are online sales legit?

[5PCC]

I've been blown away by many of the final selling prices in the online sales this Fall. BUT, I just figured that other folks had more money than I do. That was until someone contacted me, asking me if I was interested in a heifer that I knew had supposedly just sold (for really cheap) two days prior in an online sale. I never told them that I knew that she had been in the sale, and I didn't buy her either. My husband and my mother are convinced that the owner/seller of the animals place bids on the online sales to inflate the prices. So perhaps in this case, the seller was the only bidder and the seller got stuck with the animal?? My husband and my mother also say that the final selling price often isn't really as high as the auction says that it is. SO is this true? Are online sales legit?

 

[RankeCattleCo]

I personally know of a guy who bids his cattle up. Just be very investigative of bidder numbers... How often, how much, and on how many animals.

It always seemed odd when one bidder was in on over 3/4s of the calves right up until the end.. Lol

 

[Medium Rare]

Some are and some aren't, but this has been happening well before online sales ever became popular.

The long distance phone bid offs of yesteryear while watching vhs tapes of the cattle during a day long marathon of sitting by the phone playing three way tag with some mythical figure always felt very dirty to me.

 

[sj0515]

Some of the salers have a minimum set price and if it is not met, the calf does not sale.

 

[GoWyo]

If a seller floors the animal at say $2000, but really wouldn't sell the animal for less than $3000, they may go ahead and phantom bid the animal using different buyer numbers.  A seller could pose as a buyer under several aliases.  I always assume this is going on and have a firm idea of what I will pay for a certain animal, and understand that a seller will want to protect some of their animals higher than the floor price.  Have gotten some very good deals on local cattle that I had a chance to see in person.  Have not had any regrets by making sure to see the animals in person and stick to budget on the online auction.

 

[RankeCattleCo]

Why not have a private treaty sale if you already have a price in mind?

 

[Tallcool1]

I have bought a few online, and I have bid on A LOT!

I have gotten a few phone calls as the auctions have been winding down.  I have been asked if I was still interested at my $4500 bid, even though the steer is at $5,000 now!  One seller even called me, and told me that they "really want to see us get one of their steers", and the calf is ours at $3,750...don't pay any attention to what the bidding does. 

This is what you have to watch for.  Lets say that you bid on Lot #1, and run him up to $4,500 and get outbid.  Now you switch over to Lot #2, and you run him up to $4,500...and get outbid again.  So you decide to jump onto your 3rd choice which is Lot #3, and he is only at $3,000...and the sale has been in "Extended Bidding" mode for an hour.  Anybody care to guess what you are going to end up paying for Lot #3?  That's right...$4,500 or darn close to it.  They quickly figure out that you are on a budget of $4,500.

I have a brother that lives 3 states away, and a cousin that lives 5 states away.  All three of us are registered bidders, and I have control of all 3 bidder numbers.  I don't EVER bid with the same number on the same sale.

During the early sales this fall, I would say there were a whole lot of the prices that were not real.  As the traders get filled up, the prices fall.  I believe the current prices a whole lot more than I did 5 weeks ago!

The other thing that you are seeing a lot of is traders just swapping cattle.  You buy mine for $15,000 and I will buy yours for $15,000.  Now we have both sold one for $15,000 and really all we did was swap steers.

The thing about this is, there are a whole lot of families that get caught in this web.  Be careful bidding when something doesn't seem quite right.  Your one single bid may just make you an owner!

 

[5PCC]

This is all extremely interesting information! When I showed in the 80s and 90s, we all loaded up in the family car and went to some guy's farm. Once we were there, we all loaded up in the guy's pickup and drove around in the pasture looking at the calves. We did this until dad found what he was looking for, and then he either went back with the truck and trailer to pick the calf up, the guy delivered the calf, or they met somewhere in the middle. From time to time, we would buy one at a club calf auction, but not very often.

I do not like to buy cattle that I have not seen in person, but I have bid on several this year. I did not win any auctions because they were all well out of my price range. I fell in love with a black Baldy maintainer heifer. I saw her in person just a few weeks before the online sale. She sold for $13,500. She was a nice heifer but she wasn't worth that!

Instead, I put a lot of miles on my car and spent several weekends on the road looking at cattle. I was able to find three really nice heifers ( for my 3 kids) from three different breeders. All three heifers come with registration papers and all three heifers are halter broke. They were all less than the top of my price range. I am pleased with both the quality and the price of my purchases. I also met some fantastic people in the process!

 

[dutch pride]

I am sure that "protection" by the sellers has been around long before on-line auctions were around. Hard to tell even in a live auction who you are bidding against at times. My thought is that you have to put a value on each animal you would consider owning "before" the sale starts. If you can then purchase said animal for an amount up too that value, you should be happy. If the animal goes for more than your value of it, no matter whom is bidding you up, let it go. I tell folks that the "value" of any animal is whatever someone is willing to pay for it. If a seller thinks the value of his animals is higher than others are willing to pay and "protects" that price, he may end up with a lot of "valuable" cattle in the barn and no money in his bank account.

DLZ

 

[Tyler]

I have bought a few online, and I have bid on A LOT!

I have gotten a few phone calls as the auctions have been winding down.  I have been asked if I was still interested at my $4500 bid, even though the steer is at $5,000 now!  One seller even called me, and told me that they "really want to see us get one of their steers", and the calf is ours at $3,750...don't pay any attention to what the bidding does. 

