REA increasing their BP and making other changes

[Huysmans]

Originally Posted by jayshum

The assumption in the example you are questioning is that the bidder is taking the BP into consideration when placing a bid so that the selling price with the BP equals the selling price on eBay. Of course, not all bidders do this, but many on this board claim they do (or at least try to).

Fair enough. But what I questioned was the argument that the seller would get less with an auction house than Ebay as the original poster stated - which is wrong. 0% commission means the consignor gets 100% of the winning bid total. He tried to state that with a $5,000.00 winning bid, the consignor would only get $4,000.00 despite a 0% commission.

[jayshum]

Originally Posted by Huysmans

Fair enough. But what I questioned was the argument that the seller would get less with an auction house than Ebay as the original poster stated - which is wrong. 0% commission means the consignor gets 100% of the winning bid total. He tried to state that with a $5,000.00 winning bid, the consignor would only get $4,000.00 despite a 0% commission.

The 0% commission referred to is saying that the seller is not paying any commission to the auction house so they keep whatever the high bid is. However, the argument that was made is that when an auction house has a 23% BP, if the high bid is $4000 then the final selling price is really $4920, but the seller only gets $4000 and the auction house keeps $920.

On eBay, if a consignment company charges 5% of the high bid, if the high bid is $4920 (same as the selling price with the auction house including the BP), then the seller gets $4674 (95% of $4920) and the consignment company gets $246 (5% of $4920).

In the 2 cases above, the card is selling for $4920. One is a high bid plus BP (auction house) while the other is just a high bid (consignment house on eBay). When comparing the above outcomes, the seller is getting $4674 from the consignment company selling the card on eBay versus $4000 from the auction house.

[rand1com]

Ebay is unlikely to bring as much as top AHs on most items. There is no OT bidding on Ebay so an under bidder who is willing to pay more has no opportunity unless they put in a ceiling bid in advance of the close. The option of jumping back in after the initial bidding is closed often is the big difference in AHs. I see plenty of completed auctions on EBay that fall well under market even with the big guys previously mentioned. It is more of a crap shoot IMO.

[Huysmans]

Originally Posted by jayshum

The 0% commission referred to is saying that the seller is not paying any commission to the auction house so they keep whatever the high bid is. However, the argument that was made is that when an auction house has a 23% BP, if the high bid is $4000 then the final selling price is really $4920, but the seller only gets $4000 and the auction house keeps $920.

On eBay, if a consignment company charges 5% of the high bid, if the high bid is $4920 (same as the selling price with the auction house including the BP), then the seller gets $4674 (95% of $4920) and the consignment company gets $246 (5% of $4920).

In the 2 cases above, the card is selling for $4920. One is a high bid plus BP (auction house) while the other is just a high bid (consignment house on eBay). When comparing the above outcomes, the seller is getting $4674 from the consignment company selling the card on eBay versus $4000 from the auction house.

These are not equal comparisons. Both you and Ben are comparing a closing bid of $4,000.00 with the auction house, to a closing bid of $4,920 on Ebay. Honestly, can you not see the difference??

IF the closing bid for both the auction house and eBay is $4,920.00, which is all that matters in making a fair comparison, the seller with the auction house and a 0% commission fee gets $4,920. The eBay seller pays 5% commission which is $246.00, for a net total of $4,674.00 to the seller.

You're comparing two DIFFERENT high bid totals. You don't add the buyer's premium INTO the high bid, it's added ON TOP of the high bid. Of course the buyer will get more for a card that sells for a HIGH BID of $4,920 on eBay, compared to a card that sells for a HIGH BID of $4,000.00 at an auction house. I don't know how to better spell it out.

[jayshum]

Originally Posted by Huysmans

These are not equal comparisons. Both you and Ben are comparing a closing bid of $4,000.00 with the auction house, to a closing bid of $4,920 on Ebay. Honestly, can you not see the difference??

IF the closing bid for both the auction house and eBay is $4,920.00, which is all that matters in making a fair comparison, the seller with the auction house and a 0% commission fee gets $4,920. The eBay seller pays 5% commission which is $246.00, for a net total of $4,674.00 to the seller.

You're comparing two DIFFERENT high bid totals. You don't add the buyer's premium INTO the high bid, it's added ON TOP of the high bid. Of course the buyer will get more for a card that sells for a HIGH BID of $4,920 on eBay, compared to a card that sells for a HIGH BID of $4,000.00 at an auction house. I don't know how to better spell it out.

The assumption being made is that the selling price is the same because the buyer is including the BP being added on when determining what their high bid will be. If that's the case, then the example is correct. Yes, the high bids are different, but what the buyer pays isn't.

If the selling prices are different (which is what happens if the actual high bids are the same), then yes, the consigner will do better with the auction house, but since many people say they include the BP when deciding what their high bid will be, it's more likely that the high bid will be lower if there's a BP added on top of it.

[Huysmans]

Originally Posted by jayshum

The assumption being made is that the selling price is the same because the buyer is including the BP being added on when determining what their high bid will be. If that's the case, then the example is correct. Yes, the high bids are different, but what the buyer pays isn't.

If the selling prices are different (which is what happens if the actual high bids are the same), then yes, the consigner will do better with the auction house, but since many people say they include the BP when deciding what their high bid will be, it's more likely that the high bid will be lower if there's a BP added on top of it.

Thanks for the clarification on your part. I don't disagree with this at all. The original argument made was why would a consignor sell with an auction house as opposed to eBay, with the fees mentioned included 0% for the auction house, and 5% with eBay, yet he claimed the consignor would net more with eBay - which is wrong. That was my whole point. It is irrelevant what the seller pays in the end. IF the high bids are the same in both scenarios, the consignor would net more with the auction house. That's all I was stating.