Heritage Buyer's Premium going to 20%

REALGATOR

I hope they use the extra loot to do a better job describing their lots.

Here's the email I just received:

Please note that for all Coin & Currency auctions closing after August 11th, 2017, the Buyer's Premium will be 20% (minimum $19). Please direct any inquiries to 214-409-1150 or Bid@HA.com.

This was not a decision that we came to lightly. Heritage is a major player on the world auction stage, and our BP rates will now be competitive with the rest of the world's key auctioneers.

The Buyer's Premium for auctions in other categories will remain unchanged.

Sincerely,

Heritage Client Services
3500 Maple Ave. 17th Floor
Dallas, TX 75219-3941
Bid@HA.com
1-800-872-6467

Coinstartled

Truly a good thing as I am a buyer only. Easier than calculating the 17.5%.

Coinstartled

Extra loot is a fallacy unless the already excessive shipping fees increase.

jt88

@REALGATOR said:
I hope they use the extra loot to do a better job describing their lots.

I hope the same and provide better services but I have find they are not describe some of the item correctly

Cougar1978

What is the sellers fee? Seems like this would discourage submissions or do they even care (as stuff mainly their material they blowing out?). As a bidder I reduce my bids by any buyers fee accordingly.

No Headlights

They really need some true competition. Hope GC keeps growing, but they have light years to go to catch up with the greedy monster called Heritage. JMHO

Lakesammman

As a buyer, no problem - just feel bad for the consignors. (Yes, I know there is a potential split of the 20%.......)

Boosibri

Lets guess at the narratives to emerge from this thread:

1) Buyers fees are a massive reason why I no longer participate, losing interest, etc.
2) Buyers fees are irrelevant when buying and the net return to a reasonably educated seller is still 87-92%, get over it.
3) Just go to Great Collections

What am I missing so we can get them out of the way now and avoid the drama?

topstuf

Possibly to stem the outflow?

WHY am I so suspicious?

brg5658

Money-grubbing, auction house price fixing, plain and simple.

If you're buying and assume that everyone you're bidding against will take the 20% into account for their max bid, you're deluding yourself. So, you will feel this as a buyer.

If you're selling, this is just a bigger cut for the auction house, and less for you.

Win-win for HA, we all lose. They are making money hand over fist, and their argument that raising their BP makes them more competitive with other auctioneers makes absolutely ZERO logical sense.

TopoftheHill

Heritage shipping fees are the highest of any auction house in my opinion. In addition, they have a calculator on site that purports to show how shipping fees are calculated. Several times I have added up what the shipping charges should be based on their site, and I am charged a few dollars more. May not sound like much, but it does add up! My one email request for an explanation went unanswered. Oh, I did call once about this, and was told they would get back to me....never happened.

BillJones

This is bad news indeed, although not unexpected. It is making me re-think about how I am going to dispose of my collection. Higher buyers’ fees lower hammer prices. Sure you might get a kick back if you are big consigner, but the fact remains that the bids will be lower overall. Yes that are Yahoos who ignore the fee, but there are not enough of them to really avoid lowering the hammer prices.

I am also PO’d by the fact that the two major auction houses are acting in concert. I think that there should be an investigation of this. It’s obvious that one is acting together with the other.

bronco2078

No one at Heritage knows what the word competitive means apparently. Just a thought but to compete you might want to keep your fee lower . Are buyers calling them and complaining the fee is too low?

ShadyDave

@BillJones said:

I am also PO’d by the fact that the two major auction houses are acting in concert. I think that there should be an investigation of this. It’s obvious that one is acting together with the other.

https://www.ftc.gov/faq/competition/report-antitrust-violation

brg5658

If Great Collections keeps their BPs the same, this should drive a ton of business to them. I will be regularly viewing their offerings more than Heritage from now on.

I think it's simply sick that these greedy H-A-holes keep pushing the limits of sanity -- 2.5% at a time eventually adds up, and there's a threshold beyond which any sane person will simply not go. Heritage is getting dangerously close to that IMO. Justifying it by quoting higher BPs from other greedy companies doesn't change the fact that it's just wrong.

It's like the Heritage kids in the back-seat screaming "But Stacks started it..." don't make me pull this car over!

REALGATOR

I'm sure consignors love getting $200 under melt for their graded Saints.

ARCO

Coin collecting for me is now collecting pics. It is a helluva lot cheaper on the buy side, and a helluva lot easier on the sell side (all I have to do is delete the pic). I own all of the most beautiful and expensive coins now.

Funny thing really, I rarely look at my physical coins except via my pics. Owning a coin seems to be a mental thing really.

ARCO

Coin collecting for me is now collecting pics. It is a helluva lot cheaper on the buy side, and a helluva lot easier on the sell side (all I have to do is delete the pic). I own all of the most beautiful and expensive coins now.

Funny thing really, I rarely look at my physical coins except via my pics. Owning a coin seems to be a mental thing really.

Coinstartled

@MANOFCOINS said:
Despicable

Why?

Great Collections came in 5 or 6 years ago with much lower rates and much better service and cleaned up. $1000 coin ships for $10 and not $30.

