Heritage Buyers Premium

[oldjudge]

It appears that Heritage has increased their buyers premium from 20-22%. Did I miss an announcement or did this just quietly happen?

[sb1]

It was on the top of their auction page listings a couple of weeks ago. Hard to believe no one commented until now...

[raulus]

Worth every penny, and a bargain at twice the price!

Hard to imagine many of the high rollers bidding there are scared off by the extra 2%.

Or will even be bothered to adjust their max bids downward by 2% to account for the extra juice.

[oldjudge]

At the end of the day it means nothing to buyers who can adjust their bids accordingly. Who might be impacted though are consignors who negotiated BP rebates before the bump. I wonder if they will see a 2 percentage point increase to their rebate to make up for this.

[samosa4u]

Originally Posted by sb1

It was on the top of their auction page listings a couple of weeks ago. Hard to believe no one commented until now...

People here normally don't criticise auction houses because they don't want to get the boot !!

[Lorewalker]

I did not notice but that is because I do not care. If a house wants to charge 72% I am fine with it. It all gets taken into account before I place my bids.

[oldjudge]

I think we all take the buyers premium into account when we bid but with a higher premium do we still end up pay more for cards--I think so. For example, let's say there is a card coming up that you want. Let's say you are willing to pay $1000 for it. The current bid is at $750 and the next bump is to $800, do you make the bump? At a 20% BP the total is $960, which is under $1000 so you bid. At a 22% buyers premium the total $976 so you also still bid, but now because of the change in BP you have paid (assuming you win the card) $16 more. Maybe at times the higher BP results in the bid exceeding the person's cutoff while the lower BP would have allowed for a bump. While theoretically possible I think most bidders have a little flex in their cap and therefore, I think in most cases the higher BP just results in more money spent on the same card. Because of this my preference is always to favor the auction house with the lower BP.

[calvindog]

Originally Posted by oldjudge

I think we all take the buyers premium into account when we bid but with a higher premium do we still end up pay more for cards--I think so. For example, let's say there is a card coming up that you want. Let's say you are willing to pay $1000 for it. The current bid is at $750 and the next bump is to $800, do you make the bump? At a 20% BP the total is $960, which is under $1000 so you bid. At a 22% buyers premium the total $976 so you also still bid, but now because of the change in BP you have paid (assuming you win the card) $16 more. Maybe at times the higher BP results in the bid exceeding the person's cutoff while the lower BP would have allowed for a bump. While theoretically possible I think most bidders have a little flex in their cap and therefore, I think in most cases the higher BP just results in more money spent on the same card. Because of this my preference is always to favor the auction house with the lower BP.

Of course this will increase the costs to bidders in the heat of the moment bidding, as we all know. But Goldin going to 22% ensured that other houses would follow. I think Heritage was the first to go to 20% and they haven't had an increase in about ten years is my guess. Of course, their gross sales have quintupled probably since then so I suspect they'd be fine without raising the BP 2 points.

[darwinbulldog]

Originally Posted by oldjudge

I think we all take the buyers premium into account when we bid but with a higher premium do we still end up pay more for cards--I think so. For example, let's say there is a card coming up that you want. Let's say you are willing to pay $1000 for it. The current bid is at $750 and the next bump is to $800, do you make the bump? At a 20% BP the total is $960, which is under $1000 so you bid. At a 22% buyers premium the total $976 so you also still bid, but now because of the change in BP you have paid (assuming you win the card) $16 more. Maybe at times the higher BP results in the bid exceeding the person's cutoff while the lower BP would have allowed for a bump. While theoretically possible I think most bidders have a little flex in their cap and therefore, I think in most cases the higher BP just results in more money spent on the same card. Because of this my preference is always to favor the auction house with the lower BP.

If the most I'm willing to pay for a card at Heritage is $1,000, the most I would bid is $1,000 -7% sales tax -$25 shipping -22% buyers' premium, so the most I would bid is $745. Previously (i.e., with a 20% buyers' premium) I would have been happy to place the $750 bid, but in this case I would not. But the key issue that isn't addressed in your post is that the high bids you're invited to top now will be systematically lower than they previously would have been because the other bidders are making the same calculations that I and the rest of us are, whereas it's just sort of implicit in your presentation that the identical $750 leading bid is sitting there waiting to be topped regardless of what the buyers' premium for the auction is.

