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Heritage's Buyer's Premium
pmac
Posts: 3,189 ✭✭✭
Heritage, as of May 14th, has upped their minimum premium to $19 from $14. Cheap coins have become a little more expensive.
Paul
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pmac
Posts: 3,189 ✭✭✭
pmac
Posts: 3,189 ✭✭✭
Comments
Heritage, as of May 14th, has upped their minimum premium to $19 from $14. Cheap coins have become a little more expensive.
They have only become more "expensive" for the consignors who now pay a "possible" extra $5 more than before. Bidders will adjust their bids lower by approx $5 to ensure the consignor foots that increase, not them. I know I would. If a coin is worth $50 or a $100 I'm only going to bid the appropriate amount such that my final invoice # with all fees included comes out to be no more than $50 or $100. My net cost hasn't changed one bit.
In the end, it's just Peter the consignor "trying" to rob from Paul the bidder, hoping Paul is not smart enough to adjust his bid $5 lower. For 90-95% or more of bidders, this will make zero difference. For 95% of small consignors, it's probably another $5 per coin out of their pockets. Some smaller consignors might go elsewhere if they have lots of coins valued at $25-$100. That additional 5-20% might be the break point to sell outright to a dealer.
Net effect: it's now a little more expensive to consign cheap coins to Heritage. Which in the end may mean less cheap coins available to smaller pocketed buyers.
Well, at least they have not jacked up the BP to 20% (yet)
Again, it's just an "adjustment" that plays little role in 95% of transactions. This would only "catch" clueless consignors and bidders....a small win for the auction house. And for coin that are very hard to price, or show up infrequently, bring multiples of estimates, etc....the buyer's fee could literally get totally "lost" in the process where no one knows who really paid it....not that it matters at that point.
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
Oddly, there is no limit to how high buyer's fees could be. Pick 1,000% or 10,000%. In the end I might have to end up bidding $100, $10, $1, or even 10c on a $1,000 coin....and end up being invoiced for a net total of $1,000 in each case. Govt regulators probably wouldn't allow that to happen considering a newbie bidder could inadvertently bid $100 on a $100 coin and end up owing the auction house $10,000. That wouldn't quite be fair. I have paid buyer's fees a few times 10-30 years ago. In each of those instances I was floor bidding on the fly and just forgot to factor out the BF.
Well, at least they have not jacked up the BP to 20% (yet)
Again, it's just an "adjustment" that plays little role in 95% of transactions. This would only "catch" clueless consignors and bidders....a small win for the auction house.
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
Oddly, there is no limit to how high buyer's fees could be. Pick 1,000% or 10,000%. In the end I might have to end up bidding $100, $10, $1, or even 10c on a $1,000 coin....and end up being invoiced for a net total of $1,000.
Spot on, it's low enough under the radar that most bidders won't notice or even care about the increase.
Well, at least they have not jacked up the BP to 20% (yet)
Again, it's just an "adjustment" that plays little role in 95% of transactions. This would only "catch" clueless consignors and bidders....a small win for the auction house. And for coin that are very hard to price, or show up infrequently, bring multiples of estimates, etc....the buyer's fee could literally get totally "lost" in the process where no one knows who really paid it....not that it matters at that point.
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
Oddly, there is no limit to how high buyer's fees could be. Pick 1,000% or 10,000%. In the end I might have to end up bidding $100, $10, $1, or even 10c on a $1,000 coin....and end up being invoiced for a net total of $1,000 in each case. Govt regulators probably wouldn't allow that to happen considering a newbie bidder could inadvertently bid $100 on a $100 coin and end up owing the auction house $10,000. That wouldn't quite be fair. I have paid buyer's fees a few times 10-30 years ago. In each of those instances I was floor bidding on the fly and just forgot to factor out the BF.
Sure, consigners may get a larger percent of hammer, but I doubt if they get the full 2.5% every time the BP is jacked up, otherwise Heritage would not do it.
Well, at least they have not jacked up the BP to 20% (yet)
Again, it's just an "adjustment" that plays little role in 95% of transactions. This would only "catch" clueless consignors and bidders....a small win for the auction house.
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
Oddly, there is no limit to how high buyer's fees could be. Pick 1,000% or 10,000%. In the end I might have to end up bidding $100, $10, $1, or even 10c on a $1,000 coin....and end up being invoiced for a net total of $1,000.
