Posted By:
bruce Dorskind
In nearly niche market, one or two competitors invest significant sums
of money so they can build a brand. Generally that brand commands
a large share of the market. The organization that owns the brand
is able to command a premium price for all of its services.
Whilst it is nice to think of baseball cards (and memorabilia) as a hobby,
it is for the dealers and auctioneers and other suppliers a business; one
that is no different than selling stocks, cars or coins and stamps.
In the baseball memorabilia auction business, one could argue that
there are 10 important dealers (seven of whom generate in excess of $2
million a year in auction sales)- the others are niche dealers- who have
wonderful offerings but their sales are relatively small.
If one totals up the prices realized (with the buyer's premiums) for all of the
sports only auctions, the total auction sales is a bit under $80 million
The Mastro total from their six auctions represents 62% of the toal
value of the sports auction market. Of course, that total does not include
a cadre of smaller auctioneers, none-specialist companies who auction
baseball items, and the king of all auctionners, EBAY.
Building and maintaining a brand which "owns" a market is expensive.
Furthermore, Mastro has private equity investors who expect a substantial
return on their initial investment.
Therefore, while it might feel good to complain about the high
auction premiums, the charges for the catalog, or the sevice fees
for shipping and handling, it is all a moot point.
It is unlikely than anyone else in the hobby has the resouces to
take any real market share from Mastro. They are more likely
to continue to raise fees than to lower them. They have the collectors,
they have the brand, and they are determined to make as large a
profit as possible...which, as far as we can tell, is what Christie's (private)
Sotheby's, E Bay and nearly every for profit organization attempts to do.
The only way Mastro will ever lower its fees is if they face competition
from the market which forces them to do so.
Of course, one can avoid the whole issue by providing Mastro with your
company or personal Federal Express account number.,..which is why
we have never paid a dime in shipping fees to Mastro.
Best,
Bruce
America's Toughest Want List