Quote:
Originally Posted by pokerplyr80
As others have mentioned I agree it seems inherently unfair to have the auction house competing against bidders that have to pay a 20% premium. I'm sure there are many lots on Heritage I could win and flip for a profit if they'd waive that premium for me.
But I do respect the fact that they disclose and defend the practice. At least it is well known, and does help to protect consignors against the risk of having a lot sell well below market value.
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Certainly disclosure goes a long way toward addressing notions of unfairness. I do not believe disclosure, though, to be an end in and of itself, as in the real world many bidders do not read auctions rules. So in those instances when the rule varies significantly from industry norm, I question whether an AH should not do more than bury the disclosure in the fine print.
In the case we are discussing with Heritage, almost certainly they do factor in the forgone BP when deciding how high to bid. If they win the item, at say $1,000 where the underbid is $950 and the BP 20%, the price they "paid" was $1,190.00, where $190 of that is the BP on the underbid which they chose to forgo. The price to you at the $1,000 hammer would have been $1,200, so in this example you would have been at a $10 disadvantage (less than 1%).