Mastro has raised Buyer Premium to 20% [Archive]

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11-14-2006, 07:34 AM

Posted By: RayBfor me. The Buyers premium at 15% alway kept me away from the Big Box Auction houses anyway. The prices are inflated to begin with, even on most items that are more mainstream and to tack on the Buyers Premium makes it unreasonable to even consider participating. I'm just small fry I guess with my humble low grade T-206 effort. The catalogs are fun to look at though! <img src="/images/happy.gif" height=14 width=14> RayB

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11-14-2006, 07:37 AM

Posted By: Steve M.but make sure that you place some bids to insure getting the catalogue. Make them early and you are sure to be outbid. <img src="/images/happy.gif" height=14 width=14>

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11-14-2006, 07:39 AM

Posted By: Josh AdamsWhen you're the biggest, I guess you can do what you want! There are other auction houses with similar material, and lesser premiums. 20% seems a little excessive. Go Go White Sox 2005 World Series Champions!

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11-14-2006, 07:41 AM

Posted By: Tom Boblittof more pressure to get quality lots. They are dropping consignment fees more to get more stuff in I bet and consequently having to make up on it on the sell side. Those door-stop catalogs aren't cheap......

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11-14-2006, 07:55 AM

Posted By: Jeff PriznerAs a Consignor in their current auction, this really pisses me off. Had I known about the 20%, I would have gone with REA. They could have just as easily announced this raise before taking consignments - shady!

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11-14-2006, 08:05 AM

Posted By: warshawlawAs a consignor. Sorry guys, but next time if you want my stuff the commission on my end will have to be lowered correspondingly. About the only "benefit" is that it is a lot easier to calculate a straight 20% in your head.

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11-14-2006, 08:29 AM

Posted By: WesleyAs a consignor in the current auction, I am a little peeved as well. Like Jeff, if I had known about this in advance, I would certainly have chosen REA instead. The higher buyer premiums will affect the decision of consignors more than that of buyers. Buyers can just factor in the final price into their bids, whereas consignors have more money taken out of the bottom line. This is a good opportunity for other auction houses to pick up more consignments.

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11-14-2006, 08:36 AM

Posted By: leonIf you posted in the other thread you can cut and paste back over to this one...here is my initial thought.... As always I will figure the buyers premium into the bid that I make. My real question is will this prohibit them from getting more material in the future? As a consignor I would have to think leaving at least 20% on the table is something that has to be considered. With that being said I do know that other auction houses are close to those fees.... 19.5% for Heritage.....and others are within a few percent too.....

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11-14-2006, 08:37 AM

Posted By: Hal LewisI am also a consignor and also would have liked to know this BEFORE making my decision.

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11-14-2006, 08:39 AM

Posted By: Joe_G.This may promote more sales directly between sellers and buyers. The middle man's cut seems awful substantial. Assuming a 15% consigners fee + a 20% buyers fee, let's work through an example of a $1000 hammer price. Consignor/Seller receives $850 Buyer pays $1200 So Auction House keeps $350 The auction house receives over 40% of what the consignor/seller receives (350/850 = 41.2%). Just seems excessive even after factoring in the auction houses expenses. Will I still bid, yes, will this factor into my bidding, yes. Aren't most auction houses still closer to 10-15% buyer fee? Best Regards, Joe Gonsowski

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11-14-2006, 08:42 AM

Posted By: Daveonly way to stop this is put 'em somewhere else to sell, or stick them on the bay for 6% of your price going to a "auction house"

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11-14-2006, 08:42 AM

Posted By: Tom Boblittnear the 15% on the consigning side. I'd be curious what the total average Fee is. I bet overall it'd be in the mid to upper single digits. Just my opinion.......

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11-14-2006, 08:43 AM

Posted By: Al C.risafulliFor me to bid in an auction with a 20% buyer's fee, a card would have to fill one hell of a hole in my want list. -Al

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11-14-2006, 08:43 AM

Posted By: WesleyMastro could have just as easily have announced this raise before taking consignments. To spring this surprise on all the December consignors the day the auction preview goes up is not a straightforward way of doing business.

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11-14-2006, 08:47 AM

Posted By: steve fGood point, The ol' classic bait n switch ehh Wes?