Spot on, it's low enough under the radar that most bidders won't notice or even care about the increase.
They care... notice the rise was stopped under $20 which may be the tipping point
Well, at least they have not jacked up the BP to 20% (yet)
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
I can assure you that consignors aren't going to sell $1,000 coins for $500-$600 either.
MY COINS FOR SALE AT https://www.pcgs.com/setregistry/collectors-showcase/other/bajjerfans-coins-sale/3876
Essentially, for a $14 minimum buyer's fee, it only applies to a hammer price of $80 or less. ($80 x 17.5% = $14.00)
For a $19 minimum buyer's fee, it only applies to a hammer price of less than $109. ($109 x 17.5% = $19.07)
So, the question is, how many coins do they sell for less than $80 vs. less than $109?? Not that many, I'm guessing. Certainly not in their BIG auctions, so it only matters in the weekly auctions.
And for material that small, Heritage probably isn't your first choice to begin with. GC, or Ebay, or any message board sales site make more sense....
Seems to be more a matter of attempting to limit the time and effort they put into low end inventory, and instead concentrating on what they do best?
No big deal in the big picture.
Latin American Collection
I wish they would up the premium to 20% so it's easier for me to figure bits in my head
That's quite possibly the dumbest reason ever.
Aren't you an accountant?
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My sets: [280+ horse coins] :: [France Sowers] :: [Colorful world copper] :: [Beautiful world coins]
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Here what is being done is that coins that are only worth $15 will not sell.
An item must now sell for a minimum of $20 all in ($1+$19minimum)
BTW they do have a eBay outlet that handles a lot of the cheaper items. It does not charge any Premiums.
Their eBay presence handles coins that Heritage owns, not consignments. That is the reason they gave me for stating that they will not sell coins on eBay to Minnesota residents (because of the idiotic "bullion law" in place here), but items in their auctions were consigned, so they were not bound to the Minnesota law.
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My sets: [280+ horse coins] :: [France Sowers] :: [Colorful world copper] :: [Beautiful world coins]
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I'm sure if you volunteered to pay a 20% BP, they wouldn't object.
Member ANA, SPMC, SCNA, FUN, CONECA
Well, at least they have not jacked up the BP to 20% (yet)
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
I can assure you that consignors aren't going to sell $1,000 coins for $500-$600 either.
You couldn't have read the entire post. $1,000 coins will typically sell for $1,000 REGARDLESS of the posted seller's and buyer's fee.....period. This is the whole point. Nothing really changes as fee structures change and consignors negotiate acceptable terms and bidders alter their bids accordingly.
On a 100% buyer's fee on a $1,000 coin I would bid $500. The seller will still get something around $850-$925 net. My invoice will show $500 bid + $500 buyer's fee. I still pay the same $1,000. The seller gets about 90% of that $1,000. Why is the top of auction fees so hard to understand?
I wish they would up the premium to 20% so it's easier for me to figure bits in my head
That's quite possibly the dumbest reason ever.
Aren't you an accountant?
Not dumb at all. It's actually quite astute and indicates Boosibri understands the auction fee structures perfectly....and Brg5658 does not. I'm not an accountant, but do have a 4 yr mathematics degree with honors. This isn't rocket science.
A 16.66% buyer's fee would actually be easier than a 15% one as you just have to divide by 6 and add it on to your bid. We'll all get our wish eventually as a 20% buyer's fee is quite likely someday.
RR-
Here what is being done is that coins that are only worth $15 will not sell.
An item must now sell for a minimum of $20 all in ($1+$19minimum)
anyone selling coins under $65 ... will be big losers with new juice rate
Well, at least they have not jacked up the BP to 20% (yet)
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
I can assure you that consignors aren't going to sell $1,000 coins for $500-$600 either.
You couldn't have read the entire post. $1,000 coins will typically sell for $1,000 REGARDLESS of the posted seller's and buyer's fee.....period. This is the whole point. Nothing really changes as fee structures change and consignors negotiate acceptable terms and bidders alter their bids accordingly.
On a 100% buyer's fee on a $1,000 coin I would bid $500. The seller will still get something around $850-$925 net. My invoice will show $500 bid + $500 buyer's fee. I still pay the same $1,000. The seller gets about 90% of that $1,000. Why is the top of auction fees so hard to understand?
