I was wondering how many auctioneers in your areas, charge a buyers premium? I saw an ad on auctionzip that was for one item and they had a 15% buyers premium on it. I personally think it is a crock. I quit going to a local auctioneers sales because of this. What's your two cents?
- Thread starter Mowdigger
- Start date
So far I have avoided those type of auctions as well, that concept does not suit me at all.
I believe an auctioneer represents the seller, and should collect from the seller, not the buyer.
Some say what's the big deal just bid 10 or 15 percent less and its all the same, and that is fine, but just not for me I don't think its the right way of things.
I believe short sighted sellers don't want anything taken out of their sell price, and have created this as much as anything.
Last year I wanted to get rid of a bad grain truck, I did not take it to the first consignment auction as it was a buyers fee deal, I took it to a later one where their fees were deducted from my check. So I put my foot where my mouth is.....
Paul
I believe an auctioneer represents the seller, and should collect from the seller, not the buyer.
Some say what's the big deal just bid 10 or 15 percent less and its all the same, and that is fine, but just not for me I don't think its the right way of things.
I believe short sighted sellers don't want anything taken out of their sell price, and have created this as much as anything.
Last year I wanted to get rid of a bad grain truck, I did not take it to the first consignment auction as it was a buyers fee deal, I took it to a later one where their fees were deducted from my check. So I put my foot where my mouth is.....
Paul
Dan T in MO
Member
I do not like a buyers premium. What I bid is what I want to pay. At an auction, I don't normally have time or paper to do the math and figure out where I should stop so I can afford to pay the salesman.
IMHO, the auctioneer is working for the seller, so the seller should pay. I have no problem with that. And, yes, I have been on both sides-buyer and seller. I understand the auctioneer needs to eat. But in the end, the seller is the one who hired him, so the seller should be the one to pay the bill.
IMHO, the auctioneer is working for the seller, so the seller should pay. I have no problem with that. And, yes, I have been on both sides-buyer and seller. I understand the auctioneer needs to eat. But in the end, the seller is the one who hired him, so the seller should be the one to pay the bill.
IHRedRules
Member
I flat out refuse to go to an auction with a buyers premium. Why should I have to pay for the opportunity to be the winning bidder of someone"s used junk.
Kansas4010
Well-known Member
A couple auctioneers tried that around here but quit when people stopped coming to their sales. I went to one auction where there was a buyers penalty and they tried charging people just to get a bidders number. I never heard from that outfit around here after that. I figure it's just a matter of time before they all do it though. I've kinda stopped going to auctions anyway but that'll stop me from going for sure.
Formerly PaMike
Member
Some of the "high end" business/industrial liquidation guys do that. It basically makes less work for them cause half as many people show up.
Alex Lyon, the heavy equipment auctioneer will allow you do place absentee bids, but requires you to wire them 10,000 for them to hold before you can bid....no thanks...
Alex Lyon, the heavy equipment auctioneer will allow you do place absentee bids, but requires you to wire them 10,000 for them to hold before you can bid....no thanks...
I have been to three auctions in the last week and none of them charge a buyers premium. I have noticed in my area of west centeral indiana that the auctioneers with a bigger and better name do not charge a buyers premium they get the sales with there name and quality service. You will not see me at a sale that requires a premium. Just my thoughts, there will always be people out there that will want to charge a buyers premium if it will lower there commission rate.
Last auction I went to, I found after I drove 80 miles, they were charging buyer AND seller premiums. When I showed them the flyer and it did not say anything about the rip off, they said all auctions are going that way now. I headed right out to the truck and left. As I was leaving, several others were following too. I heard later that the sale was stopped at about half way due to no one bidding up much.
Zachary Hoyt
Well-known Member
Almost all of the auctioneers around here in NY charge it, as long as it is stated up front I don't mind it. 10% BP is the norm and is not difficult mental math, though with sales tax it is really closer to 20%.
