Are auction house commissions outrageous--??
percyb
Posts: 3,333 ✭✭✭✭
I was looking at Coins for sale at David Lawrence's website. I was turned off by the 25% commission though. Seems like they could simply charge a handling fee...$x.oo
"Poets are the unacknowledged legislators of the world." PBShelley
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In honor of the memory of Cpl. Michael E. Thompson
on the slick paper in the now massive auction books. The cost of personal to write up
the auction lots as well as storage, book keeping, security, mailing of catalogs,
cost of auction halls, cost of lunches and dinners for bidders as well as the need
to be competitive in obtaining the exciting collections requires the houses to pay
the consignors of such premier collections 105 - 110% of the sale price leaving the
House with markedly reduced net profits for their efforts.
If the auction house does a good job on pictures and write up of ones consigned lots
and a good price is obtained, then the cost is well earned. On the other hand............?
Camelot
"Seu cabra da peste,
"Sou Mangueira......."
<< <i>
If the auction house does a good job on pictures and write up of ones consigned lots
and a good price is obtained, then the cost is well earned. On the other hand............? >>
Not sure what this has to do with the buyers' fees. I can buy 50K worth of stock and have it inventoried and kept at a brokerage firm for under $10. I think these fees at the auction houses placed on the buyer of coins are astronomically over priced.
<< <i>
<< <i>
If the auction house does a good job on pictures and write up of ones consigned lots
and a good price is obtained, then the cost is well earned. On the other hand............? >>
Not sure what this has to do with the buyers' fees. I can buy 50K worth of stock and have it inventoried and kept at a brokerage firm for under $10. I think these fees at the auction houses placed on the buyer of coins are astronomically over priced. >>
Generally speaking, the so-called "buyer's fees" actually come out of the seller's pockets in the form of reduced hammer prices upon which the sellers are paid. For example, If I, as a buyer, am willing to pay $1000 maximum for a coin and there is a 15% buyer's fee, I simply bid $870 hammer on the item.
Member ANA, SPMC, SCNA, FUN, CONECA
<< <i>It certainly makes the idea of profiting in this hobby a little tricky, not that anyone should collect with that in mind. >>
Not counting my activity as a dealer, as a collector this hobby is way more profitable than any other hobbies I've had such as triathlon, sport car racing, metalworking, to name a few. I have 2 $2500 90's vintage bikes hanging in the garage probably worth $50 each. I have a large assortment of race car parts that I should probably just throw out and I have perhaps $20,000 worth of metalworking tools that weighs perhaps close to 20,000 lbs that I need to sort and thin out to make more room in the garage....Racing cars seemed to go through money the fastest--$1-2000 worth of tires and brakes in a weekend not to mention gas and other parts of the car that were tweaked.
--Jerry
``https://ebay.us/m/KxolR5
Yea, but those kind of hobbys bring in the hot babes, did you count that?
``https://ebay.us/m/KxolR5
As Coinguy1 stated 10% "seller" commish + 15% buyer fee = 25% paid by seller...of course that assumes the seller does no negotiating. The buyer never pays any commissions or fees unless they forget to back them out and get carried away in their bidding. Even back in the 1980's most typical consignments cost the seller 18-22%. But it probably has gotten better since that time. I recall getting 18% commish back in the late 1980's from B&M for consignments around $20K or less. That was actually a slightly reduced rate from their standard one.
roadrunner
<< <i>
<< <i>
<< <i>
If the auction house does a good job on pictures and write up of ones consigned lots
and a good price is obtained, then the cost is well earned. On the other hand............? >>
Not sure what this has to do with the buyers' fees. I can buy 50K worth of stock and have it inventoried and kept at a brokerage firm for under $10. I think these fees at the auction houses placed on the buyer of coins are astronomically over priced. >>
Generally speaking, the so-called "buyer's fees" actually come out of the seller's pockets in the form of reduced hammer prices upon which the sellers are paid. For example, If I, as a buyer, am willing to pay $1000 maximum for a coin and there is a 15% buyer's fee, I simply bid $870 hammer on the item. >>
If there isn't a buyer's fee, as you say, then why do they call it a buyer's fee?
"Seu cabra da peste,
"Sou Mangueira......."
2 You do not have to buy your coins at auction
SOSTOPYOURBELLYACHINANANDBEQUIETBEFOREICOMEOVERANDBITEYOURNOSEOFF.
Camelot
It's called that simply to confuse sellers as to the specific pocket that commission is ultimately coming from. Hardly a month or two goes by around here when a potential bidder complains about the buyer's fees thereby proving my point. Only seller's should be complaining about buyer's fees since it comes out of their pockets. If the auction houses had started calling this seller's fee #2 would it have gone over as well?
roadrunner
<< <i>If there isn't a buyer's fee, as you say, then why do they call it a buyer's fee?
It's called that simply to confuse sellers as to the specific pocket that commission is ultimately coming from. Hardly a month or two goes by around here when a potential bidder complains about the buyer's fees thereby proving my point. Only seller's should be complaining about buyer's fees since it comes out of their pockets. If the auction houses had started calling this seller's fee #2 would it have gone over as well?
roadrunner >>
When I buy a house I pay a price for it. I don't add on, nor does the seller, a premium. The seller pays the commission to the buyer's agent for bringing the buyer and selling the product to the buyer. The seller's agent lists the property and advertises it. So the seller pays the commission, not the buyer.
If you think you can do it yourself for less, there is opportunity for you in the auction house arena.
When you start adding up the costs of running a comparable business, you may not think it is so high
plus all the contact with the buyers and sellers
and you could also stop buying from the houses you dislike outrageous fees at
<< <i>
<< <i>If there isn't a buyer's fee, as you say, then why do they call it a buyer's fee?
It's called that simply to confuse sellers as to the specific pocket that commission is ultimately coming from. Hardly a month or two goes by around here when a potential bidder complains about the buyer's fees thereby proving my point. Only seller's should be complaining about buyer's fees since it comes out of their pockets. If the auction houses had started calling this seller's fee #2 would it have gone over as well?
roadrunner >>
When I buy a house I pay a price for it. I don't add on, nor does the seller, a premium. The seller pays the commission to the buyer's agent for bringing the buyer and selling the product to the buyer. The seller's agent lists the property and advertises it. So the seller pays the commission, not the buyer. >>
And if, when buying a house, you had to pay a 15% "buyer's premium", you would probably offer less, to make up for that. Hence, the "buyer's commission would end up coming out of the seller's pocket in the form of a lower sale price. In most cases, any commission that is charged, is paid by the seller - it doesn't matter what it's called.
If you do not like the auction fees, buy your coins somewhere else
There are many ways to buys rare coins and auctions are only one way
However, there are some coins that you will only find at auction.
What I consider to be the best coins in my colection have come from auctions
If you wanna play, you gotta pay
Mercury
<< <i>I was looking at Coins for sale at David Lawrence's website. I was turned off by the 25% commission though. Seems like they could simply charge a handling fee...$x.oo >>
I hear you percyb. I (and others) tried to ask this same question here before and no one wants to hear it. Although I agree in theory that sellers pay the buyers fees, I still think a lot of bidders do not stop when they get to x percent of their price. You have to eventually keep up with these bidders if you want the coin. Someone has to pay the auction houses and I think it is both buyer and seller.
<< <i>It certainly makes the idea of profiting in this hobby a little tricky, not that anyone should collect with that in mind. >>
It's trickier than you think.
It's practically impossible to make a profit in the hobby.
The mere illusion of being able to make a profit attracts people to the hobby.
Which helps it make a profit.