[ullmandds]

Originally Posted by Lorewalker

I did not notice but that is because I do not care. If a house wants to charge 72% I am fine with it. It all gets taken into account before I place my bids.

While I feel similarly...you won't win many desirable cards with this montre!

[Ray Van]

Originally Posted by Lorewalker

I did not notice but that is because I do not care. If a house wants to charge 72% I am fine with it. It all gets taken into account before I place my bids.

If you did not notice it, you could not have taken it into account before placing your bids. Just sayin'

[Beercan collector]

show dealers with “ auction prices” Starting to look like bargains

[Balticfox]

Originally Posted by samosa4u

People here normally don't criticise auction houses because they don't want to get the boot !!

Don't count me among the wimps or faint of heart. Whoever gets my criticism whenever it's due!



Incidentally, has anyone on this board been blacklisted from an auction house for criticism? This is your opportunity to embarrass whichever!

I recall that Mastronet sent me one of their spam emails about how great/fantastic their next auction was going to be circa 2004. I responded with a sarcastic remark. Well William Mastro banned me from their bidding list in response. After a few years one of us was convicted of fraud and sent to jail.

[raulus]

Originally Posted by Balticfox

Incidentally, has anyone on this board been blacklisted from an auction house for criticism? This is your opportunity to embarrass whichever!

Pretty sure Snowman was recently banned after some posts around here about one of the major AHs, when the scan in the online listing didn't reflect the creases in the card he actually received.

As always seems to happen, things escalated quickly.

Somewhat differently, I had a rather public beef here with another major AH, when they sent me fakes. They didn’t ban me, but based on my experience with their leadership, I self selected out of bidding on their stuff going forward.

[Touch'EmAll]

FWIW - I just printed out my eBay report for last year. Selling costs plus eBay fees plus shipping amounted to 25.03% of gross sales plus shipping - more than I thought.

[tjisonline]

Memory lane with a 1933 160 Goudey Gehrig PSA 1. Snowman was 100% correct in this case. The card ended up being relisted in their infamous May 4, 2024 auction w/ proper + transparent pictures & description that time. Naturally, it’s sold for less the second time around ($3,763 vs $2,546)

Jan 11 2024 auction
https://memorylaneinc.com/site/bids/...e?itemid=80061

May 4, 2024 auction
https://memorylaneinc.com/site/bids/...e?itemid=82822

Originally Posted by raulus

Pretty sure Snowman was recently banned after some posts around here about one of the major AHs, when the scan in the online listing didn't reflect the creases in the card he actually received.

As always seems to happen, things escalated quickly.

Somewhat differently, I had a rather public beef here with another major AH, when they sent me fakes. They didn’t ban me, but based on my experience with their leadership, I self selected out of bidding on their stuff going forward.

[conor912]

Originally Posted by samosa4u

People here normally don't criticise auction houses because they don't want to get the boot !! m[/IMG]

Haven’t you heard? Getting banned for expressing a dissenting opinion is the new American way.

[Touch'EmAll]

Agree with the thought that this will tend to hurt consignors more than buyers - although everyone calls it a "buyers premium".

If most buyers have a max bid price in mind, they will simply lower their bid to account for the increase in BP. Ultimate loser is seller whose hammer price has now been lowered.

[GeoPoto]

Let's say you had an item you expected to sell for $1M. AH1 has 20% BP and offers 15 points back. AH2 has 22% BP and offers 17 points back. Which one are you going to choose? Wouldn't you rather have the upside if bidders end up exceeding their limits?

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[Gorditadogg]

Originally Posted by GeoPoto

Let's say you had an item you expected to sell for $1M. AH1 has 20% BP and offers 15 points back. AH2 has 22% BP and offers 17 points back. Which one are you going to choose? Wouldn't you rather have the upside if bidders end up exceeding their limits?

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This is purely a thought exercise for me, but if you're saying the net fees to me are roughly the same (my math says $41k to $41.5k) then what I would be most concerned about is making sure the bidding gets to $1M. Does having a 22% BP get me higher bids?

I don't know anybody who has $1M to spend on cards that would say "What the hell, it's just another $20k in fees". (Except Ryan, apparently.)