Zach
Zach
Brendon Warren
Well-known Member
You mean lying Alex? My dad sold in 1985, we had trouble then. I can"t believe he"s still in business
Pete in MD
Well-known Member
- Location
- Central Maryland
I rarely go to auctions that have a buyers premium.
Went to one 2 weeks ago in Pocomoke City that had a 6% buyers premium which was waived if you paid by cash or check. Never seen that before.
Went to one 2 weeks ago in Pocomoke City that had a 6% buyers premium which was waived if you paid by cash or check. Never seen that before.
Around here, west-central Wis, several auctioneers and auction companys charge a buyers premium of 13% less 3% if you pay cash. I try to stay away from auctions with buyers premiums. 1 auctioneer told me "everybodys doing it--get use to it" He can get use to seeing me less. One MN. auctioneer told me he wouldn't have got an auction if he didn't charge the 10% to the seller and 10% buyers fee. Like I really care. I wish more people would complain to the auctioneers about this. We have an auction company in our area charging [on a consignment, Farm Machinery, sale] a 15 dollar consignment fee, for all items consigned, plus 15% of the selling price, I belive up to 500 dollars. then percentage drops. It is showing in the last auctions--hardly enough machinery to have a sale.I would like to see the greedy auctioneer, the one, charging a buyers premium, go out of busines.
Auctioneers say they use the BP as a marketing tool to make their auctions more attractive to sellers by shifting a portion of the seller's commission to the buyer. But the truth is auctioneers make more money when they use the BP. Here's an example.....Action company XYZ used to charge the sellers 20% commission. When they switched to a BP auction they lower the seller's commission to 12% and add a 10% buyers premium giving them 22% total commission VS the 20% they used to charge.
About 15-20 years ago all the local auctioneers got together and agreed to start charging a buyers premium. A couple of auctioneers went even farther and started charging for bid cards under the premise it was to cover renting the building for the auction. Two auctioneers went so far as to charge admission. As far as I know they only did that once. None of the added buyers fees stuck.
BP are common at collector type auctions. The BP has been creeping upward at those sales. At first it was 10%. Then it got bumped to 12%, 13%, 15% and now one well known auction firm is charging 18%! That's in addition to the 15% they're charging the sellers.
About 15-20 years ago all the local auctioneers got together and agreed to start charging a buyers premium. A couple of auctioneers went even farther and started charging for bid cards under the premise it was to cover renting the building for the auction. Two auctioneers went so far as to charge admission. As far as I know they only did that once. None of the added buyers fees stuck.
BP are common at collector type auctions. The BP has been creeping upward at those sales. At first it was 10%. Then it got bumped to 12%, 13%, 15% and now one well known auction firm is charging 18%! That's in addition to the 15% they're charging the sellers.
Dean Olson
Well-known Member
I quit going due to the buyers premium and the fact the it sure seemed like shill buyers where involved. Some popular items sell at or above new retail prices.
None of the local auctioneers are charging a buyers premium around here. (North-East)
It is a gimmick used by auctioneers to get one up on the sellers and buyers. Most people may only have one sale in their life time. They usually are older too. So some slick auctioneer comes in and tells them he will only charge them half the going rate an let the buyers pay the rest. Many people fall for it hook line and sinker. I have had sellers rave about how much they "saved" by having an auctioneer that "charged" the buyer not the seller. The the auctioneers know some people get confused and "over bid" because they are not used to figuring out the premium while they bid.
I refuse to bid at a sale/auction with a buyers premium.
Over in IL there was an auctioneer that I bought a lot of 4 row equipment from. I could still get pretty good money around here for it. This was 15-20 years ago. At some of his sales I would be the only bid on some four row stuff. He started the buyer premium deal. I quit going to his sales. I also sent his advertising back to him when he sent it to me. He called me after a few sales and asked why I was doing that an where I had been as he had some 4 row stuff he could hardly get a bid on. Told him why. He started the song and dance about how it did not effect anything an all. I asked him if that was true why was he calling me??? It sure seemed to effect him some how. He switched back after a few years. I started going to his sales again.