I don't know why. Though you are beating a dead horse.
My 1866 Philly Mint Set
Not true. The seller will get 90% of the hammer price. Not the total sale. Heritage would keep the entire buyers premium! You get none of the buyers premium. In your example the seller would receive 90% of the 500 dollar hammer!
Not true. The seller will get 90% of the hammer price. Not the total sale. Heritage would keep the entire buyers premium! You get none of the buyers premium. In your example the seller would receive 90% of the 500 dollar hammer!
I think most people assume that a significant portion of the buyers fee is also kicked back to the seller. I don't have the experience to back that up....but many here do.
I have a feeling that the smaller your consignment is ($$ wise), the less pull you have to actually make that happen, however....
But, you know, for me the whole buyers fee isn't what keeps me from winning lots. I'm on level ground with everyone else. It's the fact that I'm in CA, and have to figure in sales tax as well!!
I got shut out on a couple of Heritage lots this weekend....so to soothe my ego, I bought a couple of coins from an East Coast dealer. No sales tax collected, and I feel better.
On a 100% buyer's fee on a $1,000 coin I would bid $500. The seller will still get something around $850-$925 net. My invoice will show $500 bid + $500 buyer's fee. I still pay the same $1,000. The seller gets about 90% of that $1,000. Why is the top of auction fees so hard to understand?
Not true. The seller will get 90% of the hammer price. Not the total sale. Heritage would keep the entire buyers premium! You get none of the buyers premium. In your example the seller would receive 90% of the 500 dollar hammer!
Not true. I've "netted 90-92% on all my auction consignments of the past 10 years. I would imagine most consignments of $10K or more could easily do something in the 87-92% range...or an average of 90% net. Clearly, I've negotiated away all of the seller's premium (10%) and some of the buyer's (17.5%) premium as well. This is fact, not idle forum chit chat. Don't believe everything you read. Go on line and read about buyer's fees, especially at the big art houses. You will never find anyone stating that this comes out of the seller's pocket. The auction houses and even those who review auction prices like to keep the "appearance" up that buyer's really pay this premium.
Seller's never get "only" 90% of the hammer price, unless they stupidly accept a 10% seller's fee and negotiate none of the 17.5% buyer's fee away. My deals have always been hammer+4% to hammer+6%....and that was with a 15% buyer's fee in effect. That's a 90% net. In the days of 17.5% buyer's fee I'd have to up to that a min of 106% of hammer. They raise the buyer's fee....and consignor's will negotiate successfully for more above hammer.
For those with low level consignments, or very common material the auction house really doesn't care all that much about, you just might have to accept FULL fees (ie net 90/117.5 or 76.5%). But, I don't know of anyone who ever settled for such a lousy deal. It would be better to sell stuff outright than take 76.5% of what an auction "might" bring. Or use a different auction venue like GC. You should never go to auction to net 76%.
Since first consigning in auctions in the mid-1980's I've never realized less than a net of 87%. These days I won't even bother if I can't net 90% after the sale. You think a consignor with a top level $1+ MILL collection is going to accept 90% BELOW hammer? Get real. 10% ABOVE hammer might more realistic. Pogue may have negotiated even higher, especially on something like the 1804 dollar which could have its own "deal." Sometimes the auction house will allow big dollar coins in at nearly 0% commission just to draw others to the sale. Favored dealers who routinely consign would likely be given favored rates as they often help to "fill out" the sales. I'd expect them to net 92-94%.
I wish I would have came to these boards earlier. I consigned with heritage 1 time. It was for about 20,000. I was able to negotiate the sellers fee down to 8%. I did not even know you could negotiate the buyers fee. I have a lot to learn as I obviously left some money on the table!
That's why they have buyer's fees, to confuse both the consignors and a small percentage of the bidders. For a $20K consignment you should have netted nothing less than 85-88% imo. That's hammer to H+2 to +3%. The auction venue plays a role too. For a "hot" auction like FUN or summer ANA they cut a couple % off as they have many lots vying to be in those sales.
You can negotiate almost anything into an auction contract if you have the material they want. On my 2004 contract, I negotiated which 3 auctions were the only ones allowed (Long Beach, summer ANA, Jan. FUN), platinum night only for 2 lots, full page spread and half page spread for those 2 lots. I didn't want those lots showing up in any smaller sale in East Oshkosh where they wouldn't get top exposure and there wasn't a top show attached with the auction.
