Tractor Zoom Introduces Time on Lot Feature to Combat Increasing Carrying Costs

Tractor Zoom, a leading provider of farm equipment and heavy machinery valuation data, today launched another key feature in its Tractor Zoom Pro platform to help equipment dealers proactively identify and monitor at-risk equipment in their used equipment inventory. The new feature, referred to as Time on Lot, predicts the likelihood of an individual tractor or combine being listed for longer than 180 days. As equipment dealers face average carrying costs ranging from $1,400 to $1,600 per week per million dollars in inventory, Time on Lot will help minimize the amount of aging inventory on their lots and combat the associated carrying costs.

“Carrying costs have become a significant challenge for our dealer customers, and with rising interest rates, the expenses associated with holding on to equipment are likely to escalate,” says Tyler Lowy, Senior Account Executive for Tractor Zoom.  “Considering our current dealer listings on Tractor Zoom, which account for over $1.6 billion of tractor and combine inventory, our Time on Lot feature predicts that approximately $15 million worth of equipment will not sell within the next 180 days, despite being listed less than 90 days. This translates to nearly $380,000 in expected carrying costs for these recently listed pieces alone!” 

Built on a machine-learning model leveraging millions of equipment records containing listing, market, and seasonal attributes, the Time on Lot feature offers unparalleled precision and insights. By accurately predicting the likelihood of individual tractors or combines remaining unsold beyond 180 days, Tractor Zoom will enable dealers to minimize the amount of aging inventory on their lots and related financial burdens.

To ensure seamless integration and accessibility, existing Enterprise customers now have immediate access to the Time on Lot feature within the Tractor Zoom Pro platform. This feature enables dealers to efficiently manage pricing and repricing strategies for hundreds of tractor and combine models across multiple locations, counties, and states. 

Within the Tractor Zoom Pro Inventory interface, users will find a warning symbol in the “Days Listed” column on lots that aren’t expected to sell within 180 days. Hovering over the warning label reveals the rationale behind the prediction, including variables such as current market conditions, missing images, starting price, location, and more. For further analysis, users can click on specific equipment pieces to access a detailed view of the likelihood that a piece of equipment won’t sell in 180 days, as well as some additional tips and descriptions.

A detailed view of a specific piece of equipment showing the likelihood that a piece will age past 180 days.

Based on feedback collected from dealerships leveraging Time on Lot since its July release, additional context has been added to the specific variables flagged for why a piece of equipment is likely to age past 180 days. This context, accessed by clicking the “i” information icon next to the variable, is not only designed to inform why the variable has been flagged but also present potential actions or decisions to make to help move the lot.

Tractor Zoom also offers automated email alerts specifically for the Time on Lot feature via "Likely to Age" notifications. Dealers can customize these alerts based on the minimum number of listing days, the likelihood of not selling, or specific types of equipment. By delivering actionable insights directly to dealers’ inboxes, Tractor Zoom ensures that critical inventory management decisions are made promptly and effectively.

Acknowledging the importance of providing transparency and context, the Tractor Zoom team has incorporated severity levels and impact scores into the Time on Lot feature. Flagged lots are marked as “Somewhat Likely” or “Highly Likely” based on being above or below a 75% chance of aging past 180 days. Additionally, impact scores highlight the relative effect of each feature – pictures, market trends, seasonality, locations, days listed – on the prediction, enabling dealers to prioritize pricing and marketing decisions with greater precision. 

Tractor Zoom has rigorously tested the Time on Lot feature, which demonstrates an impressive 85% accuracy in predicting equipment that will not sell within 180 days. To prevent excessive noise and ensure that dealers focus their resources on the most likely aging inventory, the model has been designed to be extra cautious in flagging lots as non-sellers within the specified timeframe. 

Based on reviewing the findings of their days listed analysis, Josh Martin, Used Equipment Manager at Atlantic Tractor, quickly identified the number of images for his listings was a primary reason they were likely to age past 180 days. Armed with this information, Martin began the process of updating the dealership’s standard operating procedure (SOP) for capturing equipment images. The new SOP explicitly outlines the exact images to grab for each piece of equipment, which has increased the effectiveness of their listing ingestion and also decreased the number of lots flagged as likely to age based on number of images.

“Our inventory that wasn’t selling, or was predicted to age past 180 days, all had one thing in common – Tractor Zoom Pro showed the picture quality was poor,” said Martin. “We replaced all pictures on those units and immediately saw an increase in activity and sales on those units. Tractor Zoom Pro allowed us to identify small issues that you would not think could cause a machine to age.”

Developing a predictive model necessitates two crucial components: ample high-quality data and a properly tuned machine learning model. The Time on Lot feature leverages millions of daily equipment listings from Tractor Zoom and its proprietary database, complemented by external market data and seasonal components. With this comprehensive dataset, Tractor Zoom employs the XGBoost (eXtreme Gradient Boosting) algorithm, renowned for its accuracy. While XGBoost provides reliable predictions, understanding the “why” behind these predictions is equally important.

“Having a prediction is one thing but it is important to understand ‘why’ the model arrived at a given answer,” said Hank Mandsager, Data Scientist at Tractor Zoom. “To make sure we are providing actionable insights and the ‘why’ we borrow  a concept from cooperative game theory that has been around since the ‘50s, called Shapley Values.”

Shapley Values calculate the contribution of each feature to the overall model prediction. This is showcased within Tractor Zoom Pro Inventory where users see a list of the top reasons why a piece of equipment is likely to age past 180 days. Additionally, a scale showing the relative importance of the reasons helps users identify the most impactful actions to take to help turn a piece of equipment.

Looking ahead, Tractor Zoom is committed to continuous improvement and innovations, aiming to provide a comprehensive suite of solutions for proactive and predictive inventory management. By putting their customers first and empowering them with honest, accessible, and actionable equipment insights, Tractor Zoom remains dedicated to transforming the dealership landscape. 

To further assist dealerships with proactive inventory management, Tractor Zoom Pro now connects aging inventory to the new equipment Carrying Cost analysis feature, which helps dealerships quickly calculate and monitor carrying costs in real time. This helps dealers further prioritize which lots to focus on to help improve overall dealership margin. 

The company continues to work on additional products and feature enhancements, including further plans for Time on Lot. In addition to expanding the feature to additional equipment categories beyond combines and tractors, the company is working towards informing dealerships on the likelihood of equipment aging past 180 days earlier in their sales and evaluation process. With the roll-out of its Appraisal product, the company is aiming to sync likelihood to age information when a piece of equipment is being cataloged and evaluated for appraisal. Having this information at the onset of listing ingestion will help dealers make more data-driven decisions on what equipment to trade in, advertise, or send to auction.