|
More bad news for Mastro
Posted By: <b>Dan Bretta</b><p>REA is likely expanding to two auctions per year. With Mastro's recent problems this just adds to the challenge they will have trying to attract consignors.
|
More bad news for Mastro
Posted By: <b>Fred C</b><p>Dan,<br><br>Can you do me a favor and tell me what problems Mastro is having? If I can avoid filtering through a huge threade it would be greatly appreciated. I read something about a cash flow problem or federal activity or some other things like that. <br><br>Thanks!
|
More bad news for Mastro
Posted By: <b>Joe D.</b><p>I would enjoy an REA auction every month.<br><br>I really like their auction.<br><br>
|
More bad news for Mastro
Posted By: <b>rand</b><p>they are way behind in paying consignors. supposedly they may be just getting to the live auction people now, and have sent a letter saying it will be at least another week.
|
More bad news for Mastro
Posted By: <b>Dan Bretta</b><p>Fred, a few things...<br><br>Fact: They are under federal investigation.<br>Fact: They are having problems paying consignors.<br>Rumor: They laid off 15-17 employees yesterday.
|
More bad news for Mastro
Posted By: <b>Jeff Lichtman</b><p>Fact: They've run out of that cool packing tape that always made me so happy.
|
More bad news for Mastro
Posted By: <b>Rob</b><p>I think thats what makes REA so good though, is that they spend an entire year acquiring material and have a kick-@$$ auction. Would be tough, i think, to have such great material EVERY auction if they were to expand too much.<br><br>
|
More bad news for Mastro
Posted By: <b>Matt</b><p>The email REA just sent said that the 2nd offering will probably start out as a smaller offering and not another huge one like the April offering.<br><br><br>Here is the full text:<br><br>"Having heard repeatedly during the past week numerous reports of serious economic issues at some auction houses, we thought it would be appropriate to send a quick note to our bidders and consignors to assure you that Robert Edward Auctions is rock solid financially, as always, and that interest in collecting is as great as ever. We have no cash flow problems, and no banking credit issues. In fact, as we have communicated many times in the past in our advertising literature, REA does not even have a line of credit. We dont need one. The hobby is healthy and collectors are very enthusiastic! The economy may have an impact on the prices of some items, that is a given (and as it should be), but interest in our auctions, both by bidders and consignors, is unprecedented. It would not be an exaggeration for us to say that, from our perspective, business is booming.<br><br>While the flow of quality consignments is always uncertain and by nature feast or famine, it is clear to us that there is a far greater demand for our services than we can supply. We always tell consignors that our most valuable resource is our time. The way we do things, with uncompromising care, commitment to research, and attention to detail, there will always be a limit on exactly how much material we can process and therefore accept for auction. Thats why we always ask for material early. We could not do the quality job we insist on doing if everything came in at the last minute. It would be impossible. We will never compromise on the quality of our services, and if we have to turn down material for auction, were OK with this being the reason. We want to do a great job. <br><br>In recent years it has become routine for us to have to politely decline to accept quality items because of timing. This has increasingly been the case even as we have cut back drastically on our advertising. This year we didnt even send out a direct mailing request for consignments, and you (as a person on our email list) may or may not have noticed that we have sent out just a few consignment request notices by email the entire year. The reason we havent been more aggressive with advertising is simply that we have been swamped all year. This tells us that maybe this is the time for us to consider expanding to two auctions per year. We dont know the exact details yet, because they have not been decided (we first have to get through the upcoming auction, which is going to press in a few weeks) but many collectors and dealers have suggested that we go to two auctions per year, and we are finally very seriously considering doing exactly that. We will send more details soon. Our vision may be to add a smaller second auction, as opposed to trying to create two auctions of equal size, with the idea that maybe over time the second auction will grow into an event as significant as the larger auction. Even if it does not, it will allow us to handle more material for more consignors, possibly allow us to attract some quality consignments that we would not otherwise get, and to provide a shorter time horizon for auction that is often desired by sellers. The goal is to allow us to provide an even more valuable service to the collecting community, while at the same time being careful and practical. At REA, we like what we do very much and want to be sure to keep the auction business fun for us! We will keep you posted and look forward to sending more details in the near future about this and about our upcoming auction, which may be our best ever!<br><br>Sincerely,<br><br>Robert Edward Auctions LLC"<br><br><br><br><br><br><a href="http://picasaweb.google.com/mwieder" rel="nofollow">My Trade/Sale Page</a>
|
More bad news for Mastro
Posted By: <b>barrysloate</b><p>Oh my god, noooooo...not the packing tape!<br><br>The other stuff I can deal with.
