Mark and Matt Alexander have become experts at moving colossal pieces of mining machinery around the globe – and all with the click of a few buttons from their Sudbury office.
The brothers are the creative team behind Mine Source Auctions, an online auction house, founded in 2002, that specializes in just one thing: divesting mining equipment.
Growing up in and around the industry – dad David co-leads the mine-decommissioning company Mindecom Industrial Contractors Ltd. – the brothers got to know the business and the machinery. Mine Source was launched after they realized mining companies were looking for a way to efficiently and transparently sell off surplus equipment.
“There are large companies that do construction equipment and bulldozers, backhoes, but our focus is the mining industry,” Mark said. “We know that equipment really well, and we stay within that narrow niche because, still, mining is a massive market.”
Until now, Mine Source has hosted mostly reserve auctions, in which the seller seeks a minimum amount for an item. Once a reserve has been met, the item stays up for auction for a period of five business days.
But last November, the company hosted for the first time a live, one-day auction, liquidating surplus equipment from three Northern Ontario mines – Kirkland Lake Gold’s Macassa, Glencore’s Kidd Operations, and Barrick Gold’s Williams operations.
Mine Source hired an auctioneer through a third-party provider, and audio and video of the auction were broadcast online as the bids were called.
People from across the Americas tuned in to participate, Matt said, and by day’s end, Mine Source had auctioned off 120 lots of equipment.
One-day, unreserved auctions can be useful for moving equipment fast, he said; for example, if a company needs to use the space where the equipment is sitting for another purpose.
“It depends on what the vendor’s requirements are,” Matt said. “If they need it gone quickly and they don’t mind a low reserve, then the one-day type of auction works well for them. If they have time to sit on it and they want to get full value out of it – perhaps it’s on their books for a high value – they can’t let it go otherwise for lower than that.”
Non-reserve auctions can, unfortunately, come with a bit of a stigma, Mark said. Sellers can be wary of setting a low appraisal on an asset that’s valuable for them, especially if they’re looking to get a minimum return on it.
But he noted there’s a certain psychology associated with non-reserve auctions that can work in the seller’s favour.
“It gets people in the mix quickly when you have a very low reserve or no reserve,” Mark said. “People flock to it, and once that bidding gets started, it’s a momentum that builds and you have everyone’s attention at the same time, so often you go above the reserve.”
Equipment they’ve sold has travelled across Northern Ontario, the Americas and beyond. And, exposure from their first foray into non-reserve, live auctions has introduced them to new markets. They’ve recently shipped equipment to Moldova, and have received surplus from major companies in Zambia and Central Africa.
“Just with this live auction we did, many new buyers came out of the woodwork that we had never dealt with before, and we’re developing new relationships now,” Mark said. “So every day we’re finding new buyers and, as we advertise, our reach grows.
Though their success hasn’t necessitated a huge shift in personnel, they have in recent years brought on an IT professional, an office assistant, and a salesperson. But Mark said they are looking to grow the company further.
While mining operations have started the shift to automating their operations, including incorporating battery-electric vehicles, the Alexander brothers said there’s still a huge demand for traditional, mechanical machinery.
And when it’s ready to go up on the auction block, the pair can get good value for it.
“We’ve had Mine Source for 16 years now, and we’re at a point where we know the players in the mining equipment market, and so we’ll have all eyes on your piece of equipment,” Mark said.
“So if it’s worth $45,000 or maybe more, we’ll get that.”
The Drift magazine, a new publication from Northern Ontario Business, features profiles on the people and companies making important contributions to the Northern Ontario mining service and supply industry.
