Huggins and Scott Announces New Buyers Premium Concept

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Posted By: Josh Wulkan

First, we would like to wish each of you a very Happy New Year. With the new year, we are also making a change with a revolutionary concept to the internet/catalog auction industry. This idea is going to benefit both bidders and consignors, by saving bidders money and putting more money in our consignors pocket.

Beginning with our upcoming Winter Auction that begins on January 18th and ends February 4-5, 2009, we will be implementing a tiered buyers premium. The more an item sells for, the less the buyers premium for that item will be. The scale will be as follows:

When the hammer price for a particular lot is:

under $1,300 - add a 17-1/2% premium;
between $1,300 - $4,750 - 15% premium;
between $5,000 - $9,500 - a 12-1/2% premium;
between $10,000 - $24,000 - a 10% premium;
between $25,000 - $47,500 - a 7-1/2% premium
$50,000 or more - a 5% buyers premium will be added to the final bid price.

Huggins and Scott gets a bit from both sides, but the more an item sells for, the less the auction company needs. Bidders and consignors should find this new idea extremely appealing.

We are always looking for new, creative ideas to help this industry grow for the better and this is just one way that we feel we can get more money for our consignors and allow our bidders to save money on higher dollar items.

We hope that you will find this idea as beneficial as we do, especially on items that will sell for a higher hammer price. The bidder will save money and be able to place a higher bid and the consignor will get more money because they are getting their commission based on the hammer price. Everyone wins!

thank you and if you have any questions, please feel free to email us or give us a call.

Huggins and Scott Auctions
301-608-0355
auction@hugginsandscott.com
www.hugginsandscott.com

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Posted By: barrysloate

Excellent idea. It does make bookkeeping more complicated, but it should make buyers and sellers happy.

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Posted By: Fred C

Josh,

You know you opened yourself up for this one...

Does that mean there is no buyers premium if the hammer price is:

• between $4,751 and $4,999
  
• between $9,501 and $9,999
  
• between $24,001 and $24,999
  
• between $47,501 and $49,999
  

Sorry, if I didn't do it, someone else would have...

Nice concept!

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Posted By: Josh Wulkan

Actually, we do not have bid options at those price values. There is no way that a lot can end on the numbers you are asking about because they are not one of our bid price options.

Josh

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Posted By: Joann

Good for H/S. I just finished reading the email on the same topic and thought to myself that it is nice to see an auction house that's willing to move things around a little instead of adamantly refusing to go anything but higher.

So good for H/S for having the guts to move, and good for all of the auction houses that maintain reasonable BF's.

Joann

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Posted By: Michael Steele

I do like the sliding scale. It is a great way to induce higher ticket items. I think most other auction houses may adopt this over time. In reality, the consignment fee side of this is already working the same scale because as we know, some houses will lower or waive the fee for higher ticket items.

The only small negative is the buyer or seller that deals with items under 1300 or so as the rate goes up 2.5% which impacts bidding but 17.5 is still in line with the industry. Disclaimer: I do not work for H&S but consider them a fine auction house.

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Posted By: Matt

This is a fantastic concept and I hope other houses follow suit. It makes quite a bit of common sense.

My Trade/Sale Page

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Posted By: Fred C

Josh,

Now I get it!

Nice idea, I hope it catches on with the other auction houses.

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Posted By: David

So, if an item sells for $1400, then do you pay the 17.5% on the first $1300 and then 15% on the last $100?

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Posted By: Josh Wulkan

David,
nope. The buyers premium is added to the ending hammer price. If an item hammers for $1400, the buyers premium that will be added to that item is 15%.
Hope that helps.
Josh