|
More bad news for Mastro
Posted By: <b>travis</b><p>when is the next REA auction actually????Thanks
|
More bad news for Mastro
Posted By: <b>barrysloate</b><p>It usually closes around last week of April- May 1, give or take a few days.
|
More bad news for Mastro
Posted By: <b>rand</b><p>wow, that was quite a letter. mastro has no comment, silence is not a good thing sometimes. i dont think the next mastro auction is going to get many consignors, if REA gets a 2nd auction in this year they will pick up a ton of that stuff. hmmmm
|
More bad news for Mastro
Posted By: <b>Cat</b><p>"Rumor: They laid off 15-17 employees yesterday."<br><br><br><br>Is it just me, or do others think: why the hell did Mastro have 15 to 17 employees in the first place?
|
More bad news for Mastro
Posted By: <b>barrysloate</b><p>Cat- they typically had about 40 employees. I always felt that was too many. But they don't consult with me.
|
More bad news for Mastro
Posted By: <b>Fred C</b><p>Dan,<br><br>Thanks!
|
More bad news for Mastro
Posted By: <b>DJ</b><p>Just viewed the Classic Collector online. Never thought that a New York Yankees jersey "" to common player Stan Jefferson would ever be a lot for them. He did play 10 games for them in 1989. Or a Kelly Gruber Orioles jersey that was used his final season (during a comeback) where he didn't even play that season. Also, did they lay off those writing the descriptions? <br><br>As far as the above issues at hand, are other auction houses facing similar issues? <br><br>It seems like auction houses really don't like paying their consignors..or at least in a timely fashion.<br><br>DJ
|
More bad news for Mastro
Posted By: <b>Cat</b><p>"Cat- they typically had about 40 employees. I always felt that was too many. But they don't consult with me."<br><br>They should have consulted with you, but something tells me that it is to late now!
|
More bad news for Mastro
Posted By: <b>Bob C.</b><p><br>Thought I would chime in here. A certain significant collector with whom I have traded with for several years has decided to consign a large portion of his collection with Robert Edwards. Should be some interesting stuff coming up!<br><br>
|
More bad news for Mastro
Posted By: <b>ScottDango</b><p>does he remind anyone of a young george steinbrenner ? maybe it just me? maybe its the white turtleneck....
|
More bad news for Mastro
Posted By: <b>Phil Garry</b><p>I just received my Mastro Classic Collector Auction catalogue in the mail today. Seems like a very weak offering compared to their past auctions, even the Classic Collector ones......
|
More bad news for Mastro
Posted By: <b>Robert Klevens</b><p>Dear Robert, <br>Mastro Auctions has processed consignor checks for your proceeds in the December 2008 Auction. Checks have been be mailed out and should arrive next week.<br><br>Thank you so much for your patience. <br><br>Walter Tomala <br>Comptroller <br>Mastro Auctions, Inc <br>(630) 472-1200<br>
|
More bad news for Mastro
Posted By: <b>Jeff Lichtman</b><p>Considering the fact that when you win a lot you can't get your cards until the check clears, why does it take months to 'process' consignors checks? It doesn't! It actually takes the same amount of time to 'process' the auction winners' checks as well. Mastro (and other auction houses that do this) are just taking interest free loans from their consignors. This is especially ironic considering how auctin houses profess to take care of consignors so well. Robert, if I were you I'd run that check to the bank. And I mean RUN!
|
More bad news for Mastro
Posted By: <b>boxingcardman</b><p>I mentioned that Mastro was using consignors as short term financiers last year when a discussion of this situation arose, and raised some doubters' hackles. Seems I was more correct than I'd like to have been. <br><br>Sic Gorgiamus Allos Subjectatos Nunc
|
More bad news for Mastro
Posted By: <b>marshall barkman</b><p>Jeff....you are 100% correct about your statement in regards to auction houses holding the cash. Milehigh set a record of over 2 million dollars so if they do not pay cosignors for 30 to 60 days then the money can be earning interest with the cash. I had to basically get on the phone and raise holy hell to get paid after waiting for two months with no payment. These auction houses always have excuses and anyone who has intelligence knows it is BS. The two antique auction houses i deal with are major ones but i have a special contract that has a clause about payment, when the auction house is paid then i get paid. Most folks want their items right away and pay for the things as soon as the auction closes.
