Buyers premium question

[Snapolit1]

I understand that in many/most large auctions the AH owns some number of items flat out. I've seen buried in terms and conditions a provision that if you want to know which lots we own just drop us a line and we'll send you a list. Putting aside the question of why this info isn't openly disclosed, why should the AH collect a buyer's premium if they are already collecting 100% of the sales price and putting it in their pocket? Realize I'm whistling in the wind here, but isn't the whole idea of a buyer's commission is it's how the AH makes money when they are brokering OTHER people's property?

[nat]

If there was no buyer's premium the bids on those items would just go up. If an item is worth $X to you, it's worth $X to you, no matter whether the X is split between the seller and the AH, or whether the AH takes all of it.

[glchen]

Auction houses still want to try to maximize as much revenue as possible so that's why they would still charge the BP. Also, it may be confusing to some bidders on which lots have BP and which don't. Finally, for some auctions, it's not only the AH that owns the lots, but also some employees who decide to consign their items. For the employees, it's likely that the AH would still charge them a portion of the BP.

[Exhibitman]

The only reason to have a separate BP rather than just take a cut of the final price is to take advantage of bidders who can't do math or don't remember that there is a BP. Given what I've seen on this site in the past when discussions of AH compensation have come up, the tactic probably works to some degree, because there clearly are some people who do not understand that the price of the item is price + BP and you have to bid accordingly.

Not directed at the OP or other responders here.

[Snapolit1]

Originally Posted by Exhibitman

The only reason to have a separate BP rather than just take a cut of the final price is to take advantage of bidders who can't do math or don't remember that there is a BP. Given what I've seen on this site in the past when discussions of AH compensation have come up, the tactic probably works to some degree, because there clearly are some people who do not understand that the price of the item is price + BP and you have to bid accordingly.

Not directed at the OP or other responders here.

I think for many of us when you get caught up in the chase of really really wanting something it's easy to "forget" about the premium when bidding. I think that's human nature. Probably why most AH's don't show you what the actual purchase price was including premium till you get their bill.

[Peter_Spaeth]

Originally Posted by Snapolit1

I think for many of us when you get caught up in the chase of really really wanting something it's easy to "forget" about the premium when bidding. I think that's human nature. Probably why most AH's don't show you what the actual purchase price was including premium till you get their bill.

I really don't understand this. Every auction house on earth has a substantial buyer's premium. I don't see how anyone could "forget" it.

[drcy]

That an employee consigns something from his personal collection doesn't equate with the auction house itself making money off it, unless there's a a charge. An ethical auction house may say an employee can consign something, but (for ethical/fairness reasons) there has to be the normal charges-- they don't get an advantage just because they're employees.

[bigfish]

Originally Posted by Snapolit1

I understand that in many/most large auctions the AH owns some number of items flat out. I've seen buried in terms and conditions a provision that if you want to know which lots we own just drop us a line and we'll send you a list. Putting aside the question of why this info isn't openly disclosed, why should the AH collect a buyer's premium if they are already collecting 100% of the sales price and putting it in their pocket? Realize I'm whistling in the wind here, but isn't the whole idea of a buyer's commission is it's how the AH makes money when they are brokering OTHER people's property?

I haven't given this very much thought and don't care who owns the item. I bid what I want to pay....

[familytoad]

Sam, you pegged it with a simple three letter word

The BP or SP or some combination of that is just the tip!

Like buying a fine meal, you just tip at the end and your price goes way up but somehow you feel okay. And the waiters (AH) get the money.

[mechanicalman]

Originally Posted by familytoad

Sam, you pegged it with a simple three letter word

The BP or SP or some combination of that is just the tip!

Like buying a fine meal, you just tip at the end and your price goes way up but somehow you feel okay. And the waiters (AH) get the money.

Lol. Maybe that is a good way to think about it. I just wish my catalog tasted like a perfectly cooked T-bone.