How much commission does Stacks take on consigned items?

chaze215

I tried to find it on their website, but all I could find was this (which tells me nothing):
Competitive Commission Rates—Often, coins sold through Stack’s bring more after our modest commission, than the same coins would have brought if sold free of charge by another auction house.
Anyone have 1st hand knowledge of what they charge? Thanks in advance!

RYK

I believe it is negotiable. I have heard everything from 30% to 7%, but it is usually in the 10-18% range, based in what you are selling, its value, and other terms and conditions. 15% is probably a good starting point.

coinguy1

As RYK said, commissions are negotiable. Some consignors pay as much as a 10-15% seller's commission, on top of the 15% buyer's premium. And others, get more than 100% of hammer.

It depends upon factors such as:

The total value of the consignment

The number and value of individual lots

The desirability of the coins

Whether the seller places a reserve on the coins (and if so, what % in terms of dollar amount meets reserve)

Whether the seller has the requisite knowledge required to negotiate effectively


Keep in mind, that the auction house charges a 15% buyer's premium. So, if you, as the consignor, are charged zero % seller's commission, they still make 15%. And that 15% actually comes out of the consignor's pocket, in the form of reduced hammer prices, upon which the consignor is paid.

RYK

To that point, Mark, with the oft confusing buyers' and sellers' commissions, which we all know both get paid by the seller, has there been any recent interest or movement to get rid of that arcane system and just have the buyer pay hammer and the seller get a previously negotiated percentage? It just makes a lot more sense to me.

roadrunner

Keep in mind, that the auction house charges a 15% buyer's premium. So, if you, as the consignor, are charged zero % seller's commission, they still make 15%. And that 15% actually comes out of the consignor's pocket, in the form of reduced hammer prices, upon which the consignor is paid.

Coinguy1, you wouldn't believe it but I spent a lot of time one weekend trying to convince professional classic car dealers/restorers/car collectors that in fact the buyer's fee came out of their pocket when they were buying at auto auctions. I finally gave up. It seems that a majority of the auto industry believes the same thing, even the pros. Some think it is just one of those unfortunate things you have to "pay" to get entry to the auction. They don't even factor it into their bids....just keep the old hand up until you win. One dealer even showed me his invoice from an auction where the buyer's fee was added on to his bid. That was his "proof" that he paid the buyer's fee...not the seller. And I have to agree with him since he never considered backing out the BF out of his bid.... . And while that was "only" a 5% BF at a local Mass. auto auction, the dealer happily paid the fee on top of his high bid. He said he really didn't miss the 5% and it was part of doing business. I wonder if he would miss it if they tacked on 10%?

To make things worse. I went on line to see how prevalent this belief is. I just couldn't believe people were so gullible and easily mislead. But for every 20 or so Google references on buyer's fees, only 1 discussed the possibility that it came out of the seller's pockets. Considering that over 90% of the references on line originate from auction houses I guess it shouldn't be a surprise. I even found one major line out of the UK where the author was incensed about buyer's being "ripped" off by a 15-20% buyer's fee. I took the time to write this buy but he never replied. But as long as bidders don't back out their bids, they do in essence pay the BF and give the seller an additional free pass. Of course, as always, the house always gets their share. The reference's on line dutifully report that the buyer's fee is added to the buyer's invoice or the hammer price....which is true. They never want to get into the nuts and bolts of what that really means. I even found some auction houses who felt it was "cheating" on the part of bidders if they backed the BF's out of their bids. In essence they were taking money out of the mouth of the poor dealership....lol.

GA news - UK ....article by Stuart McClaren. Bonehead or sage?

A buyer's premium is basically a charge levied by the auction house, which is paid by the buyer in addition to the hammer price. The buyer's premium is kept by the auction house and is not passed on to the vendor. This means that you are paying an additional fee to the auction house for the privilege of having bought from them: it's a bit like Tesco's charging you 30 pence for tin of baked beans, and then charging you an additional three pence fee for the pleasure of having shopped in their store. .....yes, you read that right. And this is from a company (Government Auction News) specializing in steering their clientele to bargain-priced merchandise at auctions.

RYK, considering the huge amount of confusion on this topic by the general populace, I don't think their's a chance in he!! that the auction houses would give up the buyer's fee. Note that some of the big art houses went to a 25% BF two years ago....on the premise that the "buyer's" should help some of the "seller's" pain....lol. There are some mom and pop shops that deal only with a Seller's fee or Buyer's fee, but they are in the minority. In the auto business many dealers feel that a BF has reduced their overall profits on vehicles coming to the auction block. That is, that buyer's are turned away by buyer's fee (ie they think they pay it). We'd have an easier time of balancing the national budget or trying to school the public on otc derivative's modeling than trying to convince them that they don't have to pay the BF's.

What it comes down to is people believe what they want to believe, and you can't tell them any different. I ultimately learned that buyer's fees are indeed paid by the buyer's in many instances. Collectors and dealers participating in the coin auction business is not the norm by any means.

roadrunner

coinguy1

<< <i>To that point, Mark, with the oft confusing buyers' and sellers' commissions, which we all know both get paid by the seller, has there been any recent interest or movement to get rid of that arcane system and just have the buyer pay hammer and the seller get a previously negotiated percentage? It just makes a lot more sense to me. >>

Robert, there hasn't been any such movement that I'm aware of. And, like Roadrunner, I don't expect any.

A lot of consignors fail to understand that in most cases, the so-called "buyer's premium" actually comes out of their pockets. So, auction houses can quote seemingly low seller's rates and make big commissions.

My first experience with "buyer's premiums" occurred when I was working for Steve Ivy Numismatic Auctions, before Steve Ivy and Jim Halperin (New England Rare Coin Galleries) merged. The two companies were highly innovative competitors, and (if I recall correctly) New England was the first to offer the "buyer's premium" and lower "seller's commissions".

I remember how difficult it was for us at Ivy to compete with that. We tried and tried to explain to potential consignors that the "buyer's premium" was coming out of their pockets in the form of reduced hammer prices, upon which they were being paid. And that New England wasn't really offering a better deal, like it seemed. But a large number of sellers couldn't grasp that concept, and we lost out on a lot of consignments. So, eventually, Ivy (and other companies) switched to the "buyer's premium" commission structure. Even today, many sellers have trouble understanding the implications of "buyer's premiums" and how it affects hammer prices and the seller's bottom line.

ColonelJessup

Didn't this idea originate in Britain or Europe?

coinguy1

<< <i>Didn't this idea originate in Britain or Europe? >>

Colonel, are you tired today? That was one of your shorter posts I think the answer to your question is yes.

Elcontador

From what I understand, the biggest fish of the consignors can get 107-108% of hammer. Everything else is negotiable. As others have written, any fees charged means the consignor gets less. If people don't get that, it's their problem when they consign.

coinvac41

I too have been to auctions where, like Roadrunner said, the bidders keep their hand in the air until they win. If I attend an auction with a "bidders penalty" which is rare, I tell the auctioneer ,and hopefully the seller if they are present , that I will scale my bid back the amount of the premium. On the same vein, e-bay sellers at times will say they will combine shipping up to, at times as much as $14.95 shipping, on items if one bidder wins all, could be shipped for $4.95 in a flat rate box. You are either the windshield or the bug!!!