|
More bad news for Mastro
Posted By: <b>Bruce Dorskind</b><p><br><br>Rob Lifson is faster than the local Chinese restaurant.<br><br>The last time we consigned a duplicate G&B gum card and Kalamazoo Bat card<br>to his auction we were paid within a week after the auction closed<br><br>While other firms have built massive infrastructures and focused on recycled <br>material, Rob brings fresh material to the market. His item descriptions are<br>museum class.<br><br>Unlike some old time auctioneers who close auctions at their whim or who are<br>so insecure that they don't deal with you because they think you are "out to get<br>them," Rob is the consummate professional. <br><br>Transparency, cash, and professionalism matters. Now, more than ever.<br><br>If you are selling anything that has a value in excess of $5000, especially memorabilia,<br>we think there are are only a few options. Robert Edward Auctions is far and away the<br>preferred choice<br><br><br>Bruce Dorskind<br>America's Toughest Want List
|
More bad news for Mastro
Posted By: <b>barrysloate</b><p>That was a strange post. Sounds a little like you work for the company.
|
More bad news for Mastro
Posted By: <b>James Feagin</b><p>Before I worked with Huggins & Scott as a writer, I consigned several items to them. I've always loved our policy of paying consignors. The day (heck, the minute) we get paid, the consignment check is made out and dispatched. It is a great policy that helped my decision to work with them. <br><br>James
|
More bad news for Mastro
Posted By: <b>marshall barkman</b><p>I must say Bill Huggins is hilarious and a good guy. I have never consigned with him but he sounded very cool when i spoke to him on the phone.
|
More bad news for Mastro
Posted By: <b>David Smith</b><p>I don't have ANY standing in this argument/discussion but I find it REALLY funny how it seems to takes SOOOOO long to get consignment checks out when, I am sure, SOME buyers pay for their auction wins by PayPal or wire/electronic transfer of funds.<br><br>So, auction company A gets a cleared wire transfer of funds two days AFTER the auction ends and then PAYS that money out a month or two later.<br><br>Am I correct about this?<br><br>David
|
More bad news for Mastro
Posted By: <b>marshall barkman</b><p>You are correct.
|
More bad news for Mastro
Posted By: <b>Eric B</b><p>I don't understand the point of holding consignor's checks in order to earn interest. It's just not that much. Using the $2 million previously mentioned, with interest at 3% (if you can get that) it comes to just $60,000 per year. So holding checks for 3 months (1/4 year) is just $15,000 income.<br><br>Ticking consignor's off for $15,000 ????
|
More bad news for Mastro
Posted By: <b>Bobby Binder</b><p>I think everyone is assuming that the winning bidders are paying lightning fast and it just not be the case now a days. As well you have no idea when they do get paid and it you have multiple items in the auction and they are won by different bidders you have to wait for all of them to pay. As well you need to consider that Mastro has been giving money up front for a lot of the consignments interest free so that is another factor in the equation.
|
More bad news for Mastro
Posted By: <b>John</b><p>Rob is a class act and when it comes to jaw dropers REA is the place to be...and in terms of customer service REA is tops!<br><br>However I would also rate Sloate Auctions up there with REA in terms of customer service and speed Barry runs a nice auction where theres always some great stuff.<br>
|
More bad news for Mastro
Posted By: <b>barrysloate</b><p>Bobby made a good point that I was going to bring up. Say someone consigns twenty lots to me. It's likely that fifteen of them will be paid in the first week after the auction. But I have never done a single one where I am not chasing after late payers. As sure as the sun rises, two weeks after the sale there will still be eight or ten bidders who haven't even written their checks yet. So that will slow down the whole process.<br><br>If someone consigns a single lot, and it is paid for quickly, I will pay the consignor in a more timely matter. However, it does sound like the troubles at Mastro go a little deeper than just waiting for bidder checks.