Your net with an 8% sellers fee and full 17.5% BF was 92% of hammer....or 92/117.5 = 78% net. Last time I was talking with Stacks Bowers they were offering a few percent above hammer for a decent $20K consignment. 78% for $20K worth of coins worth $100-$250 each might have only been worth about 80% to the house. But if those were 40-$500 coins or better yet, 20-$1,000 coins, I think 86% or better should have been achievable. I haven't consigned in a couple years so maybe Heritage is turning stuff away if they can't dictate the rates. 78% on $20K seems real low imo unless it was a boxes of circ wheat cents.
I was told if I brought 40,000 worth of coins he would go down to 7%. Do you think this happens to a lot of people? Or did my salesperson just see a fish and take advantage of me!
In the coin biz, if you show weakness or lack of knowledge, they aren't going to educate you. So sure, they'll take whatever they can from you. Imagine an unknowledgeable person handling a major estate with a $500K coin collection and gets told the deal is 10% seller's fee. And they probably think they get 90% NET because the buyer's fee shows up on the bidder's invoice. They still pay it though. When the final paper work shows up they will have netted 76%....and might think they did good. Don't do anything major in this hobby without getting information from a trusted source who has your concerns in mind. Smoke and mirrors rules.
There's always an option to send your lots to a dealer "pooler" who typically does this. Those guys might pool lots from a dozen different consignors and then go to the auction house with a $250K consignment and get the best rate. The individual consignors will likely get more than if they did it on their own.
I think what happened to you happens to most everyone who consigns for the first time and hasn't discussed this through with a dealer/collector mentor. It usually helps to know what the other 1-3 major houses are offering so you know if you're being kept out in left field. I can't say I'm current in what net fees are achievable today. But, I cannot believe they've changed all that much in just the past 4 years. My nets were steady from 1987-2012. Why would it be so different now, especially with the market generally being weak the past year or so.
My first deal with Heritage in 2004 was $80K and I took the hammer+2% they offered without a real whimper. I netted 88.7%. But the key was those coins were in the right auction at the right time and brought about 25% more than I thought they would or could. I needed the exposure of a major auction/show than just a great rate. And they got great exposure as I wrote into my contract. And I needed to get them sold that year. So I was quite happy with that result even if the coins deserved hammer +4% (15% BF back then). The agreed upon reserves on those coins were set very conservatively which they must have loved. Fortunately, that played no role as they brought about 2X the reserve prices. I did ask for more than initially offered and they just sort of said not unless I give them $250K. There's always more than 1 auction house though. If you can net 90% somewhere else, why accept 80% from the big guy?
If we end up getting down to only one viable auction house, it's really going to be hard to get good rates. GC is doing a great job though for most everything valued at 4 figures or less ($9999). I watched their auctions in April very closely for the first time ever as they had a major offering of seated material from a nice collection. I tried over 3 auctions to cherry pick a few pieces and couldn't win a single lot, even the ones I stretched on. They brought top dollar almost without exception. My total bids must have been in the $25K range and a few dozen lots. Won nada.
Great job by GC getting great prices for consignors. I just might consider them in the future for anything in the $100-$5,000 per coin consignment range. On a couple of lots in the $2K to $5K range I was the under-bidder and just could not move the top guy out of the way. I just gave up rather than risking paying 100% retail or more. I much prefer paying within 10% of wholesale. Some seated coins I thought I knew the values of cold brought 2X my estimate! That's my plug for Great Collections. And I had I though I could easily pick off some coins I knew were underrated. WRONG! I got schooled at GC.
And, yes, roadrunner, this applies to you. You can write your posts all you want, but as a bidder I know the reality and reality sucks. It is making this hobby less enjoyable for me. I pay more for almost every lot I buy, and I figure I'll get hurt when it comes time to sell my collection.
And for record, Heritage will raise their buyers' when Stacks' raisers theirs.
Wondercoin.
I wish they would up the premium to 20% so it's easier for me to figure bits in my head
That's quite possibly the dumbest reason ever.
Aren't you an accountant?
Not dumb at all. It's actually quite astute and indicates Boosibri understands the auction fee structures perfectly....and Brg5658 does not. I'm not an accountant, but do have a 4 yr mathematics degree with honors. This isn't rocket science.