I have only consigned 2 items to Heritage and was disappointed both times. Buying from them though has been a generally very good experience.

Plenty of competition in the auction channel and if you can't find an equitable house for liquidation of your coins, that is your problem, not Heritage.

Coinstartled

Only objection would be if the current consignors were not aware of the hike.

Coinstartled

quintuple post.

Coinstartled

quadruple post....

tommy44

@REALGATOR said:

This was not a decision that we came to lightly. Heritage is a major player on the world auction stage, and our BP rates will now be competitive with the rest of the world's key auctioneers.

Higher rates will be more competitive? For who? Am I missing something here?

Coinstartled

@BillJones said:
This is bad news indeed, although not unexpected. It is making me re-think about how I am going to dispose of my collection. Higher buyers’ fees lower hammer prices. Sure you might get a kick back if you are big consigner, but the fact remains that the bids will be lower overall. Yes that are Yahoos who ignore the fee, but there are not enough of them to really avoid lowering the hammer prices.

I am also PO’d by the fact that the two major auction houses are acting in concert. I think that there should be an investigation of this. It’s obvious that one is acting together with the other.

Look up the story of A. Alfred Taubman when he ran Sotheby's

icsoccer

Next stop 25%. I already pay this at an 'art' auction house.

golden

More greed!

Manorcourtman

I agree with the poor descriptions beef. I was not happy with my results from the ANA auction. Should have just sold them at Great Collections and saved some money and got my money faster.

franklin200

I see a lot of bullion related coins on Heritage like proof gold/platinum eagles, first lady coins etc. Consignors must be taking a big loss on these types of coins.

TommyType

I get the theory that "It doesn't matter. Bidding adjusts." Fine.

But I think more and more the "BIG" auction houses are pricing themselves out of the "collector grade" coins. (Euphemism for "Cheap Coins").

There was a time when I could find a number of items of interest to me in their "Signature Sales" that were affordable. Now, I barely look at those sales. I mainly look at their weekly, "too cheap for a real auction", lots. But with $19 minimum fees, and 20%, there's very little ROOM for bidding.

Maybe that's what Heritage wants? Cheap coins are too much work.

Thank goodness for Great Collections.

LindeDad

Told them to take me off the email list, anybody else with that kind of BP will get the same from me.

oih82w8

"This was not a decision that we came to lightly. Heritage is a major player on the world auction stage, and our BP rates will now be competitive with the rest of the world's key auctioneers." In other words, "if they (competitors) can do it (raise their fees), we can do it"

I will just bid lower to incorporate the uptick. Agreed that the sellers will lose out as well due to lower hammer prices.

Greeniejr

I am sure people will lower their bid accordingly. HA and SB are not colluding but they have to respond to reality. Both companies have keep their rates in line with one another. The question will be whether smaller boutique auctions do the same. This change is not necessarily aimed at us, rather it is aimed at people outside our industry who are selling their family's collection.
Assume all things are equal such as customer service, timing, photography, liquidity, etc. between the two firms. In reality they are clearly not but for this thought exercise work on that assumption. Now lets say HA kept their rate at 17.5% and SB was at 20%. Lets say you have your family's collection worth $10 million and are willing to go in unreserved. You go to Heritage and they offer you 108%. You go to SB and they offer you 110% of hammer. Most people out there have no experience with auctions would jump at SB because they are getting a "better deal" at 110% of hammer. In reality doing the math you would be getting $28,000 less going with SB. So by moving in response to SB, they are making a necessary change to compete for the non-numismatic clients. Another note; you can switch who changed first and it would not change the analysis.

jmlanzaf

Totally a non-factor for any reasonably numerate bidder. Anyone who bids $1000 for a $1000 coin and is then surprised/angry/disappointed with the $1200 bill should spend $5 on a calculator. If it's a $1000 coin, you don't bid more than $830 so your final bill is $1000.

Large dealers typically pay negative 3% to negative 5% as a seller's premium. Their standard is 10%, but it is pretty easy to get it waived just by asking. If you have a million dollar coin, you can probably negotiate a negative 10% rate or even more, as they want the prestige associated with handling such a coin. Yes, NEGATIVE. The main reason for increasing the buyer's premium is to allow the auction house to make more generous offers to consignors while maintaining margins. The extra 2.5% is likely going to dealers not Heritage.

Coinstartled

@franklin200 said:
I see a lot of bullion related coins on Heritage like proof gold/platinum eagles, first lady coins etc. Consignors must be taking a big loss on these types of coins.

More likely they are owned by Heritage.

TommyType

@Greeniejr said:
Assume all things are equal such as customer service, timing, photography, liquidity, etc.....

Good concise description for the "Why they had to". As noted, it has little to do with the buyers....(If WE had the clout, there would be zero buyers fee, and they would haggle the cut with the sellers!).

