Auction Buyers premiums

robr1967

Wow.

I just got an email from Mastro before their latest installment of their auction.

I am assuming they emailed everyone that ever bid and informed up that their buyer premimum is now being raised from a paltry 17.5% to 20%.

UNREAL ! ! !

I can imagine that the bidding will probably drop now a little bit for everyone now having to factor 20% into their total bids.

Does anything think this will affect the consignments anymore? People will have to assume that since they will be bidding less they might not get the prices on the lots anymore.

What are everyone elses thoughts here?

Griffins

there are threads about this on every board in the hobby this morning. It's going to effect the bidding on at least this auction, and really screws consignors that didn't know they were the guinea pigs for this new level of greed.
REA stands out as the best more and more as time goes on.

RayBShotz

Grif - Do you know when is the next REA Auction?
RayB

robr1967

REA??

Greed? That is an understatement. If I am not mistaken they were the 1st to push the limit taking it up to 17.5% and now they really out do themselves literally by taking it up to 20%.

I guess someone there needs a new Mercedes this year, huh?

I honestly am not sure about this, I want to say that up front, but do they big boys....I.e....Christies or Sithebys even charge 20%?

Griffins

Ray- I think it's the same time as last year, April I believe. The last one was so huge I was hoping he'd start running 2 a year, but it doesn't sound like it's going to happen.

1954

I got the email and was completely sick about it. Majority of the consignors are going to suffer this time around because the common buyer will most likely sit out or not bid aggressively. I have spoken to four guys this morning and all have basically said they were not going to participate in heavy bidding this time around. One of those guys is a pretty big player in their auction too. My ticket with Mastro over the past 12 months has been $92,000. Some of those items were not mine, but it definately changes my bidding philosophy. In past auctions I would bid on things that sparked my interests just to follow the item on the last night. Some of those items I have ended up winning because I wanted to win something and the other items were past my final offer. These are some of the items that will go cheaper when you don't have others as the underbidder.
Doug Allen- Here is a note to you.
I complained about this to you last time you did this. If Mastro HAS to bump up the buyers premium to make ends meet then why don't you tier the commission structure for the buyer just like you do the consignor? If the buyer purchases more than $20,000 the commission is 15%. If the purchaser exceeds $50,000 he pays 10%. I believe this would create an INCENTIVE for the buyer to go to the next level in order to get the reduction of commission fees in addition to adding more competitive bidding for the consignor.


Shane Leonard

diamondman

my question is what do they charge the sellers??? 12-25%???
Seems like only one making real profit is Mastro"s!
Master Stroke

Griffins

sellers fees range from 0% (or less, getting back some of the buyers premium) to 15%. Most of the people I know that have consigned pay 0-5%, with an occasional 10% for a low dollar item.

koby

G-R-E-E-D

ezyshooter

I think it's greed as well but 20 percent is alot easier to work out in your head then 17.5 percent.
Also if you check out some of the sets and singles there is a ton of MOSH stuff in this auction. I was right when i seen that MOSH had changed some of the sets over to MASTRO that they would be in the next auctions !!
Some really nice sets that are going to go very high !! People are going to pay top dollar just to be either #1 or close to #1 in the registry.
I am really going to be looking to see what alot of the basketball is going to go for. I will be bidding on it but doubt i will win any of it.
All of MOSH's stuff probably is being put up for zero percent for the consignor. They know there stuff is going to attract alot of buyers.
Steve

ctsoxfan

Lots of negative publicity for Mastro today. I wonder if they expected it to this extent?

benderbroeth

so let me get this strait if i win the wagner for $200,000 i will have to pay an additional $20,000 to the auction house correct?

i am new to the auction house buying but have an invester interested in the wagner so i need to know this and i am correct it applies to this auction?

djspann

20% of $200,000 is $40,000....so a $200,000 bid is $240,000.

benderbroeth

thanks sorry my math is bad tonight..lol but don't worry on bidding night i will use a calculator, and i was wondering if the consigner knew about this when they listed the items or if this happend after the items were listed because if they were i would reconsider pulling a card i originally put up for auction.

CDC4

not the best business move.

cardbender

I agree with Shane's post. They (Mastro) always have some truly outstanding items in all their offerings, but a tiered juice system would seem to bring on larger bids on the higher ticket items as they would approach certain bidding levels.

The consignors may lose on this change.