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11-14-2006, 08:56 AM

Posted By: warshawlawI've said it before and it bears repetition now: NEGOTIATE!!!! A consignment fee is an agreed figure. With the number of qualified auction houses out there, NO ONE leaves 35% on the table unless they are ignorant. I'd venture an educated guess that the average consignor pays Mastro 10% as a commission and that someone with a very significant item will pay 0%-5%. Coincidentally, I had a related discussion yesterday (I was really sick on Friday and ended up in the hospital ER that evening with respitratory problems, so mortality came up as a discussion at home; feeling much better now and back to work after a weekend resting). I told my wife that if I was to die unexpectedly, she is to call some auctioneers I named and "auction" the right to liquidate my collection among them, and I told her not to pay any commission on the seller's side.

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11-14-2006, 09:06 AM

Posted By: Griffin'sSure makes REA look even better for consigning items. Even if you negotiate your selling commission down to 0% it does effect how the bidders go after that item. Shipping fees were jacked way up earlier this year, now buyers penalty. What next? Online bidding fee, catalog fee? Starting to sound like a bank.

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11-14-2006, 09:07 AM

Posted By: Brent ButcherLeon mentioned Heritage at 19.5% - the big differences between Heritage and Mastro is Heritage lets you use credit cards to pay. I don't think Mastro offers this even with the increased premium. Also, Heritage will hold the cards for 6 months I believe while you pay them off(pre-qualified bidders only.) I haven't taken advantage of either of these options but I'm sure that's a huge benefit to some. With the increased buyer's premium Mastro could afford these same options and I would think the end result would help the sellers.

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11-14-2006, 09:21 AM

Posted By: Jeff LichtmanGriffin's point is well-taken: negotiate your consignment fee down to zero and you're still stuck with the fact that your final take will be lower due to buyers being scared off by a 20% fee. It's foolish in my eyes to raise it above any other auction house's fee because Mastro will stand out as the greediest - not that they aren't already with their fee simply to get their book. I have a card worth $20,000 that I'm about to send to one of the big houses and I can tell you that Mastro will not get a call.

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11-14-2006, 09:25 AM

Posted By: barrysloateI think one way to look at the buyer's premium is to simply say if a lot is worth $1000 to me, my top bid will be $800. Isn't that the same as bidding $850 in a 15% auction? I think one of the reasons buyer's premiums are going up (besides the obvious profit margin) is that auction houses want to be able to offer selling fees as close to 0% as possible. That makes them look more competitive. Nobody likes to see these premiums go up but it is clearly a trend.

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11-14-2006, 09:30 AM

Posted By: Jeff LichtmanBarry, this is true, but by offering closer to 0% on consignment fees and increasing the buyer's premium, they are just keeping their take even while reducing final take of the seller and increasing the final cost to the buyer. Yet Mastro is hardly advertising a lowering of consignment fees. As a seller, does anyone really think that Mastro generates higher final bids than say Memory Lane, Mile High or REA to make it worth it to place anything with them?

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11-14-2006, 09:32 AM

Posted By: barrysloateI think if a seller has a really good collection he can pretty much dictate his own selling fees. Would Macy's turn down a zero percent fee if they knew the collection would end up with Gimbel's? (I know Gimbel's is defunct, it's just an expression).

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11-14-2006, 09:46 AM

Posted By: Jeff LichtmanWell, what if REA, Mile High and Mastro gave you the same consignment deal? Wouldn't you go with the place that had the lowest BP in order to get the highest bids?

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11-14-2006, 09:56 AM

Posted By: JimBIt's all just number shuffling. Buyers should figure the BP into their bids and consigners should try to negotiate the best consignment terms they can for their item. No big deal. If I had consigned something under the presumption of a 17.5% BP, I would call and straighten it out. JimB

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11-14-2006, 10:05 AM

Posted By: barrysloateI think over time collectors build a rapport with a particular auction house and when it is time to sell they tend to gravitate that way. I don't think any of the major auction houses has a magic list of bidders that the others don't. You consign with whom you feel most comfortable with, and in this competitive market if you have a substantial collection you can negotiate favorable terms.

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11-14-2006, 10:05 AM

Posted By: David VarghaChalk up another thoughtful move by the head of Customer Care at Mastro, Benjamin Dover. DavidVargha@hotmail.com

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11-14-2006, 10:07 AM

Posted By: Jason LI will pay absolutely no one that much money for the pleasure of buying something...that implies that you think the item is at least 20% undervalued...and in this market, nothing is that much of a bargain...pure silliness

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11-14-2006, 10:21 AM

Posted By: Griffin'shas anyone ever been able to negotiate down the buyers premium? The sellers has always been done, but never the buyers.