It is a gimmick used by auctioneers to get one up on the sellers and buyers. Most people may only have one sale in their life time. They usually are older too. So some slick auctioneer comes in and tells them he will only charge them half the going rate an let the buyers pay the rest. Many people fall for it hook line and sinker. I have had sellers rave about how much they "saved" by having an auctioneer that "charged" the buyer not the seller. The the auctioneers know some people get confused and "over bid" because they are not used to figuring out the premium while they bid.
I refuse to bid at a sale/auction with a buyers premium.
Over in IL there was an auctioneer that I bought a lot of 4 row equipment from. I could still get pretty good money around here for it. This was 15-20 years ago. At some of his sales I would be the only bid on some four row stuff. He started the buyer premium deal. I quit going to his sales. I also sent his advertising back to him when he sent it to me. He called me after a few sales and asked why I was doing that an where I had been as he had some 4 row stuff he could hardly get a bid on. Told him why. He started the song and dance about how it did not effect anything an all. I asked him if that was true why was he calling me??? It sure seemed to effect him some how. He switched back after a few years. I started going to his sales again.
Several of my buddies and I were talking about the buyers penalty. Among our group of friends in the discussion was an auctioneer that specializes in collectibles auctions. He said the only reason his firm charged the BP was because his competitors had gone to it so his firm needed to follow suit. I looked him square in the eye and said I thought his company would want to be a leader in the industry, not a follower. He got real quiet. I didn't press the issue any farther because he's a good guy and a friend. Sometime after that his boss was complaining that the concession company at the location of one of his traveling auctions had charged him $3 for a bottle of water. He said, I swear it was only supposed to be $2. I said it is, the other dollar was your buyers premium. He looked stunned for a second then busted out laughing.
Traditional Farmer
Well-known Member
- Location
- Virginia
I don't care if they charge a BP or not just have to keep in mind how much it is while bidding.Don't see the big deal.
Massey farmer
Member
Every auctioneer around here does it. For a while I boycotted the ones who had them, then the last auctioneer gave in so now if you want to go to a auction you have to deal with it. The scam now is online bidding because you don't know who or if you are bidding against anyone. Maybe that's why I deal with dealers more now and skip most auctions.
When my brother retired, he didn't have an auction for his machinery. He advertised in the farmer's forum and it didn't take long to sell out his line of machinery.
He sold quite a few pieces as soon as word got around the neighborhood that he was retiring; they paid for it and moved it to their farm. Couldn't get much handier than that.
The 7720 combine sold right away but he still had the 8820, until a neighbor burned up his 8820 in the bean field and wanted another 8820.
He sold quite a few pieces as soon as word got around the neighborhood that he was retiring; they paid for it and moved it to their farm. Couldn't get much handier than that.
The 7720 combine sold right away but he still had the 8820, until a neighbor burned up his 8820 in the bean field and wanted another 8820.
jimg.allentown
Well-known Member
IMHO, a buyer's premium is an outright rip-off. Not even thinly disguised! I never did like them.
BUT....we, as buyers/bidders, have the power to stop the practice. The power of the wallet/checkbook. You vote with your dollars.
The idea of adjusting your bid to account for a BP does not work well. Too many times there are "uninformed" bidders that do NOT take the BP into account. The result is usually that an item gets bid up too high for that system to work. Then there are the bidders that get "auction fever" and get caught up in the bidding process, and usually end up paying too much.
I have been to several auctions that had BPs, and the final bids do not seem to change much from non-BP auctions.
BUT....we, as buyers/bidders, have the power to stop the practice. The power of the wallet/checkbook. You vote with your dollars.
The idea of adjusting your bid to account for a BP does not work well. Too many times there are "uninformed" bidders that do NOT take the BP into account. The result is usually that an item gets bid up too high for that system to work. Then there are the bidders that get "auction fever" and get caught up in the bidding process, and usually end up paying too much.
I have been to several auctions that had BPs, and the final bids do not seem to change much from non-BP auctions.
