A question on the auction process

[jtryka]

After being innundated with Heritage begging me to sell something, I got to thinking, and I really don't know how the process works. I know as a buyer in a Heritage auction I pay the 15% buyers fee, which of course makes me lower my bid (i.e. if I think a coin is worth $1150 to me, I bid $1000, so when they add the juice I pay what I think it's worth). Now as a seller, there is also a 15% fee (I know, it can be negotiated quite a bit, unlike the buyer), but how does that work? Let's take an easy example to explain my confusion. Suppose a coin sells for $100 hammer price. The buyer then pays $115 ($100 + 15%). Now if the seller pays the full 15%, is that based on the hammer price or realized price? i.e. does the seller get $115-15% (or $97.75), or does the seller get $100-15% (or $85)? So does the auctioneer end up with a total of 30% of the hammer price (15% from each side), or something more like 17.25% as in the second example?

[EVillageProwler]

All the %-ages are relative to the hammer price. So, in your example, the auctioneer gets 30%.

 

EVP

 

[MarkFeld]

 

jtryka,

 

Depending upon the value of the coins you consign, you will probably get anywhere between 100% and 105% of the hammer price.

 

 

 

[keithdagen]

If you're only doing a couple of coins, they're going to recommend you put them in their weekly auctions. Heritage does run specials where they waive the seller fee, and occasionally give you 105% of the sale price. Standard if no specials are being run, or the collection is small though, is 85% of the hammer.

 

So in you example of $100 sale with 15% fees, the buyer pays Heritage $115 and Heritage gives you $85.

[jom]

I think some of us should get together and go into the auction business. 30% fees? What a joke...even real estate agents only get 6%.

 

jom

[MikeKing]

What about buy back fees?

[MarkFeld]

Mike, buyback fees typically run from 3% to 7%, depending upon the value of the consignment and, in some cases, how much is bought back.

[keithdagen]

What about buy back fees?

 

You only get charged a buyback fee if the coin doesn't sell, and in that case (usually 10%), they deduct that from the rest of the proceeds.