I guess I would be more worried about the opposite. Does the fact that the BP is higher give the perception that the card is worth less? Is it less likely for a bidder to bid $1M seeing that the BP would be $180k?

My point is, I think I would focus on how to make sure I get my $1M, not the (slight) potential of an extra $20k.

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[Snapolit1]

I don't care what anyone says about Facebook groups. . . . there are a lot of scumbag losers on Facebook and a lot of "older" people [like me] who want no part of it and never did. Even more importantly, I would imagine that the average person getting a box of beautiful catalogs from Heritage or Mile High has economic assets far surpassing the typical Facebook goober. Of course there are exceptions, but when you buy with an AH you are not relying on the integrity of some random person.

Why do you go to a good auction house? To get your stuff in front of rich people who can spend big money. And you are relying on the skills of someone to market it in an attractive way to those folks. Period.

Same reason people list their real estate now with Sotherby's and happily pay their commission.

[gunboat82]

Originally Posted by Snapolit1

Same reason people list their real estate now with Sotherby's and happily pay their commission.

Eh, I actually grumbled quite a bit when Sotheby's took 22% of my home sale.

[Rhotchkiss]

Originally Posted by Gorditadogg

I don't know anybody who has $1M to spend on cards that would say "What the hell, it's just another $20k in fees". (Except Ryan, apparently.)

It’s not the actual $$s. It’s all relative. If you were going to spend $120 for a card ($100 hammer plus $20bp), wouldn’t you spend $122? Are you really going to let it get away over $2?

Let’s say you were going to spend $1200 on a card ($1000 hammer and $200 BP). Wouldn’t you spend $1220 to get the card, or will you let it get away over $20?

Now $12,000 ($10,000 hammer plus $2000 BP). Are you not going to pay $12,200 to get the card?

On $120,000…. It’s $122,000. I understand it’s another $2,000 but if you were going to pay $120k I don’t think you let the card get away over another $2000.

And so on. I suppose at some point the 2% becomes large enough that it gives you pause, but I think it’s relative.

And BTW - many auction houses started charging state taxes after the Wayfair ruling in 2018. In Maryland, that resulted in 6% more cost than before; I expect that’s about average. I don’t think the implementation of state taxes had a material change in bidding habits. In fact, card prices have soared since we started paying state taxes.

[Peter_Spaeth]

A rational person would still take state taxes into account when bidding. That the market has independently soared due to other forces since 2018 doesn't speak one way or the other to that, it's an illogical observation. If hypothetically the market overall had stayed flat, hammer prices would be down because of taxes being added to the bill, at least in a world where most people bid rationally.

[raulus]

Originally Posted by Peter_Spaeth

A rational person would still take state taxes into account when bidding. That the market has independently soared due to other forces since 2018 doesn't speak one way or the other to that, it's an illogical observation. If hypothetically the market overall had stayed flat, hammer prices would be down because of taxes being added to the bill, at least in a world where most people bid rationally.

Put me down for the hypothesis that baseball card buyers participating in auctions do not bid rationally.

[Gorditadogg]

Originally Posted by Rhotchkiss

It’s not the actual $$s. It’s all relative. If you were going to spend $120 for a card ($100 hammer plus $20bp), wouldn’t you spend $122? Are you really going to let it get away over $2?

Let’s say you were going to spend $1200 on a card ($1000 hammer and $200 BP). Wouldn’t you spend $1220 to get the card, or will you let it get away over $20?

Now $12,000 ($10,000 hammer plus $2000 BP). Are you not going to pay $12,200 to get the card?

On $120,000…. It’s $122,000. I understand it’s another $2,000 but if you were going to pay $120k I don’t think you let the card get away over another $2000.

And so on. I suppose at some point the 2% becomes large enough that it gives you pause, but I think it’s relative.

And BTW - many auction houses started charging state taxes after the Wayfair ruling in 2018. In Maryland, that resulted in 6% more cost than before; I expect that’s about average. I don’t think the implementation of state taxes had a material change in bidding habits. In fact, card prices have soared since we started paying state taxes.

Yeah, the problem for me is that if I'm at $1200, I probably set a limit for myself of $1000 and am $200 over already. At some point you have to stop, don't you? Even if it's just another 2%.

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[Jewish-collector]

Sometimes, Al, you just gotta say, WTF and bid more than everyone else. beer chug.gif