I don't know about the small guys where you are at but some of the area ones do not always charge a BP but do make exceptions to that rule if there is not much dollar value to the items collectively. I readily agree with those that say there is seldom a bargain at sales anymore as people come in "uneducated" about what they are going to buy. They just know how much they are willing to drain the check book that day unless they get caught up in beating the other guy out on an item.
buyers cost is plus 10% at most I go to.
plus 8% sales tax.
Don't matter to me, I don't care a bit where money goes
AFTER it leaves my hand.
I look stuff over, I'll pay X amount for this item total,
bid accordingly, get it or leave it and walk to the next item.
I don't get auction fever, but if you do, write down your figures
on a pad on the items you want beforehand.
$1 bid more than your figure? They own it.
I like auctions. Lots of stuff in one place, and I don't have to deal with roadside owners that think they have Golden junk....
plus 8% sales tax.
Don't matter to me, I don't care a bit where money goes
AFTER it leaves my hand.
I look stuff over, I'll pay X amount for this item total,
bid accordingly, get it or leave it and walk to the next item.
I don't get auction fever, but if you do, write down your figures
on a pad on the items you want beforehand.
$1 bid more than your figure? They own it.
I like auctions. Lots of stuff in one place, and I don't have to deal with roadside owners that think they have Golden junk....
Rat in Can
Member
I know why that happened they are charged a fee from amex or mastercard for the use so if you pay cash they get there full amount and don't need the BP to get all there money
There is no point in boycotting. All you're doing is denying yourself a good time, if you enjoy auctions.
There are enough people who are clueless and/or don't care that you're not "punishing" the auctioneer one bit by not attending.
Simply keep the buyer's premium in mind if/when you bid. Don't pay more than you think it's worth.
Buyer's premiums are a fact of life. They've been charging them on the fancy-pants auctions forever.
The reason farm auctioneers are charging them now is because there are fewer auctions to be had. They have to maintain their standard of living.
There are enough people who are clueless and/or don't care that you're not "punishing" the auctioneer one bit by not attending.
Simply keep the buyer's premium in mind if/when you bid. Don't pay more than you think it's worth.
Buyer's premiums are a fact of life. They've been charging them on the fancy-pants auctions forever.
The reason farm auctioneers are charging them now is because there are fewer auctions to be had. They have to maintain their standard of living.
Pete in MD
Well-known Member
- Location
- Central Maryland
Yeah, I know that Rat. I've just never seen it announced that way before. In the past the only announcement about a premium was if you paid by credit card. Same thing but different.
MarkB_MI
Well-known Member
- Location
- Motown USA
Let's be clear: It is the SELLER who decides whether or not to charge a buyer's premium.
Last year we sold some farmland at auction. The auctioneer asked whether or not to charge a buyer's premium. He said a 2 percent buyer's premium does not seem to affect the sale price, while anything more than that probably would. We opted to go with the 2 percent premium, reducing the commission we paid to 4 percent, rather than leave money on the table.
Note that the buyer's premium bumps up the auctioneer's commission, since it's calculated on the sale price PLUS buyer's premium.
Last year we sold some farmland at auction. The auctioneer asked whether or not to charge a buyer's premium. He said a 2 percent buyer's premium does not seem to affect the sale price, while anything more than that probably would. We opted to go with the 2 percent premium, reducing the commission we paid to 4 percent, rather than leave money on the table.
Note that the buyer's premium bumps up the auctioneer's commission, since it's calculated on the sale price PLUS buyer's premium.
MarkB_MI
Well-known Member
- Location
- Motown USA
>That's not necessarily so. Some auctioneers offer the seller a choice. Many do not, especially those that conduct antiques and collectibles auctions.
Ah, but doesn't the seller choose the auctioneer? No auction goes forward without the seller and auctioneer agreeing to the terms of the sale.
Ah, but doesn't the seller choose the auctioneer? No auction goes forward without the seller and auctioneer agreeing to the terms of the sale.
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