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11-14-2006, 10:32 AM

Posted By: WesleyThe contract says "a Buyer's premium of no less than 15%." Does anyone know whether the consignment contracts always said "a Buyer's premium of no less than 15%"? Or was a special contract only recently drawn up for the December consignors?

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11-14-2006, 10:51 AM

Posted By: Steve M.I think it would be more helpful to have a contract provision that states "no buyers premium "higher" than 15%".

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11-14-2006, 10:58 AM

Posted By: WesleyThat would be great, Steve. It would also be more straightforward. But that would only be more helpful for consignors, but not more helpful to Mastro. The way it is currently written, Mastro can actually raise the buyer fees to 20% or 25% or 30%. I am assuming that was the reason why it was left open-ended.

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11-14-2006, 11:37 AM

Posted By: Judge Dred (Fred)There are a few things to consider when you look to bid in an auction. Do you have to pay local sales tax? That tacks on a good 6%+ on the total. What is the return policy of the auction house. Some houses will tell you "NO RETURNS?". The buyers premium is only one thing that people should be looking at when they are biddin in an auction. What about people that use the ebay portal. Sometimes they tack on another 5% to bid via ebay. I would be willing to bet that some of the auction houses would be very negotiable with the sellers premium if the item(s) for sale were going to generate a lot of publicity and/or frenzied bidding. Mastro indicates "15%, period". Something tells me that period could be negotiable. The following is a list of auction houses with Buyers Premium / Sellers Premium as stated on their web sites. A "?" indicates that I couldn't find the amount on the web site. Lelands 15% / Negotiable Lipset 10% / 10% Sloate 15% / ? 19th Century Only 15% / ? Mastro 20% / 15% - period Hunt 15% / ? Collectible Classics 15% / ? REA 16% / ? Goodwing 17.5% / ? Clean Sweep ? / 10% if > $500, 15% if < $500 Huggins and Scott 15% / ? Memory Lane 15% / 10% - negotiable

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11-14-2006, 12:01 PM

Posted By: Griffin'sGoodwin is 0% on the seller.

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11-14-2006, 12:21 PM

Posted By: AnonymousCopied from Auctionreport.com <a href="http://www.auctionreport.com/auctionfees.htm" target="_new" rel="nofollow">http://www.auctionreport.com/auctionfees.htm</a>

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11-14-2006, 12:23 PM

Posted By: MikeGoodwin also takes credit cards, so 2-3% is also going to pay those fees.

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11-14-2006, 01:24 PM

Posted By: leonI just had a brief conversation with Doug Allen. We all assumed correctly why the increase was done. The consignor fees aren't what they used to be and it takes a certain amount of money to pay for the service Mastro gives. With that being said he does agree the timing was possibly not perfect, and we're not sure there is a perfect time. As I spoke with him I understand now that there was precedence of this kind of situation, timing and all, of other auction houses raising their BP. I am not saying that because someone else did something then it's necessarily right to do it too. I am saying they aren't the first to do it this way, from what I understand. I also will say personally that I don't think the timing was perfect either. If any consignor would like to speak with Doug about the situation he asked to give his cell # a call 630-336-6650. He can also be reached at the dallen@mastroauctions.com email address. best regards

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11-14-2006, 01:32 PM

Posted By: TONYI See some mentioned Heritage auctions of dallas, TX If memory serves me correct, Steve Ivy one of the owners was the first person to starting charging a buyers fee..... I believe it was only 5% at the time but of course, like the cost of a postage stamp that figure kept creeping up, to the ridiculous amount it is today..... Maybe someone one day will charge 50% fee to consign & a 50% fee to the buyer.......that way the auction houses can keep ALL the $$$$.........maybe then they will be happy

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11-14-2006, 01:36 PM

Posted By: Jeff LichtmanHey Leon -- what's the opposite of "perfect timing?" <img src="/images/happy.gif" height=14 width=14>

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11-14-2006, 02:30 PM

Posted By: Jeff Priznerperfect timing would have been right BEFORE taking consignments for this auction.

