worldwide. Ritchie Bros. sells, through unreserved public auctions, a broad range of used and unused industrial assets, including equipment, trucks and other assets utilized in the construction, transportation, agricultural, material handling, mining, forestry, petroleum, and marine industries.

Ritchie Bros. is a public company. Its common shares are traded on the New York and Toronto stock exchanges under the ticker symbol RBA.[2]

Contents

History

The Ritchie Brothers

The OK Used Furniture Store (Kelowna, B.C.)
Ritchie Bros. Auctioneers was established in Kelowna, B.C., Canada. The three Ritchie brothers—Ken, John and Dave Ritchie—took over the OK Used Furniture Store from their father in 1955. They entered the auction business in 1958 when they needed CA$2,000 to pay a bank debt on short notice. A friend suggested they conduct an auction to get rid of some surplus inventory from the furniture store. They conducted their first auction at the Scout Hall in Kelowna in 1958 and discovered a new way of doing business.[3]

Starting with that first auction at the Scout Hall, Ritchie Bros. maintained a strict policy of conducting unreserved auctions—meaning there were no minimum bids and no reserve prices. The brothers also established a policy of not allowing bid-ins or buy backs by the sellers. These policies became important in distinguishing the company from other equipment auctioneers.[4]

The brothers began conducting more regular auctions and in 1958 incorporated Ritchie Bros. Auction Galleries Ltd. to formalize their new business.[5] Ritchie Bros. began selling used equipment in the 1960s. In 1963 Dave Ritchie moved to Vancouver, B.C. and rented an auction site on S.E. Marine Drive. He set up the company’s first equipment auction in Vancouver shortly after.[6]

The Ritchie brothers conducted their first major unreserved industrial auction in Radium Hot Springs, B.C. on June 7, 1963. They sold CA$663,000 of equipment in one day—by far the largest auction in the company’s history.[7]

The success of the Radium Hot Springs auction convinced the brothers that they could make more money auctioning used equipment than selling furniture, so they sold their furniture store in Kelowna and went into the auction business full-time.[8]

Ritchie Bros. Auctioneers established one of the trademarks of its auctions at the Radium Hot Springs auction. It was raining on the day of the auction. Instead of making the bidders walk around in the rain during the auction, they set up the auction under the eaves of a nearby shop and drove the equipment in to be sold piece by piece. The crowd stayed dry and the ramp-and-stage method became a fixture at Ritchie Bros. auctions thereafter.[9]

50 years of Unreserved Industrial Auctions

On June 7, 2013, Ritchie Bros. celebrated 50 years since the company’s first major unreserved industrial auction in Radium Hot Springs, British Columbia. It was at this Radium Hot Springs auction that Ritchie Bros. adopted the ramp-and-stage approach for selling all mobile equipment. This approach involves a staging area —designed as a ramp— located in front of a viewing theater, where bidders sit waiting for mobile equipment to come to “center stage.” Each piece of equipment is numbered and, once it comes to rest at the center of the ramp, the auctioneer begins asking for bids. The crowd of bidders signals their bid increments to roving “bid catchers,” who in turn signal the auctioneer when a bid is made. The auctioneer increases the call price until there are no more bids being placed. At a Ritchie Bros. auction, bids are called until no more are forthcoming in approximately one minute, when the auctioneer calls that the item has been “sold!” to the highest bidder.

The Company has pioneered the ramp-and-stage method and unreserved industrial auctions around the world ever since the auction at Radium Hot Springs on June 7, 1963.

The Early Auction Years

Most of the company’s earliest auctions were held in British Columbia. Ritchie Bros. began expanding into other parts of Canada in the mid-1960s, conducting its first auctions in Alberta (in 1964), the Yukon (1964), Saskatchewan (1965), Manitoba (1968), and other parts of Eastern Canada shortly thereafter.[10]

In 1965 Ken Ritchie left the company to spend more time with his family and the company’s name was changed from Ritchie Bros. Auction Galleries Ltd. to Ritchie Bros. Auctioneers Ltd.[11] Ken established his own auction company but return to work with his brothers in 1968. He stayed with Ritchie Bros. Auctioneers until 1980.[12]

In 1968 Ritchie Bros. Auctioneers held its first auction with gross proceeds in excess of CA$1 million, in Edmonton, Alberta, Canada.[13] Edmonton was also the site of the company’s first permanent auction site (on company-owned land), which was established in 1976. Until then, Ritchie Bros. had been conducting its auctions on leased land.[14]

Expansion in the U.S.

Ritchie Bros. established its first presence outside Canada in 1969 when it became incorporated in Washington State, USA.[15] The company held its first auction outside Canada in 1970, in Beaverton, Oregon, and gradually began expanding throughout the United States.[16]

In 1974 John Ritchie left the company, selling his share of the business to his brother Dave. In 1975, Dave Ritchie—the sole company shareholder—decided to sell partnerships in Ritchie Bros. Auctioneers to some of his key employees: Dick Bartel, C. Russell (“Russ”) Cmolik, Ken Ritchie, and Bill Gronberg.[17] Over the coming years, the partnership expanded to include Bob Carswell, Marvin Chantler, Ed Banser, Roger Rummel, Bob Brawley, Ken Asbury, John Wild, Marty Pope, Mark Clarke, Don Chalmers, Sylvain Touchette, Frank McFadden, and Mike Ritchie.[18] When Ritchie Bros. went public in 1998, Ken Ritchie and Bill Gronberg no longer owned shares in the company.