|
More bad news for Mastro
Posted By: <b>boxingcardman</b><p>You are thinking too linearly on this issue. Holding consignor money 45 days isn't about banking the cash and earning interest, it is about using the funds as a short term source of funding so as to minimize the amount of use made of a credit line, which has a far higher cost than what the money could earn. Many of us do the same thing to Visa, MC and AMEX when we pay down the card every month. Now factor in Mastro's schedule of auctions--3 CC and 3 regular, spaced roughly evenly throughout the year and you have a large anticipated cash flow every two months (plus an extra here and there like the live auction at the National). Instead of living on the net left after an auction supplemented by credit they have to pay for until the next stream of revenue and escrowing the auction proceeds, my bet is that they used the consignor money as it came in for operating expenses, advances, etc., minimizing the cost of credit by taking a free short term loan from the consignors. It probably saved them several months a year in interest on several million dollars in short term loans. My hunch is that the hiccup this month was that a bank pulled a credit line unexpectedly, leaving them with no cash (they'd spent that first) and nowhere to get it to write the checks at the 45 day mark, until they freed up funds from elsewhere or arranged a new line of credit. I would not be surprised if the story about the wrong account was literally true--it was probably a sweep type account into which the credit line was dumped as needed to cover checks. No line = rubber checks. <br><br>It's a nifty little scheme provided that the line of credit is there to cover the gaps. <br><br>Sic Gorgiamus Allos Subjectatos Nunc
|
More bad news for Mastro
Posted By: <b>Eric B</b><p>Great response. You are likely correct. I was under the assumption that they wouldn't need a line of credit. that would mean they are a "house of cards", pardon the pun.
|
More bad news for Mastro
Posted By: <b>Ted Sherman</b><p>One of my friends has a red sox store and the bank recently told him that his "inventory" could be used as collateral or assets. I guess it is the same type of thing.
|
More bad news for Mastro
Posted By: <b>marty q</b><p> rea- is as good as they come !! period. i second bruce d's comment's also. i have been to rob's house on a number of occasion's, he and his staff are simply fantastic, i have asked him on more than one conversation to do more auctions, i think this is great, i hope it works out for him. i have seen rob and his staff in action during auction time, not 1 lot is taken for granted, attention to research and authenticity is 100%. <br><br> adam- that post was great!!! i agree 100%, your dead on i would bet. if that is true that mastro lost a line of credit i would think the legal pressure may be tightening. or it could be just a sign of the times, banks not willing to go the extra yard, but for a reputation like mastro's i doubt that is the reason. you wonder how much $$$$ this will cost mastro inc.?????
|
More bad news for Mastro
Posted By: <b>Bill Panagopulos</b><p>Not to condemn nor praise Mastro, but...<br><br>I've been running historic auctgraph auctions for about 17 years. We pay consignors 45 days after the close of the sale, with our option for an additional 15 days to collect outstanding balances before considering bids reneged. In other words, if a consignor sells $1000 worth of material, and $800 worth is paid for in 45 days, he gets $800 on the 45th day, and we endeavor to collect the additional $200 over the next 15 days. And we DO endeavor, short of sending an armed posse to kick the door in.<br><br>The story about "floating" the money is really hogwash. The interst is negligible (I leave funds in a 1.5% checking account). Figure this: Sale closes, at least three days to invoice by email, additional 4-15 days (overseas) by USPS, and then wait, wait, wait for payment. And in this market, payment is S L O W! Now, that's not OUR fault, and it doesn't happen a lot, but it is increasing because collectors (like us) love our material but money is tight. Default rates haven't increased, but getting money on time is like pulling teeth.<br><br>BUT!! For the same reasons I have trouble getting paid, I have to pay on time. My experience is that it is ABSOLUTELY CRUCIAL that we pay exactly on time. We installed new software ($30K) for our last sale, it went nuts, and consignor reports and checks went out five days late...and I was nearly crucified. I had to reach in my pocket, but we paid in full, everyone. But the surest way for an auctioneer to put himself out of business, in my opinion, is delay in payment to consignors. Advances and guarantees are the biggest problem. I wish Bill Mastro all the best - he has top-quality auctions, and is a sharp businessman.
|
More bad news for Mastro
Posted By: <b>marshall barkman</b><p>What is hogwash is the 45 day wait. When a consigonor buys the item he or she generally pays cash for the item because most folks do not even want a check. The consignor then has to find a auction house that is suitable for the highest return on the investment. Sometimes the auction will not be for 30 or 60 days due to advertising the sale. So basically what you are saying is a guy could buy a item put it in the auction which could be a month out and then have to wait 45 to 60 days for payment. My thoughts on that are good luck and you have no fear of ever getting any of my high end autographs. Auction houses should change their policies and payment should be made in 2 to 3 three weeks.