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11-14-2006, 03:41 PM

Posted By: Jeff LichtmanObviously the right thing to do is to refund every consignor the 5% that Mastro increased the BP - assuming the consignors weren't told of this change. Doug Allen indicated that the reason for the increase is due to the following: "This will ensure that we do not have to compromise in any way, with respect to conducting our auctions in the industry's most thorough, professional and efficient manner. ... We constantly apply this top-tier approach to every aspect of our business ... in the most painstaking authentication and cataloging process in the business." Hmmm. I guess Mastro didn't apply that "top-tier approach" when reviewing Scott's hat. Do you think possibly that the raise in BP had more to do with Mastro "ensuring that [they] do not have to compromise in any way" the income of its owners? Does anyone else read these excuses and not roll around laughing on the ground?

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11-14-2006, 04:17 PM

Posted By: warshawlawBut I'm not finding it very amusing to learn that I've just left another 2.5% on the table...

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11-14-2006, 05:12 PM

Posted By: AnonymousI was laughing pretty hard at that one too Jeff. ...also agree with the consignors feeling like they got hood-winked... ...but hey...all that flowery gobbly-gook language used to describe your item has to be worth something (if not priceless and/or inaccurate).

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11-14-2006, 05:18 PM

Posted By: Colt McClellandAnyone who consigned to this Mastro auction should pick up the phone and demand that Mastro reduce their seller's premium by the amount of the change in the buyer's premium. In fact, Mastro should have done this as a matter of course in advance in my opinion. The bottom line is this - add up your seller's premium and the buyer's premium and that is the "hit" that you are taking as a consignor. Mastro can call this an increase to the buyer's premium, but just like Leon points out a seasoned bidder is going to factor that into his bid. Thus, it's really coming out of the consignor's pocket at the end of the day. I've never been a fan of Mastro from a consignor's standpoint, and the way this was handled just enforces my opinion.

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11-14-2006, 05:23 PM

Posted By: Dan BrettaI'm not sure why you guys are complaining about the 5% left on the table before the auction is even underway. With that said I personally would rather consign my items to an auction house that is open to more bidders than Mastro's Premier auctions. And just taking a look at some of the opening bids on some of the items I think that's going to scare off even more bidders. $1500 opening bid on a photo of Walter Johnson shaking hands with Christy Mathewson???

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11-14-2006, 08:51 PM

Posted By: AnonymousColt, Why would they refund anyone 5% they only raised the fees from 17.5 to 20% which is 2.5%. did not see the edit

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11-14-2006, 09:25 PM

Posted By: Judge Dred (Fred)REA = 16% BP Goodwin = 17.5% BP Mastro = 20% BP Most others are 15% BP. Lew Lipset seems to be the auction house with the least amount not going to the house. Lew is at 20% total for the BP + SP.

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11-14-2006, 09:53 PM

Posted By: cmokingGoodwin is 0% Seller's Premium + 17.5% Buyer's Premium. For a total of 17.5%. That also includes no haggling, no hassles, and no problems - at least based on my experience.

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11-15-2006, 04:34 AM

Posted By: Jeff LichtmanKing, how can Goodwin manage then to "ensure that they do not have to compromise in any way, with respect to conducting their auctions in the industry's most thorough, professional and efficient manner"? It must be "painstaking."

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11-15-2006, 05:10 AM

Posted By: leonSometimes when you are doing something to make extra money it's good say you are doing it to make some extra money......The rest of it is justification, or not, but the reason stays the same.

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11-15-2006, 06:59 AM

Posted By: Dan BrettaI don't know anything about Goodwin, but I have seen the Mastro headquarters in person and I can tell you that they have a lot of employees, a very nice secure building and a first class operation. I'm not trying to defend Mastro here because I think it was really crappy timing and they should have told consigners that this was coming....I'm just saying Mastronet can't be cheap to run.

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11-15-2006, 08:11 AM

Posted By: JimBDan, I think you will find with a little investigation that Mastro's opening bids are usually ridiculously low - mostly around 10-25% of what the items actually sell for. JimB

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11-15-2006, 11:49 AM

Posted By: Colt McClellandI think we all know that Matro is a hugely profitable business. All of that bs about running a big first-class operation, producing the catalog, etc. just amounts to a fixed overhead number which can't really have changed much over the last several years. The bottom line is that they clearly make a huge profit and this increase will likely add to that. I say "likely add to that" because I think there is clearly a "tipping point" out there whereby if they get too greedy and raise the percentages too high, they will start to see the size of their auctions go down. They may be getting close to that point now. My guess is that they will continue to inch this thing up until they hit that point, then maybe either stay level or back it off a bit.