By 1985 Ritchie Bros. Auctioneers had sold more than US$1 billion dollars of equipment through unreserved auctions. It took only three more years for the company to gross another US$1 billion dollars in sales.[19]

International Expansion

In the late 1980s Ritchie Bros. Auctioneers began to look overseas for further growth opportunities. The company conducted its first auctions outside North America in 1987, in Liverpool, the U.K., and Rotterdam, the Netherlands. The equipment sold at the Liverpool auction had been used to rebuild the Falklands Islands following the war there.[20] Further international expansion followed with the company’s first auctions in Australia (1990), Mexico (1995), the Middle East (1997), Africa (2003), China (2013), and Finland (2013).[21]

In 1991 the company achieved another milestone when it conducted its 1000th unreserved auction. It conducted its 2000th auction in the year 2000.[22]

The Role of Technology

In 1989 Ritchie Bros. became the first industrial auction company to enable remote bidding via video when it broadcast its Edmonton auction live at the Agricom trade show in Edmonton, Alberta, Canada. Video simulcasts were held at trade shows in 1993 and 1995, followed in 1997 by a three-way videoconferenced auction that linked separate auction sites in St. Paul, Minnesota; Kansas City, Missouri; and Clinton, Wisconsin. Equipment was located at all three sites, and interested buyers could bid at any of the sites, which were linked via video.[23]

The company launched its website, rbauction.com, at the ConExpo trade show in Las Vegas, Nevada, USA in 1996. The site featured a searchable database that enabled customers to see all of the equipment being sold in upcoming Ritchie Bros. auctions.[24]

In March 1999 Ritchie Bros. broadcast an auction over the Internet for the first time.[25] In March 2002, Ritchie Bros. introduced its real-time online bidding service.[26]

Going Public

In 1998 the year that Ritchie Bros. went public, the company’s annual gross auction proceeds exceeded US$1 billion for the first time ever.[27] Its common shares were listed on the New York Stock Exchange under the symbol RBA in March 1998, followed by listing on the Toronto Stock Exchange in April 2004.[28]

Network of auction sites

Investing in permanent auction sites has been a company priority since the 1970s. Ritchie Bros. opened its first permanent auction site in Nisku (Edmonton), Alberta, Canada in 1976. Before going public in 1998, the company opened additional permanent auction sites in Vancouver, B.C. (in 1979); Prince George, B.C. (1980); Denver, Colorado (1985) – the first site in the U.S.; Phoenix, Arizona (1987); Toronto, Ontario (1988); Tampa, Florida (1995); Atlanta, Georgia (1996); Minneapolis, Minnesota (1991); Houston, Texas (1993); Fort Worth, Texas (1994); Olympia, Washington (1994); and Halifax, Nova Scotia (1997).[29]

Since then, Ritchie Bros. has added auction sites in eight other countries. Today, the company has 44 auction sites in 13 countries worldwide:[30]

  • USA: Albuquerque, NM; Atlanta, GA; Chicago, IL; Chehalis, WA; Columbus, OH; Denver, CO; Fort Worth, TX; Manchester, NH; Houston, TX; Kansas City, MO; Las Vegas, NV; Los Angeles, CA; Minneapolis, MN; Nashville, TN; North East, MD; Orlando, FL; Phoenix, AZ; Raleigh-Durham, NC; Sacramento, CA; Salt Lake City, UT; St. Louis, MO; Tipton, CA
  • Canada: Chilliwack, BC; Edmonton, AB; Grande Prairie, AB; Lethbridge, AB; Montreal, QC; Prince George, BC; Regina, SK; Saskatoon, SK; Toronto, ON; Truro, NS
  • Mexico: Polotitlan, MEX
  • Europe: Caorso, ITA; Donington Park, UK; Meppen, DEU; Moerdijk, NLD; Ocana, ESP; St. Aubin sur Gaillon, FRA; Donington Park, UK
  • The Middle East: Dubai, UAE
  • Asia: Narita, JPN; Beijing, CHN
  • Australia: Brisbane, QLD; Geelong, VIC

Acquisitions

In 1999 Ritchie Bros. acquired Forke Brothers, an equipment auction company based in Nebraska, USA and one of its major competitors. The company moved its U.S. headquarters to Lincoln, Nebraska following the acquisition.[31] Ritchie Bros. made its foray into the agricultural equipment auction business with the acquisitions of All Peace Auctions of Grande Prairie, Alberta, Canada in 2002; LeBlanc Auction Service in Estevan, Saskatchewan, Canada in 2004,[32] Dennis Biliske Auctioneers of Buxton, North Dakota, USA in 2006; Clarke Auctioneers of Rouleau, Saskatchewan, Canada in 2007;[33] and Martella Auction Company of Tipton, CA in 2009.