A 16.66% buyer's fee would actually be easier than a 15% one as you just have to divide by 6 and add it on to your bid. We'll all get our wish eventually as a 20% buyer's fee is quite likely someday.
My point was that 20% is no simpler to take into account than 17.5%.
Oh and congrats on your math degree with honors. I graduated top 1%, Phi Beta Kappa, with a 4-year math degree and have a graduate degree. /eyeroll/ This is a matter of remedial grade school math, not abstract algebra.
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My sets: [280+ horse coins] :: [France Sowers] :: [Colorful world copper] :: [Beautiful world coins]
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Higher buyers' fees nail sellers and buyers. You can argue all you want about how the higher buyers' fees only hurt the consigners, but I can tell you as a bidder that it hurts us too. There are "win at any bid" people who totally ignore the buyers' fees and keep going to beyond retail. I'm tired of reading about the bidders sitting there with their calculations busting back their bids because of the buyers', but the truth is a large number of them don't care.
And, yes, roadrunner, this applies to you. You can write your posts all you want, but as a bidder I know the reality and reality sucks. It is making this hobby less enjoyable for me. I pay more for almost every lot I buy, and I figure I'll get hurt when it comes time to sell my collection.....
I can't help it Bill if you tend to bid on coins that have insatiable collector demand from bidders who will pay whatever it takes to win the lot every time out. Sounds like whales to me. No one forces you to collect in the area you do. There are plenty of areas in the coin market that are at much lower levels of demand and competition. If it were me, I'd either stop bidding or find a new area to collect in. There are always opportunities where the market is currently "cold." Choice/gem seated, bust, and barber type is currently pretty weak. Type choice/gem gold is still weak. But better type early bust/federal VF-AU's continue to be strong. I still think the quest for totally problem free, hotly contested type coins (I think an 1839-0 half for example) isn't properly reflected in current price guides. So the final auction price "always" seems like it's 15-40% "too high." When "perfect" material is desired, expect to pay "perfect" prices where no there is no real guide to help you. Rather than blame it on the auction fees, blame it on insatiable market demand for perfect coins, especially those headed into Registry and Everyman sets.
Thanks for Wondercoin for some insights on pooling consignments. Feel free to become a client if you don't want to settle for 76-80% net. Mark Feld used to do this though I don't know his current status. Colonel Jessup offered to do this for me at a major summer ANA sale where I thought it might get me a top rate due to his stronger connections. But, being the straight shooter he is, he told me the sale was "hot" and nearly full that the rate I would get on my own was probably the best that could be done. The time for giving deals was already passed. So I went with that. Venue plays a big role.
My point was that 20% is no simpler to take into account than 17.5%.
I can do 20% in my head. No calculator needed. I cannot do 17.5%, nor do I care to practice and learn how. For me, round numbers are "simpler" when you are thinking on your feet on the auction floor with only a couple seconds to make a bid decision on a lot you didn't fully scope out beforehand. A 10% or 20% buyer's fee would make it a lot easier, and less chance for a mistake.
Well, at least they have not jacked up the BP to 20% (yet)
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
I can assure you that consignors aren't going to sell $1,000 coins for $500-$600 either.
You couldn't have read the entire post. $1,000 coins will typically sell for $1,000 REGARDLESS of the posted seller's and buyer's fee.....period. This is the whole point. Nothing really changes as fee structures change and consignors negotiate acceptable terms and bidders alter their bids accordingly.
On a 100% buyer's fee on a $1,000 coin I would bid $500. The seller will still get something around $850-$925 net. My invoice will show $500 bid + $500 buyer's fee. I still pay the same $1,000. The seller gets about 90% of that $1,000. Why is the top of auction fees so hard to understand?
I don't know why. Though you are beating a dead horse.
That dead horse keeps coming back to life as can be seen after your post, not to mention before.
I'm glad roadrunner keeps going over it as all I have to do is yell at the screen instead of actually typing in what he already keeps pointing out.