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11-15-2006, 12:17 PM

Posted By: leonI certainly agree with you on some of what you say...but "hugely profitable" is a relative term. Let's say they do 50 million a year in sales...which is probably close. If they make 23% gross margin (again, probably close)...then the total GP is $11,500,000 ...which is a lot of money but then you have to take out expenses. All of this is hypothetical but I am sure somewhere in the ballpark, relatively speaking. Let's say they have 30 employees....and their payroll is 75k ea...again, some high and some low....that's a 2.25 million dollar payroll. That's 9.25 million left over. Let's say they have another 3 million in total expenses...with advertising, printing, mortgage, etc...that again could be in the ballpark, maybe low. So now we have around 6 million a year as a net profit, before taxes which would make them very profitable but not like ExxonMobil or Wal-Mart. In the long run the market will dictate a lot of what is done. As I said before I will just factor in the extra percentage when bidding. best regards...your money grubbing Wh*** edited for spelling but I still am no English major....

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11-15-2006, 12:28 PM

Posted By: warshawlawCost to consign: 35% <img src="/images/sad.gif" height=14 width=14> Cost of watching straight men use the word "fabulous" in auction descriptions: priceless. <img src="/images/happy.gif" height=14 width=14>

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11-15-2006, 12:41 PM

Posted By: Steve M.Yes Leon, that's nice money. But you know it's kind of like being a pro athelete . The career span is so short that they have to make it while they can. I suspect that Mastro may be doing just that. Several factors weigh heavily on his business. 1. There is a lot more competition; and 2. Can the collecting market continue at this torrid pace?

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11-15-2006, 12:48 PM

Posted By: Jeff LichtmanLeon, I acutally laughed out loud reading the very end of your last post...

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11-15-2006, 05:53 PM

Posted By: Colt McClellandLeon, Even based on your analysis, I would still consider that to be a huge profit relative to the number of "owners" who share in it. I don't know the ownership situation for Mastro, but I would guess that the list of shareholders is relatively short and that they are each making what most on this board would consider to be a huge amount of money from the business. ExxonMobile and the like divide their profits up between millions of shares so the relative profit for an "owner" is much less. That's what I meant by a huge profit. I was speaking relative to what those on this board might consider to be profitable for a closely held business that they were participatin in. Just clarifying my postiion.

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11-15-2006, 06:37 PM

Posted By: Jeff LichtmanHey, we're all capitalists here (save the Behrens boys); it's ok to make money. I just find it hilarious how Mastro is obviously the greediest of all of the auction houses yet takes the greatest pains to explain away its greed by claiming that all of the increases in costs are for the bidders' own good. Enough with the BS already.

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11-15-2006, 07:00 PM

Posted By: Dan Kotelescan you find the material they produce constantly much or anywhere else?....very little and definetely not on ebay. There are some very intelligent buyers that know where to stop and there are many with enough money that dont care to stop. Usually the bigger bankbbook wins out on these auctions in which they are primarily geared for. The best thing is that if you dont have much to spend focus on 1 or 2 lots that you really want and hope to win one. Dont expect a Wagner with a 25k annual income. This is what I mean by knowing when to stop. In competition ,there is always a winner and always a loser. Better luck on the next REA or other auctions ahead.

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11-15-2006, 07:11 PM

Posted By: Judge Dred (Fred)I was talking to a friend today and we got on the subject of the Mastro auctions going to a 20% BP. My friend made a lot of sense, he indicated that it could be that they may take less from the seller (seller's premium) so that they can get the consignments and they are making up the difference (of lower seller premiums) through an increase in the BP. This would allow them to continue to get nice material (lower seller's premium) and still keep their margin by having the buyer pay for it. There is a finite supply of cards so getting the cards in a highly competitive market may take negotiating lower seller premiums. I suppose the bottom line is that you should factor the BP into the bid amount. 20% is a pretty big chunk. We can only hope that the other auction houses with less overhead don't follow suit in raising their BPs.

