Who gets the buyer's premium?
 

I am rookie to the auction sales; it is a new beast to me. I am new to it and want some clarification....Who gets the buyer's premium on the auction? For example, last year the REA buyer's premium was 17.5%, is that what the auction house takes away for selling a card?
I am new to the auction house game. I, like most of you, have worked very hard for my money and like to know who is getting what when I send out a cashier check.
What is the usual percent a auction house gets on a sale??
Guess I have alot of questions!
Thanks for answering them



Isaac :cool:

I believe the auction house gets it, but if you have a card they really want to list, the seller can sometimes negotiate to get a portion of that as well!

feel free to correct me if i am wrong.

The auction house gets it. The "usual" model (if there is such a thing) is that the auction house takes from both ends. The consignor also usually pays a consignment fee. (I think this is more what FUBAR was talking about - some auction houses will waive or reduce the consignment fees on desireable items to get them inserted in their auction.)

On the buyer's premium end, some auction houses will offer a lower-percentage BP to a buyer on a high-dollar item.

For baseball card auction houses I think the BP goes from about 12.5% up to about 19.5% (most are at the higher end of that range), but I don't bid with all of them, so others may know better than I do.

Cheers,
Blair

I agree with above. Buyer's premimum goes to Auction house. Consigner pays an amt also for Auction house to present card for auction.
Leon(with B&L) would be able to add to this.

A strong auction house would do well. Example if they make 1 million in sales, they could be getting up to 150,000 to 200,000 from buyers premium and another 100 to 150,000 from consignment fees. Of course minus expenses for advertising, mailing, catalog production, etc.

Frank

For the record
 

We at B & L charge no sellers premium and only a 12 1/2% buyers premium. We do this to put as much money in the sellers pocket as possible. Obiviously by charging no sellers fee it puts more more in the consignors pocket, but also by keeping the buyers premium low, it allows the bidders to go one or two more increments and still be within their budget.

So in other words the seller is receiving 87 1/2% of the total sales price, much better than you will do on ebay after paying final value fees and paypal fees to them. AND, we have done all the work!

Scott and Leon

The Catalogue Auctions have to charge higher fees (on both ends), largely due to the costs of producing the Catalogues. The related costs are quite expensive and time consuming for their employees. Production, printing, photography, layout, man-hours, and postage costs for mailing the Catalogues out to thousands of prospective clients, etc.

That's where a significant portion of the money goes...

not quite
 

yes and no....catalogs cost about $10,000 for 1000 or so....as a balllpark rule...add another 5k for shipping and you have 15k......make it 25k to be as safe as possible. So on a million dollar sale, with no sellers fee and a 19% buyer fee, there is $190,000 gross profit. The math is pretty easy. Don't get me wrong.....auctions aren't as easy as some would think and there are tons of issues and work to be done. Catalogs are mainly so the consignors can see their stuff in print. And of course it's true I love my catalogs too, as a buyer....but they aren't that necessary, really. Just my opinion and others will disagree and have their right to disagree. It's ok....

btw, as the price of the catalog goes up, with the amount of items and pages, so do the revenues....

Scott and Leon are the best. Leon will even come to your house and wash and wax your car for a nice consignment.

absolutely
 

Hey Jay,
I will absolutely wash and wax cars for consignments. I have done more for less, and under worse conditions, so that would be a piece of cake.

I am already looking forward to getting together with you, Richard and Scott again at the next National. Those are 4-5 of my favorite days of the year.

Me too, buddy

The buyer pays 12.5% more, but the seller gets $100 of every $112.5 (100/112.5). So the seller actually gets 88.889% of the final sale - even better than 87.5%.

I was trying to keep it simple.... :)

I knew someone would perform the exact calculation though.

Scott

Thanks Scott and Leon

to answer the original poster's question -- the buyer's premium is a surcharge that the auction house imposes on the buyer, on top of the closing price. So if the BP is 15%, and the closing price (ie the hammer) on the card that you won is $100, then the auction house will charge you $115. Be mindful of this when placing your bids -- some auction websites post the total price pretty clearly (and thus make it easy for you to know your true final cost) while others only post the bidding price (and thus leave it on you to figure out the BP, which makes the auction seem more attractive to you since the posted price seems lower).

you sure about that? does the seller's commission come off the hammer price, or the total price (ie including the BP) as you suggest. I had thought the hammer price...

Blair - I think that FUBAR meant exactly what he said, and I also believe this happens on occasion. In other words, If I have a $20K card to consign to an auction house, not only am I not expecting/willing to pay a seller's commission, but I am also looking for a slice of the 17.5% (or 19.5% or whatever it is) buyer's commission!!
Val

In this case, the point is moot. They were discussing B&L auctions, which has zero seller's commission.

Hi Val,

Thanks for your comment. I had not heard of a case of that happening, but I imagine on some high-end items the seller might try to cut a deal like that. I'd say if I had a T206 Wagner to consign, I'd try to haggle the auction houses into the best deal I could get (including a piece of the BP).

But at the level I play at, I wouldn't even try to swing such a deal :).

Cheers,
Blair

Yes, i meant exactly what i said..... as Val outlined better then i did!

Thanks alot to everyone for clearing it up for me.

Anyone know what sort of deals sellers of big dollar cards are able to get from the major auction houses? I'm just curious if you had a T206 Wag or other big dollar card, what sort of deal could you negotiate? None of this is public info, so I guess we'd be talking about rumors, but it would be interesting if anyone knew...

It seems like the website traffic from a really famous card alone would be worth it to some auction houses.