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ONLINE LIVESTOCK AUCTIONS: Australian success, and the potential for New Zealand

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Executive Summary

This paper provides a background of the Australian Livestock industry with a specific focus on the rise of an online auctions platform, AuctionsPlus (www.auctionsplus.com.au).
My findings show that the use of AuctionsPlus can deliver verifiable economic and social benefits to its users.

During a research trip throughout Australia’s rural New South Wales and Victoria I spoke with Farmers, Feedlot operators, Stock Agents, Transport operators, Saleyard managers and Meat buyers about industry dynamics from their unique perspectives. The focus of these discussions was to understand how AuctionsPlus integrated into their business, where the platform worked best for them and where it didn’t.

I’ve then considered the relevance of all these factors in the New Zealand context to understand the potential benefits for our own industry.

AuctionsPlus is neither a fundamentally new method of transacting livestock nor a disruptive technology. It does however harness favourable attributes of traditional sales methods and combine them on a single, highly efficient internet marketplace where vendors, agents and buyers can participate without the need to come together physically.

I’ve found that tangible economic advantages alone are not enough to drive adoption, and that the social benefits of improved animal welfare and bio-security outcomes can drive adoption even in the absence of any direct financial advantage. Also, stock agents and farmers

are more likely to support the platform when existing relationships can be maintained.

The real key to long-term success is the establishment of underlying trust in the platform and its users.

At the time of writing New Zealand does not have a comparable sales method and questions remain as to whether the New Zealand market has the scale to support this business model, or what level of market penetration will be needed to support a sustainable business. At least two companies are looking to fill this market opportunity and my recommendations will give those in this relatively new field a grounding in the lessons learned during AuctionsPlus’s journey to success. I believe this success can be replicated in New Zealand for the good of all industry stakeholders.

The most important recommendation I make is that to initially gain traction, a successful online platform will need to have the full support of Stock Agents. While this is an electronic marketplace; people are at its core.

ONLINE LIVESTOCK AUCTIONS: Australian success, and the potential for New Zealand