In 2012, Ritchie Bros. acquired AssetNation, a USA-based online marketplace and solutions provider for surplus and salvage assets, with the intention of developing a new service for equipment buyers and sellers. In 2013, building on the AssetNation platform, Ritchie Bros. launched Ritchie Bros. EquipmentOne, an online marketplace for equipment and materials.</ref>[1]</ref>

Notable Auctions

Among the notable auctions conducted by Ritchie Bros. Auctioneers: construction and other equipment used to rebuild the airport, shipyard and other facilities after the Falkland Islands war (1987); almost 9,800 items and pieces of equipment used in the US$1 billion cleanup operation following the Exxon Valdez oil spill in Alaska (1990); and the equipment used to build the Confederation Bridge that links the province of Prince Edward Island with the Canadian mainland (1997).

Launch of Ritchie Bros. EquipmentOne

In 2012, Ritchie Bros. acquired AssetNation, a USA-based online marketplace and solutions provider for surplus and salvage assets, with the intention of developing a new service for equipment buyers and sellers. In 2013, building on the AssetNation platform, Ritchie Bros. launched Ritchie Bros. EquipmentOne, an online marketplace for equipment and materials.[34]

Ritchie Bros. celebrated its 50th anniversary in 2008

50th Anniversary

Ritchie Bros. celebrated its 50th anniversary in 2008. As a gift to the heavy equipment industries it launched RitchieWiki in September 2008 at MINExpo INTERNATIONAL in Las Vegas, Nevada.

In 2008 Ritchie Bros. Auctioneers Inc. conducted 340 unreserved industrial and agricultural auctions generating gross auction proceeds of US$3.57 billion.[35] The company sold more than 253,000 lots from 37,000 consignments and processed 277,000 bidder registrations. Of those, 84,000 were successful buyers with a total of 16,000 buyers purchasing their equipment online.[36] 

The Company Today

In 2013 Ritchie Bros. sold US$3.8 billion of equipment at its auctions worldwide.

Industrial auction results

Year ended December 31, 2013
Year ended December 31, 2012
Number of industrial auctions
245
221
Bidder registrations
425,000
389,500
Buyers
104,550
99,250
Consignments
43,550
42,100
Lots
301,000
287,000


Average industrial auction

Year ended December 31, 2013
Year ended December 31, 2012
Gross auction proceeds
$14.3 million
$16.5 million
Registered bidders
1,740
1,760
Consignors
180
190
Lots
1,230
1,300


Senior Leadership Team

  • Ravi Saligram - Chief Executive Officer
  • Bob Armstrong - Chief Strategic Development Officer
  • Rob McLeod - Chief Financial Officer
  • Steve Simpson - Chief Sales Officer
  • Andrew Muller - Chief People Officer
  • Kenton Low - Chief Marketing Officer
  • Randy Wall - Chief Productivity Officer
  • Karl Werner - Chief Auction Operations Officer


Board of Directors

  • Beverley Briscoe - Chairman of the Board
  • Ravi Saligram - Director & CEO
  • Robert Murdoch - Director
  • Eric Patel - Director
  • Edward Pitoniak - Director
  • Christopher Zimmerman - Director
  • Robert Elton - Director
  • Erik Olsson - Director


References

  1. Ritchie Bros. website. 2008-09-09.
  2. About Ritchie Bros. Ritchie Bros. website. 2008-09-09.
  3. News. Ritchie Bros. website. 2008-09-09.
  4. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 23
  5. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 17
  6. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 24
  7. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 25
  8. RB History. Funding Universe. 2008-09-09.
  9. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 25, 27
  10. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 35, 39
  11. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 35
  12. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 39, 48, 70
  13. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 39
  14. History. Ritchie Bros. website. 2008-09-09.
  15. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004)
  16. History. Ritchie Bros. website. 2008-09-09.
  17. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 46
  18. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 48, 70, 71, 73, 75, 76, 78, 88
  19. History. Ritchie Bros. website. 2008-09-09.
  20. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 79
  21. History. Ritchie Bros. website. 2008-09-09.
  22. History. Ritchie Bros. website. 2008-09-09.
  23. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 91, 98;
  24. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 104
  25. Company History. Funding Universe. 2008-09-09.
  26. News. Ritchie Bros. website. 2008-09-09.
  27. March 31, 1999 Annual Report – English Annual Report. Sedar. 2008-09-09.
  28. News. Ritchie Bros. website. 2008-09-09.
  29. April 6, 1998 Long Form Prospectus – English Company Documents. Sedar. 2008-09-09.
  30. List of Ritchie Bros. auction sites on rbauction.com
  31. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 116
  32. News Release. Ritchie Bros. Auctioneers, 2004-02-06.
  33. Jeffrey L. Rodengen, The Legend of Ritchie Bros. Auctioneers (Write Stuff Enterprises Inc., 2004), p. 124;
  34. http://www.rbauction.com/media/news-releases/archives
  35. Ritchie Bros. Annual Report 2008. 18-08-2009.
  36. Media Quick Facts. Ritchie Bros. Official Corporate web site. 18-08-2009.

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