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11-15-2006, 07:17 PM

Posted By: cmokingFred, the problem is not the hike to 20%. The problem is that consignors in their December auction feel bamboozled because they were not told the BP would be raised to 20%. From the Mastro contract, it sounds like Mastro is covered as they state the BP will be at least 15%. 20% is at least 15%. But many consignors still feel it was unfair. I agree with them.

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11-15-2006, 07:25 PM

Posted By: LarryMastro Auctions still is the best auction as far as the most diversified supply of quality auction material, they can charge anything they deem reasonable, just adjust your bidding to factor in the 20% or if you are not happy, just do not bid, this is the world of Corporate America. Luckily they do have competition so at least collectors have choices. They still have a lot of overhead and are not as profitable as everyone thinks in ratio to the volume they do. This thread reminds me about the e bayers that complain that they pay $5 for an insured graded card(value $50)packed in bubble with insurance and delivery confirmation from a fast shipping seller and think a seller should charge $2(cost), well overhead and shipping supplies have gone way up, so has insurance, travel expenses etc. and it does not come FREE....Doug Allen maybe could have done this AFTER the auction and for those that did consign prior, I do agree they have a valid complaint for this auction, however you can pull your listing if you do not want them to carry it out if it is such a problem. They still are a wealth of information, quality and service to the hobby.

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11-15-2006, 07:25 PM

Posted By: Judge Dred (Fred)King, I absolutely agree with you about the consignors. The fair thing to do would be to allow a consignor to withdraw their lot (without penalty) if they were under the impression the BP was going to be lower. I suppose one fair compromise would be to lower the SP for those that want to withdraw their lots. One thing to remember is that we all realize that there are very few bargains in the Mastronet auctions therefore the rational is that Mastronet auctions do garnish some of the most spirited bidding amongst the large auction houses. If someone were to withdraw their lot then they would be banking on getting a few percent more from another large auction house. We'll see how it all plays out. The guys at Mastronet are pretty good people so they'll probably do something to make things right for the consignors that feel slighted.

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11-15-2006, 07:59 PM

Posted By: jay behrensI am a capitalist, but I believe that personal moral and ethics should not be tossed out the window in the pursuit of the all mighty dollar. This is why none of my business ventures have been huge successes. I lack the ability to screw someone over, or lie to someone to make a buck. When it comes to money, people will do things in the pursuit of a buck that they would never consider doing if it was a personal situation. Jay I love pinatas. You get to beat the crap of something and get rewarded with candy.

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11-15-2006, 08:08 PM

Posted By: Jeff LichtmanWhat some of you guys are not getting is that increasing the BP by percentage points only serves to reduce the seller's final take. So, it is a fiction that if Mastro reduces the consigment fee by x points but just increases the buyer's fee by the same x points that the seller is making out better. Clearly, buyers factor in the increased BP when making bids - thus reducing bids and costing the seller.

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11-15-2006, 08:13 PM

Posted By: leonNot sure which way your finger was pointing <img src="/images/happy.gif" height=14 width=14> but I never said that I didn't think the consignor could be out something. Doug Allen told me that if any consignor has an issue they should call him to resolve it. What more could be said, that hasn't been? I think they run a fine outfit and have expressed my opinion, on this matter, elsewhere too.

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11-15-2006, 08:15 PM

Posted By: David VarghaI do agree they have a valid complaint for this auction, however you can pull your listing if you do not want them to carry it out if it is such a problem. I didn't think that they contractually had this option. DavidVargha@hotmail.com

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11-15-2006, 08:20 PM

Posted By: Judge Dred (Fred)Jeff, My statements regarding BP and SP weren't meant to indicate that the auction is going to be better for the seller. My intentions were to show that the final cut for the auction house would be the same, but the buyer would end up paying more for the item. My point was that this material isn't getting easier to find and the auction houses have to get the owners of the material to sell it so enticing them with lower SPs may help out. I understand your point of view. The higher BP lowers the overall final realized price because bidders will drop their bids a few percent to make up the difference for the increased BP. A lot of buyers get caught up in the auction and sometimes that extra BP% may not be a final factor in their bidding. As for me I usually don't get caught up in the bidding frenzy. I'll pay what I feel is a good fit for me. If I get outbid (and that is the norm for me) then I just don't get the item. Edited to add a SMILEY FACE <img src="/images/happy.gif" height=14 width=14> - I believe everyone is entitled to their opinion...