This is what you have to watch for.  Lets say that you bid on Lot #1, and run him up to $4,500 and get outbid.  Now you switch over to Lot #2, and you run him up to $4,500...and get outbid again.  So you decide to jump onto your 3rd choice which is Lot #3, and he is only at $3,000...and the sale has been in "Extended Bidding" mode for an hour.  Anybody care to guess what you are going to end up paying for Lot #3?  That's right...$4,500 or darn close to it.  They quickly figure out that you are on a budget of $4,500.

I have a brother that lives 3 states away, and a cousin that lives 5 states away.  All three of us are registered bidders, and I have control of all 3 bidder numbers.  I don't EVER bid with the same number on the same sale.

During the early sales this fall, I would say there were a whole lot of the prices that were not real.  As the traders get filled up, the prices fall.  I believe the current prices a whole lot more than I did 5 weeks ago!

The other thing that you are seeing a lot of is traders just swapping cattle.  You buy mine for $15,000 and I will buy yours for $15,000.  Now we have both sold one for $15,000 and really all we did was swap steers.

The thing about this is, there are a whole lot of families that get caught in this web.  Be careful bidding when something doesn't seem quite right.  Your one single bid may just make you an owner!

Excellent thoughts, I have bought and bid on a few online sales but never thought of them figuring out your budget.... good thing I haven't bid on two animals on the same sale yet!  I agree with others that you should always put a price on each individual calf and stay at or below that price.

 

[DSC]

These guys are getting really good at these online sales. I have been on both sides (buying and selling). The sellers can have their own bidder numbers and are bidding them up. Also a lot of these online sales companies have guys working the sale and will have phantom bidder numbers as well and can run up the cattle as well as use one calf to continue the "extended bidding". A lot of times this is used to give the buyers another 5 minutes to decide and bid on the calf again or it gives them time to contact the perspective buyer and convince them to bid again. I have also seen where some of these calves are sold prior to the sale even being available online yet. They will have them sold but will have people run them up on the sale to make it seem like they sold for more than they actually did.
Just my experiences. It isnt always as it seems......

 

[5PCC]

Interesting. So I could be bidding on a steer or heifer that has already been sold and therefore, it doesn't matter how high I bid because I won't win the auction anyway??

 

[vc]

Oh if you go high enough they will sell it to you.

 

[DLD]

If you want to buy anything, you need to decide what that one is worth to you, bid 'til you get them bought or they get out of your price range (same with a live auction, private treaty, whatever...).  If you get one bought be happy, if you don't, forget about that one and find another one.  Don't worry about if or who might be running you.  If the seller isn't willing to turn loose at whatever price, it wouldn't be any different in a live auction or at private treaty.  If you don't trust who you're dealing with, you shouldn't be trying to buy anything from them anyway.

I imagine Tallcool1 is right about a seller being able to guess at your budget - but it's not very smart on the part of the seller to assume that I'm willing to pay the same for every calf I'm interested in.  It might be an advantage to use different numbers to bid on different calves, but I guess I'm just too hard headed to do that - I haven't found a calf yet that I couldn't live without.  Even if I ran another one to $5000 if I think I'd give $3000 for the next one I bid on, I go there and quit.  If a seller gets hung with one trying to get an extra dollar out of me, then so be it.

 

[Pleasant Grove Farms]

running calves up online with phantom bids is no different than at a live auction where field reps run bidders up with phantom bids.

 

[BroncoFan]

I can't say that I blame sellers for running phantom bids. They have their floor prices that the calves have to get to in order to sell. To buyers I would advise to figure out how much you would spend on each calf that your looking at. If the calf goes higher then move on. If your willing to do some investigating and are patient you will find a good sleeper. A seller can lower the floor if the calf isn't getting the attention that the seller hoped for. We had a steer that we wanted to get $3000 out of this spring but let him go at $2500. It was our loss and their gain because he really came on through the summer and the young girl that is showing him just loves him to death. Hopefully we will get a repeat buyer out of the deal.

 

[jwfarms]

It has gotten really bad.  There is a few different reasons, obviously the seller wants to get as much money as they can and there is always a bottom of where they won't sell it.  Instead of having a reserve or min price, the auction house puts in shill bids to reach this #. 

It greatly benefits the auction house because as the prices get run up, more people look at the auction and say gee if they can get those prices, let me list my cattle with them.

I know for a fact this happens as I told by a good friend that had an auction recently, the rep would ask him what he needed out of a particular lot, knowing that if it doesn't reach that, it is not selling and there wasn't a reserve or minimum on it.

 

[chambero]

There is no substitute for just showing up to a trader/breeder's place with a check and a trailer.  Any other method is increasing your risk - be it overpaying or not buying as good of a calf as you think you are.

 

[DSC]

Agreed!!!  (clapping) I know if someone shows up to my place ready to write a check and they have a trailer with them I will price them lower or let the bargaining begin. A check today is worth more than holding on to a calf or two for a few more weeks or a month. 

 

[Steve123]

Always contact the seller after the sale if you don't get the one you wanted and let them know you where interested in that calf and if anything happens with the sale to give you a call.  Never ask "Did that calf really sell?" and everyone saves face that way. I think I have purchased more cattle after a sale than during the sale.