"To Be Esteemed Be Useful" - 1792 Birch Cent --- "I personally think we developed language because of our deep need to complain." - Lily Tomlin
As a dealer you can bid on the quiet areas of the market and be happy. When I was a dealer I knew what that was like. As a collector you can't buy stuff because it's cheap unless it is so cheap that it is like a "give away." A collector buys the coins he or she enjoys. When you are a collector, selling coins to dealers are good prices is hard. Many dealers think they are "entitled" to buy coins from collectors at low prices. They pay much less to "the public" than they do to other dealers.
When the buyers' fee was 15%, the auctions were more viable for me. When they went to 17.5%, a lot of the fun went out of it. When they go to 20 or 25%, it will be over for me.
The Heritage political items rate is 25%. That has priced them out of the market for me. There are a number of other political items auctions where I can buy the same items for less. Their buyers' are 12.5 to 15%. It does not matter to Heritage however. They have many clients who bid as if the 25% surcharge was not even there. It must be wonderful to have that kind of customer base.
I hope SB stays strong. It will make HA better. Same for NGC and PCGS.
Well, at least they have not jacked up the BP to 20% (yet)
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
I can assure you that consignors aren't going to sell $1,000 coins for $500-$600 either.
You couldn't have read the entire post. $1,000 coins will typically sell for $1,000 REGARDLESS of the posted seller's and buyer's fee.....period. This is the whole point. Nothing really changes as fee structures change and consignors negotiate acceptable terms and bidders alter their bids accordingly.
On a 100% buyer's fee on a $1,000 coin I would bid $500. The seller will still get something around $850-$925 net. My invoice will show $500 bid + $500 buyer's fee. I still pay the same $1,000. The seller gets about 90% of that $1,000. Why is the top of auction fees so hard to understand?
I did read it. A consignor consigns a coin to Heritage. The coin has a market value of $1,000. Under your scenario of 100% juice, you are going to bid $500. Let's say the coin sells for $500, so the hammer price is $500. In order for the consignor to get $900, he would have to get 180% of hammer.
""We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were.""
I don't see any 180% in your quoted text. $500 hammer + 5-12% would get the consignor $525 - $560 as I figure it.
If Heritage raises the buyer's premium, I'd like to think it's because they are looking to increase revenue, not just plow it back to consignors. Of course if they did bump the juice to 100% they'd get a lot more from consignors who don't negotiate. Why would they up the juice just to negotiate it away?
Your numbers don't wash. My comment stands.
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Well, at least they have not jacked up the BP to 20% (yet)
We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were. In fact, most of us would probably prefer a 20% BF as the math is easier and you can do it on the fly. This 17.5% stuff is for the birds.
I can assure you that consignors aren't going to sell $1,000 coins for $500-$600 either.
You couldn't have read the entire post. $1,000 coins will typically sell for $1,000 REGARDLESS of the posted seller's and buyer's fee.....period. This is the whole point. Nothing really changes as fee structures change and consignors negotiate acceptable terms and bidders alter their bids accordingly.
On a 100% buyer's fee on a $1,000 coin I would bid $500. The seller will still get something around $850-$925 net. My invoice will show $500 bid + $500 buyer's fee. I still pay the same $1,000. The seller gets about 90% of that $1,000. Why is the top of auction fees so hard to understand?
I did read it. A consignor consigns a coin to Heritage. The coin has a market value of $1,000. Under your scenario of 100% juice, you are going to bid $500. Let's say the coin sells for $500, so the hammer price is $500. In order for the consignor to get $900, he would have to get 180% of hammer.
""We can have a 100% "buyer's" fee for all I care. For a $1,000 coin I would bid $475-$500. Most consignors would still negotiate a net of "hammer + (5-12%) to keep things right about where they were.""
I don't see any 180% in your quoted text. $500 hammer + 5-12% would get the consignor $525 - $560 as I figure it.
If Heritage raises the buyer's premium, I'd like to think it's because they are looking to increase revenue, not just plow it back to consignors. Of course if they did bump the juice to 100% they'd get a lot more from consignors who don't negotiate. Why would they up the juice just to negotiate it away?
Your numbers don't wash. My comment stands.
Well said BAJJER.
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My sets: [280+ horse coins] :: [France Sowers] :: [Colorful world copper] :: [Beautiful world coins]
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Haven't seen any change at Great Collections just in case anyone cares.
I think their S&H went from $3 to $4.
Don't get me wrong. I'm a big GC fan.
"If I say something in the woods and my wife isn't there to hear it.....am I still wrong?"