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11-15-2006, 08:37 PM

Posted By: JayKing is exactly right on this issue. The point isn't that Mastro chose to increase their buyer's premium. Buyers can factor that into their bidding and sellers can negotiate their seller's commissions accordingly. If this change was announced effective the next major auction then I would say it is a non issue. The fact that Mastro increased the buyer's premium without telling consignors to the December major auction and, on lower value material, to the February smaller auction was, in my opinion, just a slap in the face to consignors. This 2.5% increase spread over possible realizations of $16 million on these two auctions would generate another $400,000 for Mastro. My guess is that in the long run this move will cost them alot more than that. I would hope that they would reconsider and rescind this move.

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11-16-2006, 06:36 AM

Posted By: warshawlawMastro had the contractual right to raise the BP; I don't think anyone will win a debate over that question. The issue is whether it is a maneuver that was timed so as to not allow consignors discretion to not deal with them, which it undoubtedly was. Next time I consign, I will negotiate an overall cap to my commission and the BP instead of merely the commission.

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11-16-2006, 06:52 AM

Posted By: Jeff PriznerGood point Adam! Next time I consign, I will do the same. Seriously doubt I'll ever be consigning to Mastro again though. As for Doug making good with consignors, I'll believe it when I see it. (Still waiting for him to call me back). But from the conversations that I have had with other consignors who have already spoken to him, I won't be holding my breath.

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11-16-2006, 06:58 AM

Posted By: barrysloateIt certainly appears after the number of posts that Mastro made a public relations gaffe, but once they get through this auction the 20% will be information that everyone will have at their disposable. Not necesarily wrong to charge 20%; as has been said bidders will factor this in. But announcing it after all consignments are in is clearly a mistake, and if we know it by now they surely know it too.

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11-16-2006, 06:59 AM

Posted By: Jeffrey LichtmanJeff-what is Mastro's official position regarding their bait and switch?

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11-16-2006, 07:55 AM

Posted By: Bruce Dorskind The real question for a seller is "where will I realize the maximum amount of money for the items that I am selling? If I sell through Auction House A and pay no seller's premium and they have a 10% Buyer's Premium and I realize a 1000 on an item that is fine. If Auction House B can sell the same item for $1300 and I have to pay them 10% and there is also a 20% Buyer's premium ($1300 becomes $1560) as a seller I am still better off with Auction House B. The big question is how much additional value does an auction house that charges 15%and 20% (sellers and buyers premium) add vis a vis one that charges 0 and 15% or 10% and 10%. I think that the answer is determined by the item. As for seller's premiums, I have been offered a negative premium ( a share of the buyer's premium) by two of the most distinguished auction houses. This is very typical of the coin business- where it is rare for a coin auctioneer to charge a seller's premium on high quality graded material. My experiences with Robert Edward as both a buyer and a seller is that they have been worth every percentage they charged. Rob Lifson is a savvy business executive and is more than reasonable if the collection warrants an adjustment in the seller's premium. While Mastro has every right to charge a 20% premium they are obligated morally, if not legallly, to notify consignors of a change in terms. in advance of accepting the items. It is very poor form and highly unprofessional to do otherwise. It takes 20 years to build a reputation and 20 minutes to ruin it. Bruce Dorskind America's Toughest Want List

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11-16-2006, 08:15 AM

Posted By: Jeff LichtmanBruce, thanks for that post - very informative. Negative premium...unreal.

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11-16-2006, 08:15 AM

Posted By: davidis there any language in the consignment contract that would allow for the seller to request an item be pulled? it seems as though the terms under which the contract was signed and under which the items will be auctioned have changed

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11-16-2006, 09:08 AM

Posted By: Jeff PriznerI'm still waiting for Doug to call me back, but from what others have told me, their stance is basically the same as what their email said. So they don't have to compromise their professional and efficient manner, expensive catalogs and authentication, and blah, blah, blah... Raise your fees to whatever it takes to cover expenses, but inform your consignors before sending out contracts, not on the same day as the auction starts!

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11-16-2006, 09:13 AM

Posted By: Jeff Priznerthe contract is worded "We will also charge the Buyer a premium of no less than 15%" Legally they can charge whatever BP they want, just think the timing of the announcement was very unprofessional and somewhat unscrupulous, in regards to how it effects consignors for this auction.