|
More bad news for Mastro
Posted By: <b>Jeff Lichtman</b><p>Theoretically, there is no reason that consignment checks cannot go out the same day as the check clears paying for the lot. Both actions are dependent upon one thing: the lot winner's check clearing.
|
More bad news for Mastro
Posted By: <b>Fred C</b><p>I've got to agree with Jeff on this. Once the lot is paid for (and payment is clear) then the auction house should pay the consignor. There will be consignors that have multiple lots sold. In those cases at least get a good portion of the payments out and then the auction house can make a second payment after the late payers finally come through. <br><br>It's like an act of good faith on the auction house to get the consignor some cash ASAP. Then there are those like me who don't mind waiting 30-45 days for payment. I figure the money's gonna get to me because I'd only consign with the auction houses that I trust. <br><br>Perhaps somone with auction house experience can comment on their experiences. Do most bidders pay within two weeks? What percentage is paid within two, three and four week periods? What percentage of auctions have deadbeat bidders?
|
More bad news for Mastro
Posted By: <b>Robert Klevens</b><p>I actually consigned my lot at the National for their December auction. That was my poor decision. After waiting 5 months for the auction and 2 months more for my check I lost $1500 on my item. I know the winner of my item, and he paid quickly and received it already. Hopefully my check will arrive this week.<br><br>I won an item in the December auction for $18,099. I sent a cashier's check the same day and received the item quickly.
|
More bad news for Mastro
Posted By: <b>Jeff Lichtman</b><p>Exactly. Send the lot and check on the day that the check for payment clears. Or maybe a couple days later? Why 45 days later? One reason: tax-free credit line.
|
More bad news for Mastro
Posted By: <b>barrysloate</b><p>Jeff- you still miss a point. That works if you consign one lot; what if you consign ten lots and each payment comes in a different day? How many consignment checks would you expect to receive? In that case you need to give the auction house the time to collect all the money before they pay you.
|
More bad news for Mastro
Posted By: <b>Jeff Lichtman</b><p>But let's say lot 1 is paid for with good funds on a Tuesday; why can't the consignment check go out on Weds? And then the following week, three more lots clear -- why can't those consignment checks go out when those lots clear?
|
More bad news for Mastro
Posted By: <b>barrysloate</b><p>If only one lot is involved and it is paid for quickly, I always try to get the check out ASAP. I do however feel it is a good policy to wait for the winning bidder to receive his lot before I disburse a check to the consignor, but it is not mandatory.<br><br>But as in my example, if you consign ten lots and I get ten different checks that clear on ten different days, would you really expect that many checks sent to you? Wouldn't you more likely say just pay me at the end when all the money is in?
|
More bad news for Mastro
Posted By: <b>Robert Klevens</b><p>I consigned only 1 lot that sold for $1200. The buyer paid right away. I was told that Mastro gets a whole bunch of money in and then starts sending the consignment checks after 45 days. <br>They don't send the consignment checks when the payment is received.<br><br>I had some items in Seth's 19th Century Only auction and got my check very fast.
|
More bad news for Mastro
Posted By: <b>Jeff Lichtman</b><p>Barry, I see your point and that makes sense. However, as someone who feeds his family based on the number of checks I receive I would prefer to get them as fast as possible even if one at a time. <img src="/images/happy.gif" height="14" width="14" alt="happy.gif"> In all seriousness, I'd probably opt for half and half. And if 70% of my lots were paid for in 2 weeks, why should I have to wait 45 more days to get paid anything?
|
More bad news for Mastro
Posted By: <b>Bill Panagopulos</b><p>No offense, but...are you kidding???<br><br>Imagine the logistical headaches...<br><br>My sales are about 1,800 lots and one hundred consignors. So, you suggest I print 1,800 checks, with 1,800 cover letters sent in 1,800 envelopes times 1,800 stamps?<br><br>Please get real. If you need the money that desperately, sell on eBay. I pay for advertising, salaries, rent, pre-press, photography, shipping coming and going, printing, postage, electricity, and charge no interest on advances. And I don't charge interest to late-payers. If my sale does $1M and I get paid ALL of it the day after the auction, and hold it all for 45 days at 1.5% annually, I make all of $50,000 a year in interest, or a grand total of $1,111 over 45 days. Wow...
|
| All times are GMT -6. The time now is 06:51 PM. |