My Washington Quarter Registry set...in progress
Heritage, as of May 14th, has upped their minimum premium to $19 from $14. Cheap coins have become a little more expensive.
SB has had a $19 minimum BP for a while now. I think HA are just playing catchup.
I wish they would up the premium to 20% so it's easier for me to figure bits in my head
That's quite possibly the dumbest reason ever.
Aren't you an accountant?
Not dumb at all. It's actually quite astute and indicates Boosibri understands the auction fee structures perfectly....and Brg5658 does not. I'm not an accountant, but do have a 4 yr mathematics degree with honors. This isn't rocket science.
A 16.66% buyer's fee would actually be easier than a 15% one as you just have to divide by 6 and add it on to your bid. We'll all get our wish eventually as a 20% buyer's fee is quite likely someday.
I'm not an accountant but that really doesn't matter. The point of my statement was to convey how irrelevant the BP is to me as a bidder.
As a seller when I haven't had a consignment size to have any leverage in a negotiation I have just used a trusted dealer who does and net out 90%+ regardless of the BP structure.
Latin American Collection
I wish they would up the premium to 20% so it's easier for me to figure bits in my head
That's quite possibly the dumbest reason ever.
Aren't you an accountant?
Not dumb at all. It's actually quite astute and indicates Boosibri understands the auction fee structures perfectly....and Brg5658 does not. I'm not an accountant, but do have a 4 yr mathematics degree with honors. This isn't rocket science.
A 16.66% buyer's fee would actually be easier than a 15% one as you just have to divide by 6 and add it on to your bid. We'll all get our wish eventually as a 20% buyer's fee is quite likely someday.
I'm not an accountant but that really doesn't matter. The point of my statement was to convey how irrelevant the BP is to me as a bidder.
As a seller when I haven't had a consignment size to have any leverage in a negotiation I have just used a trusted dealer who does and net out 90%+ regardless of the BP structure.
90%? You are being hoodoo'd
Heritage, as of May 14th, has upped their minimum premium to $19 from $14. Cheap coins have become a little more expensive.
They have only become more "expensive" for the consignors who now pay a "possible" extra $5 more than before. Bidders will adjust their bids lower by approx $5 to ensure the consignor foots that increase, not them. I know I would. If a coin is worth $50 or a $100 I'm only going to bid the appropriate amount such that my final invoice # with all fees included comes out to be no more than $50 or $100. My net cost hasn't changed one bit.
In the end, it's just Peter the consignor "trying" to rob from Paul the bidder, hoping Paul is not smart enough to adjust his bid $5 lower. For 90-95% or more of bidders, this will make zero difference. For 95% of small consignors, it's probably another $5 per coin out of their pockets. Some smaller consignors might go elsewhere if they have lots of coins valued at $25-$100. That additional 5-20% might be the break point to sell outright to a dealer.
Net effect: it's now a little more expensive to consign cheap coins to Heritage. Which in the end may mean less cheap coins available to smaller pocketed buyers.
Just another reason why eBay rules the low end coin world. They understand what you can't seem to get. Sometimes logic is overshadowed by emotion. No buyers fee makes bidders feel like they are getting a better deal and therefore creates a bidding frenzy because there are more bidders. Ultimately, eBay grew exponentially because they realized by getting a larger pool of bidders that they would achieve economies of scale. A buyers fee prevents me from even looking at heritage or greatcollections for really low priced coins. It just isn't worth it because bidders are not behaving rationally like in your example above. In other words, I can find the same low priced coin on eBay for less the majority of the time. Eventually, I just stop looking and only buy my low priced coins on eBay.
On the other hand, if I am looking for a nice mid to high end coin, I will go to the place that attracts the majority of those types of coins which is heritage or greatcollections. On higher priced coins, you normally have more sophisticated bidders (many being dealers) who understand the concept you presented above and will bid in a more logical manner by adjusting their bid to reflect the net price.
So to sum it up, I get what you are saying and it is logical but anyone who has spent a considerable amount of time at nickel and dime auctions will tell you that no buyers fee is the way to go for the unsophisticated bidder. You will attract way more bidders like moths to a flame ready to get burned
All those who adjust their bid's according to fee's etc., do you include shipping costs also?
I'm sure some do. It's been mentioned here many times in the past that eBayers were adjusting their bids for shipping cots.
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