Griffins

the consignors did not know, and the contract stated that the buyers premium would be "at least 15%". As such they can't pull their lots. I know a few consignors that are really po'd and have vowed to never consign with Mastro again. I'm sure this has been planned for a while, and the announcement was timed with the auction going online today.

benderbroeth

wow that is a bad move. i mean i think it is a sneaky way of doing business and will make them lose future business i for one when i finish my T205 will never sell it through them.

koby

That was a very deceptive move by Mastro. Many large collectors are now saying that they will never sell through Mastro again.

1954

I have heard rumors that some of the auction houses including Mastro want to eventually go to 25% buyers premium. I guess their plan is to hike up the commission 2.5% until they reach this number. After recieving the email from Robert Edwards with regards to "other" auction houses selling fake autographs and altered cards. This makes me feel more comfortable towards REA. I appreciate what REA is trying to do in this hobby of ours and perhaps Mastro is making this an easier transition to go with REA by increasing their commission structure. For those of you who did not receive this email from REA, it was very informative and I feel a strong stance towards some of the games being played in the industry. I deleted the email but I am sure someone received it and can copy it here for the rest of the board.

Shane

flatfoot816

I'll stop collecting before I pay an auction house 25%

DRS

The December Premium Auction preview is now on-line. Over 2,500 quality Sports & Americana lots are being offered in this very significant, upcoming sale, and it should prove to be one of the biggest events the hobby has ever seen! Catalogs will be shipped this week, and bidding begins Monday, November 20th.


Please Note - Effective immediately, Mastro Auctions will raise its Buyer’s Premium from 17.5% to 20%.


This will ensure that we do not have to compromise in any way, with respect to conducting our auctions in the industry's most thorough, professional and efficient manner. As a Company, we have always adhered to the principle that our customers demand the very best, and that they rely upon us to deliver at that highest level. We constantly apply this top-tier approach to every aspect of our business, from our custom on-line bidding system to our quality event catalogs, and in the most painstaking authentication and cataloging process in the business. This all costs money -- and the expenses associated with "going the extra mile" are always rising -- but it also produces extraordinary results. We didn’t want to bury this type of information in the small print of the catalog. Instead, it's best to communicate the new terms to everyone before the bidding starts ... on what we expect to be one of our largest offerings ever!

koby

Deceptive business practices usually catch up to people, no matter how clever they initially think they are.

It seems this greedy attempt to stick it to the buyers and sellers might be backfiring on Mastro already.

1954

I agree that they bring the very best to this market and because of this the customer deserves the very best service and products. There is no question that Mastro does a fine job of this. However does the cost of service not cost the same as it did last year? Maybe they added an extra couple of employees this year over last? I don't think a 2.5% raise would justify those additions. Mastro has three big auctions that usually closes around $12M each then 3 internet auctions that closes around $2M each. This is $44M in annual sales. The 2.5% commission adds $1.1 million dollars to the companies surplus. Must be nice being Mastro.

TheCARDKid

They're making buckets of dough over there...

$44 m a year in sales. Say on average, 5% selling commission and (up until now), 17.5% buyer's premium. With a 22.5% take, that's $9.9 m in gp. Their fixed costs (salaries, rent, advertising) can't be more than a few million dollars in total. They're easily making $4-5 million a year. Very nice.

PhilliePhanatic

I doubt that the 2.5% increase is going straight into Mastros pocket. There is so much competition in the auction business that their seller's premium has got to be way down. This increase is just a way for them to recapture some of this.

If anyone is paying their listed seller's commission then they are crazy. You need to be able to negotiate.

Five years ago, their average seller's commission was probably 10% and their buyer's commission 15% for 25% total.

Today their average seller's commission is 5% (maybe less?) and their buyer's commission 20% for 25% total. I know many people who have paid very low seller's commissions on their consignments.

So their is really no difference in the net fees.

However, I do not like the way that they sprung it on us without any warning. It would have been nice to have been told about this a couple of months ago.

Heritage and Sportscards Plus and Sotheby's all have 20% buyer's commission. I have never heard anyone complain about them. Goodwin, Mile High, Leland's, Grey Flannel are all 17.5%. The rest of the auction houses are 15%.

I have been getting Mastro's catalog since the beginning and I think that their presentation is worth 2.5% more than the competition.

flatfoot816

I have been getting Mastro's catalog since the beginning and I think that their presentation is worth 2.5% more than the competition

good for you--you'll probably have much less competition in this auctoin for what you want to buy. Again, I am not surprised. All auction houses will continue to raise their rates until people get so p1ssed off that they stop buying.

But the way they did it stinks. I have spent over $20,000 with MAstro in the last 5 years(yeah, small potatoes for them, but a boatload for the average Joe)...and never even got the e-mail. Only way I found out was this board. Otherwise I would have had to find it in the catalogue. Not cool, gents