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Featured cattle. For more information on these cattle click on photo. To set up an appointment to veiw cattle contact Russell Hooks at 409-381-0616.

Herd Of Trophy Steers

 

Straight Butler Cow $3,200 

   

 

 

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Wednesday
Sep242014

Buying Cattle at Auction vs Private Treaty

 

What are some of the reasons for not buying or for being cautious when buying at an auction?  

1) Always remember that the animal is being offered for a reason.  

a. Ask yourself “why is this animal being sold?” Is this animal in the sale because it has a defect such as poor fertility, bad udder, poor quality offspring or bad habits. Have you seen this animal in several different sales within the last year? Repeat sale appearances could mean there is a problem with the animal.

b. The animal could be in the sale simply because the seller is overstocked, is short on pasture/hay or has kept offspring out of this animal.

But how do you know which of these is the case. You must be observant when looking at the animal, ask questions of the seller if they are available and check production records.

 2) You have to make a buying decision in a matter of a few seconds before the auctioneer slams the gavel and says “sold”.

3) You can get caught up in the bidding and end up over spending.

4) The consignor will need a higher sale price for the animal due to their added expenses, high consignment fees and commissions that are charged by most sales.  

5) You should always be aware of who you are bidding against. In some cases it might be a friend or someone who has been instructed to run the bidding up to the price the seller wants for that animal.  

6) At some sales a floor or minimum has been set by the sale promoter to keep the sale average higher. Sales have the right to do this, but the floor prices should be announced before the sale. This is not always done and it creates a problem for you as a buyer, because you won’t know the true market value of the cattle. Market Value: the amount that a seller could expect to obtain for property or goods sold on the open market.

7) Sometimes you can end up traveling to a sale only to have all the cattle you are interested in sell for prices that are out of your price range. You still have the travel expense, but no cattle to show for it.  

Now let’s take a look at some of the aspects, both positive and negative, of purchasing cattle by “private treaty”. Private Treaty is the sale of property according to terms negotiated between the buyer and seller. This method of selling and purchasing cattle generally only involves the seller and the buyer. There is no auctioneer, ringmen, multiple buyers or sale Management Company involved in this type of sale. It is more of a one-on-one approach.  

What are some of the negative reasons for purchasing cattle by Private Treaty?

1) May require a great deal of traveling in order to acquire different genetics that you are interested in adding to your program.  

2) As a prospective buyer you may feel pressured by some sellers to make a purchase. Most breeders will be happy to show you their cattle and program without pressuring you to make a purchase.

3) The price is set by the seller and it may or may not reflect the market value of the animal. In other words, if you plan on reselling the animal shortly after you have purchased it, you may or may not get your money back out of the animal. When you consider the price, you need to decide if you are willing to pay that amount to have the animal in your herd. Is the animal worth it to you? It’s that simple.

4) You will probably receive little to no public recognition of your purchases unless the seller places a “thank you” ad in a breed magazine. This could be considered a pro or a con depending on the buyer’s perspective.

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