AH Blues

[Peter_Spaeth]

If an AH had a 10 percent seller's fee and no buyer's premium, my guess is they would do just fine getting consignments.

[sb1]

Peter,

I think it would be an uphill battle for anyone trying to go that route at this point in time.

The buyer is the end consumer and would be happy to pay no fee, but the consignor/seller would not be so willing to pay 10% off the top when he could call the next guy and pay nothing. So again no consignments, no auction. It would take the majority of AH's making this change all at once to make this even plausible, and then one gets short of material and they are back to offering Zero consignor fees. Today's setup is just free market working it's way in the sports AH world.

I might add that the only way you would be able to garner more seller interest in having a consignor fee would be the premise of a bigger payout due to the AH being able to get more money for the client, which is where many/most of the problems of the AH's began with trying to get higher prices than their competitors, which in fact were not always legit sales/bids as we now know.

[Peter_Spaeth]

Originally Posted by sb1

Peter,

I think it would be an uphill battle for anyone trying to go that route at this point in time.

The buyer is the end consumer and would be happy to pay no fee, but the consignor/seller would not be so willing to pay 10% off the top when he could call the next guy and pay nothing. So again no consignments, no auction. It would take the majority of AH's making this change all at once to make this even plausible, and then one gets short of material and they are back to offering Zero consignor fees. Today's setup is just free market working it's way in the sports AH world.

I might add that the only way you would be able to garner more seller interest in having a consignor fee would be the premise of a bigger payout due to the AH being able to get more money for the client, which is where many/most of the problems of the AH's began with trying to get higher prices than their competitors, which in fact were not always legit sales/bids as we now know.

I don't get it. Any knowledgeable consignor would realize he is going to do better with (using my example) the AH getting a total of 10 percent of the take than with the AH getting 20, regardless of the semantics. It's just the flip side of the buyer's calculus. Even with no seller's fee the consignor isn't paying nothing, he is paying in the form of a reduced hammer price due to BP.

[sb1]

You are correct with the math, but people are not as comfortable with change as a whole and very resistant when they perceive that they are the one paying the tab. It's all psychological for most of them.

I agree, if you told me I got 90% of the take instead of 80% in the end, A. is the better option.

I would add that the larger houses would probably need much more than 10% for their cut to make it work out with larger overhead and that throws a wrench in the works and now you are back to 15-18%(minimally) for a sellers fee and the consignors just won't go for it.

As you know I charge 12 1/2% bp and no sellers fee. My biggest point to consignors is that they are netting 87 1/2% of each item(hammer+bp), which is more dollar in their pocket versus AH that charge 15-23%.

[Peter_Spaeth]

Originally Posted by sb1

You are correct with the math, but people are not as comfortable with change as a whole and very resistant when they perceive that they are the one paying the tab. It's all psychological for most of them.

I agree, if you told me I got 90% of the take instead of 80% in the end, A. is the better option.

Then if you are right why are people consigning in droves to PWCC, where the fee clearly comes directly out of the sales price? After all they could go to an AH for free.

[sb1]

Some of them are much more ebay users and not even aware of most AH's, PWCC has done a great job of marketing themselves to that niche of clients, so they are more comfortable with the venue. I would say the ebay world and AH world are largely two different groups, both when buying and selling.

[Peter_Spaeth]

Originally Posted by sb1

Some of them are much more ebay users and not even aware of most AH's, PWCC has done a great job of marketing themselves to that niche of clients, so they are more comfortable with the venue. I would say the ebay world and AH world are largely two different groups, both when buying and selling.

My guess would be that those worlds are not so dramatically separate any more.

[Peter_Spaeth]

Originally Posted by sb1

You are correct with the math, but people are not as comfortable with change as a whole and very resistant when they perceive that they are the one paying the tab. It's all psychological for most of them.

I agree, if you told me I got 90% of the take instead of 80% in the end, A. is the better option.

I would add that the larger houses would probably need much more than 10% for their cut to make it work out with larger overhead and that throws a wrench in the works and now you are back to 15-18%(minimally) for a sellers fee and the consignors just won't go for it.

As you know I charge 12 1/2% bp and no sellers fee. My biggest point to consignors is that they are netting 87 1/2% of each item(hammer+bp), which is more dollar in their pocket versus AH that charge 15-23%.

Exactly Scott. What matters is the AH's total take. You are making my point, I think.

[x2drich2000]

Peter, you are absolutely right it should not make a difference as long as the auction house is making the same commission and the consignor is getting the same amount. However, that is assuming everyone is rational, which is definitely not the case and where psychology plays a big role. As an example, when you shop online, which do you buy, an item for $10 with free shipping, or the same item for $8 and $2 shipping? Both are the same item, both cost you the same, but more people will choose the $10 with free shipping cause the price structure is simpler to understand and people are drawn to the word "free" (who doesn't like free stuff?). Obviously if the commission is not the same or the consignor is not getting the same amount, then one option is definitely better.

DJ

[sb1]

Precisely, it's all in the eye of ones perception. You can lay out several scenarios of your choosing with the same outcome, and people's choices of a, b, or c. will be greatly varied as to how to get there, even though it's the same ending.

[Fballguy]

Originally Posted by sb1

Peter,

The buyer is the end consumer and would be happy to pay no fee, but the consignor/seller would not be so willing to pay 10% off the top when he could call the next guy and pay nothing.

Why? It's all the same money isn't it? Isn't the seller going to be ecstatic to know that his bids won't be suppressed? If there's no 10% BP, that means the seller will realize 10% higher bids!

Don't believe me? Just read this thread.

[leaflover]

Winning a card at an auction is like winning a horse race. You pay the "juice".
With sports betting the loser pays the "juice".

[Aquarian Sports Cards]

Originally Posted by Peter_Spaeth

If an AH had a 10 percent seller's fee and no buyer's premium, my guess is they would do just fine getting consignments.

Maybe, but they'd go out of business!