But in their little kitchen, it's the sellers who are really introducing the flour (money) into the mixer. The buyers will predictably come along later for a bit of crust.... (Too much? )

Coinstartled

@Greeniejr said:
Now lets say HA kept their rate at 17.5% and SB was at 20%. Lets say you have your family's collection worth $10 million and are willing to go in unreserved. You go to Heritage and they offer you 108%. You go to SB and they offer you 110% of hammer. Most people out there have no experience with auctions would jump at SB because they are getting a "better deal" at 110% of hammer.

If said proverbial widow waltzes in with $10,000,000 of Herb's collection, the difference in return can easily be explained as the concept of hammer and 108% of hammer.

I suspect that the high payrolled auction houses are feeling the squeeze of a declining market and are trying to enlarge the shrinking pie with higher fees. Doubt that it will be effective as coin people are generally pretty wise.

BillJones

@Coinstartled said:

@BillJones said:
This is bad news indeed, although not unexpected. It is making me re-think about how I am going to dispose of my collection. Higher buyers’ fees lower hammer prices. Sure you might get a kick back if you are big consigner, but the fact remains that the bids will be lower overall. Yes that are Yahoos who ignore the fee, but there are not enough of them to really avoid lowering the hammer prices.

I am also PO’d by the fact that the two major auction houses are acting in concert. I think that there should be an investigation of this. It’s obvious that one is acting together with the other.

Look up the story of A. Alfred Taubman when he ran Sotheby's

I don't like Sotheby's one bit. I have no desire to do business with them on any level.

JBatDavidLawrence

I'm not sure that any of the major dealers in the hobby were surprised by this. When the market slows down and consignments are harder to come by, you have to raise your margins, even if just half of a percent. It's not an easy business!

Unfortunately, it surely doesn't make things easier as a buyer (even though 20% is easier to figure than 17.5%).
Now for the self-promotion, this is exactly why we removed a buyer's fee and shipping charges years ago. It simply adds transparency and makes the process easier to understand, from a buyer's standpoint...

davewesen

does that mean sellers fee is dropped (if you have big consignment)? or are they still taking from both ends?

brg5658

@Greeniejr said:
I am sure people will lower their bid accordingly. HA and SB are not colluding but they have to respond to reality. Both companies have keep their rates in line with one another. The question will be whether smaller boutique auctions do the same. This change is not necessarily aimed at us, rather it is aimed at people outside our industry who are selling their family's collection.
Assume all things are equal such as customer service, timing, photography, liquidity, etc. between the two firms. In reality they are clearly not but for this thought exercise work on that assumption. Now lets say HA kept their rate at 17.5% and SB was at 20%. Lets say you have your family's collection worth $10 million and are willing to go in unreserved. You go to Heritage and they offer you 108%. You go to SB and they offer you 110% of hammer. Most people out there have no experience with auctions would jump at SB because they are getting a "better deal" at 110% of hammer. In reality doing the math you would be getting $28,000 less going with SB. So by moving in response to SB, they are making a necessary change to compete for the non-numismatic clients. Another note; you can switch who changed first and it would not change the analysis.

So, in essence, what you're saying is that this BP hike gives the auction companies more "back-room-dealings" wiggle room for enticing sellers to go with them. Sounds about right for coin dealers / auction houses.

Coinstartled

@JBatDavidLawrence said:
I'm not sure that any of the major dealers in the hobby were surprised by this. When the market slows down and consignments are harder to come by, you have to raise your margins, even if just half of a percent. It's not an easy business!

Unfortunately, it surely doesn't make things easier as a buyer (even though 20% is easier to figure than 17.5%).
Now for the self-promotion, this is exactly why we removed a buyer's fee and shipping charges years ago. It simply adds transparency and makes the process easier to understand, from a buyer's standpoint...

Kudos to you for dropping the buyers fee. It does make bidding easier.

As far as the auction houses raising fees to shore up sagging volume, that runs counter to any economics that I have encountered and can end in disaster if the volume declines further as a result of the pricing action. Wishing them luck.

ms70

I just deleted my HA bookmark. I don't see any reason to visit there anymore.

Jackthecat1

I'm glad I won a lot in their auction Sunday. I just saved myself 2.5%.

AMRC

Not a good time to be a seller.

Coin Finder

Simply put I will just have to bid less for a coin I want...

Boosibri

Great marketing opportunity for specialist dealers as an alternative outlet for buying and selling coins.

roadrunner

@REALGATOR said:
I'm sure consignors love getting $200 under melt for their graded Saints.

Don't consign them for auction. Sell them outright to Heritage, Rarcoa, and others who routinely buy out-right with spreads of 4-7%. These have no business being in an auction unless they're rare dates or rare grades.

It's odd. As buyer's fees have increased from 10% to 17.5% over the years, I netted more from my consignments....and when buying....saw no effect of prices.

roadrunner

@AllCoinsRule said:
I don't think it's a much of a coincidence that Superior and ANR went out of business, and that Stacks and Bowers/Merena had to merge around the time grading standards tightened about 12 years ago. The question is who will or won't survive the next tightening.

The reason being that over the past 15-20 years their competition was a growing Heritage. Which is squeezing all of them as they made the transition first to a modern auction house...while keeping the pedal to the metal.