Shrinking Buyers Premium ?

[Aquarian Sports Cards]

Originally Posted by Johnny630

People who worry about buyers premium are worried about nonsense. Why so much envy towards businesses? Ie the auction house? Focus on you. Man so much complaining. If 20% BP bothers you that much don’t bid, end of story.

But seriously a couple good reasons were given. On those top items most auctions are already giving up some of that BP and of course no commission. So there's only so many ways you can make less money before you're not making any money.

Also as you surmised Steve, you'd have to predict how much to the bottom line giving the percentage back would make and at what price levels to drop it. You're still gambling vs taking a sure thing. The gamble could pay off if you drop a point or two off the BP and the item sells for enough more to make up the discount, but that seems like an awfully iffy proposition. Let's say you have a 20% BP and at $100,000 you drop it to 18% that means the minute you hit $100k you LOSE $2k that you had in your pocket on the chance that the item sells for over $112k. yet the buyer only gets a $2k discount so why would he bid $12k more?

It's similar to the logic about why I try and explain to consignors that they should be HAPPY to pay for the grading. If you leave it to the auction to pay for the grading they're making the decision based on the perceived value increase versus their small percentage of the sale. if you have a card that's $800 raw and $1500 graded and it's going to cost $75. Let's say the auction is taking in a total of 20% on the card. So if they're paying for the grading they have to spend $75 to make an extra $140, and that's if they get the expected grade. It's just not worth it. If you agree to pay for the grading you're shelling out $75 to make an extra $540. By having the auction company pay for the grading you are likely costing yourself money becuase they are doing it with THEIR best interests in mind now and not yours!