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11-16-2006, 09:27 AM

Posted By: Jeff LichtmanSo Doug doesn't explain why they failed to inform consignors until AFTER the catalogues were printed and mailed, on the eve of the auction? All consignors should, en masse, threaten to withdraw their lots at this late time (if their contract allows for it). I guarantee that will get Mastro to cut their seller's fee by 2.5%. (God forbid Mastro should cut back the buyer's premium to the 17.5% figure -- the previously highest fee charged in the auction world) Well, at least you can't accuse Mastro of not being groundbreaking in some aspects of its auctions....

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11-16-2006, 09:32 AM

Posted By: ramramdelete - wrong thread

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11-16-2006, 09:35 AM

Posted By: Griffins<<(God forbid Mastro should cut back the buyer's premium to the 17.5% figure -- the previously highest fee charged in the auction world)>> Heritage is 19.5% and SCP/Sotheby's is 20%. Plus 5% if they run it thru ebay live.

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11-16-2006, 09:39 AM

Posted By: David VarghaJust to clarify my earlier post Jeff, "they" referred to the consignors (not Mastro). DavidVargha@hotmail.com

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11-16-2006, 09:51 AM

Posted By: warshawlawBruce: interesting insight. If the evil day comes when the whole collection goes on the block, I will not only demand a 0 commission, I will try to take a bite out of the BP too. I hear a lot of talk of boycotts but I suspect that since such things are not subject to policing, in the end everyone will show up and Mastro will report yet another record sale.

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11-16-2006, 09:55 AM

Posted By: Judge Dred (Fred)Build it, they will come = Offer it, they will bid

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11-16-2006, 10:51 AM

Posted By: leonYou hit the nail on the head. From personal experience it doesn't matter what anyone or any company does, if someone wants a card.....most of the times they don't care what the seller did/does. Sad but true....I won't deal with a few people for the way I was treated but for the most part people just don't care.. You could be a thief, liar, scoundrel, pervert (maybe)....but if you have a card someone needs...they don't care what else you did. Mastro gives good service, has great items, and had poor timing...this will blow over (for most) about the last day of their current auction, imo... regards

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11-16-2006, 11:10 AM

Posted By: DJFred did hit on the nail of the head. It's like when you hit the thruway and your starving and you have to hit a fast food joint en route. The first thing you do is comment about how a Big Mac by your house is $2.79 and here it is $3.19. You still eat though. How many of us (not me) said they would never deal with Lelands because they sold parts from Munson's plane? C'mon, it's the shock and emotion of the high percentage raise, but if you want it and it's there, it may be yours regardless of how you feel at this current moment. DJ

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11-16-2006, 11:42 AM

Posted By: Jeff PriznerFrom a bidder's POV, no big deal, and yes, it will blow over. From a consignor's, this personally won't blow over for me. I won't consign to them again.

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11-16-2006, 01:57 PM

Posted By: davidcyclebackMy opinion is the auction houses should charge the consignors, as there should be some semblence of balances in buyer/consignor charges. 100%/0% 'balance' in most anything isn't a good idea. Also, consignors who negotiate 0% consignment fees should not with a straight face complain about the 20% winner's fee-- as the winner's fee is more than likely raised due to the dissapearing consignment fees.

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11-16-2006, 02:11 PM

Posted By: Jeff PriznerI'm all for charging the consignors, and 20% is fine if that's what they need to do. But to announce it AFTER all the consignments have been accepted at the presumed 17.5% is what I have a problem with. 2.5% isn't a huge amount of money, but it's the principle of it. I've always held Mastro in the highest regards, that changed somewhat this week.

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11-16-2006, 02:20 PM

Posted By: WesleyI understand what you are saying, Jeff, and I think most people feel the same way. If this announcement was made four months ago, then it would be no big deal at all. But the fact that Mastro introduced the higher fees in the same email as the one announcing that the auction is now online is bad business practice. I don't think you will find anyone who does not work for Mastro that disagrees with this.

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11-16-2006, 02:25 PM

Posted By: Harry Wallace (HW)Jeff, Well said. I do not think it is a problem that they raised the buyer's premium, it is how they did it that is not right. Heritage and Sotheby's and Sportscards Plus are all at 20% and I think Mastro's product is superior to theirs. It is the fact that they changed it without a warning is what is not right. There again, everyone else has edged their buyer's premiums up over time and I do not remember being notified in advance by them either.