Registration Fee

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Posted By: Doug Allen

This post was pointed out to me so I thought I would clarify.

First of all this is nothing new. For a number of years we have had a new registration fee of $75. This fee covers a full year of catalogs, and I don't believe it is a secret...if you are an active bidder (win or lose) you automatically get renewed at no additional charge.

I really don't believe the fee is unreasonable. For inquiring minds our direct costs of servicing an account is about $100 per year.
Cost per Premium Catalog set - $22/auction - $66 per year
Cost per Premium Catalog mailing - $7/auction - $21 per year
Cost per Classic Catalog - $4/auction - $12 per year
Cost per Classic Catalog mailing - $1/auction - $3 per year

Many of you who know me realize that I love this hobby and am a collector myself, but it is also my responsibility to run a successful and profitable business. I believe when you experience our auctions from the quality of the images to advancements offered with our state of the art bidding system you see that we spare no expense.

I hope this explains the reason for the $75 registration fee. If you have any questions about this or anything else don't hesitate to contact me at the e-mail provided above.

All the best and for those of you participating in the auction good luck next week!

Doug Allen
President
Mastro Auctions

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Posted By: Jeff Lichtman

So, what does the 17.5% buyer's fee repreesnt? And the 15% consignment fee for each item sold represent? Does the $75 registration fee for each account push Mastro into the black? Or is it the 32.5% juice gained on each sale? Why try to explain that the $75 fee is just an attempt to recoup the cost of "servicing an account" when it truly is just a way to generate more revenue for Mastro?

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Posted By: Kyle

I've always wondered by there's a buyers fee and a consignment fee. I understand the consignment, but then the point of the buyers fee is vague. One can only wonder how much money the auction houses make on these auctions.

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Posted By: Tom Boblitt

they don't always (and probably RARELY) get 15% on the sell side. I'd bet it's closer to 5-8% overall. Not that they aren't pocketing a LOT of dough but I'd bet they send catalogs to 12-20,000 people. Just a guess.......

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Posted By: John Kal

Now that the internet is ubiquitous, isn't the catalogue redundant, especially at what must be a huge cost to produce? My room is getting chockablock with these tomes. Get rid of them and give us a break on the coming and going.

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Posted By: Daniel Bretta

As someone who has actually visited the Mastronet Office in Chicago and been given a grand tour I can tell you that it must be very expensive to run that business, from the art dept, photography room, shipping room, et cetera...they have an awful lot of people working for them, and I doubt any of those people work for free. Then you have to factor in the security for the building. It seems to me that $75 isn't a whole lot to pay to get on their catalog list...it's not like the catalogs are throw-away items either. Each one of them is loaded with great items with descriptions that can be used as research tools.

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Posted By: Doug Allen

Jeff,

The buyer and seller's premiums have nothing to do with this fee. The auction premiums are transaction fees that are known by the bidder when they buy and known by the seller when they consign. Obviously the buyer doesn't bid unless the bid plus 17.5% is acceptable to him/her. Conversely the seller doesn't sell unless he/she feels even after subtracting the seller's fee they are still getting more than they could get if they sought out the buyer on their own.

The $75 is a fee that ensures the registrant is serious. This fee is not meant to recoup our costs. I was simply pointing out that servicing an account is a real expense. I literaly have thousands of buyers who have been getting free catalogs for years and haven't bought anything...I love these people because they are active and serious collectors. I would never think of cutting them off just because they never win.

Regards,
Doug

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Posted By: Josh Adams

Doug,

Thanks for posting. I am the one who originally posted the question about the registration fee. I was curious as to whether this was common in the industry. Thank you for your insight.

Josh

Go Go White Sox
2005 World Series Champions!

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Posted By: leon

Thanks for clarifying, Doug. Thanks for another great auction too. I hope I can afford something at the end . best regards.....moderator dude

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Posted By: Joann

I don't get the Mastro Premier catalog - haven't yet anyway. But if the REA catalog sitting on my counter is any indication, I would say that $75 as a one time fee is beyond fair. Wow. And now that finals are over I can finally sit down with the REA catalog and leisurely go through it. Can't wait.

I also think that the $75 has a perfect secondary function of keeping away the teens and other recreational bidders. It doesn't and never will affect me, but if I have a 6 digits worth of consignments in an auction I would definitely be worried about some 16 year old showing off with his buddies as being the high bidder. (Zack - you know I'm talking about the vast population of teenagers that are not advanced and serious collectors!)

I also like the "just bid and you stay on the list". It acknowledges the uniqueness of auctions in that you can be very valuable to the house even if you never spend a penny - because ALL bids drive prices. So you help their business even if you don't give them a dime.

Joann

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Posted By: Lee Behrens

I also agree with the fee, the catalogs are beautiful and are not cheap to produce. They are not asking alot in that you bid on an auction to continue receiving the catalogs for free. There are plenty of auctions that if you bid the minimum you would never win the bid so no harm in bidding to keep getting it for free.

Lee

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Posted By: davidcyleback

You have to pay for most catalogs with Sotheby's. Perhaps you get them free if you're a regular. They have so many auctions, you basically pick and chose which one's you want. You had to pay for the Barry Halper/Sotheby's catalogs. I think it was something like $80.

I get a number of catalogs, not always sure why. As I know it costs a lot to produce and ship them, I'm likely to place a bid or two to make it worth their while. I can say that I'm more likely to not forget to bid if I have a catalog lying around.

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Posted By: andy becker

Doug,
first let me say to the board what you and your staff already know.
I fully support mastro. I bid in all of their auctions. I win items in most....many times multiple items.

however, in an auction that generates $11 million (I think that's average for mastro, correct me if I am wrong) of sales the buyer's premium ONLY is 1.925 million. assuming that you let every seller in the door for free, that is still huge revenue for delivering a service.....as you are not fabricating the items you sell.

giving out catalogs will expand your customer base, and inevitably increase your revenue.

if you were to ask for references, as most auction houses do, you would certainly avoid giving away catalogs (and associated set-up costs) to people who have no intention of participating.

I go back to my original analogy from josh's thread, this sounds like the equivalent of Exxon/Mobil having a toll booth at the entrance to every service station.

let's call a spade a spade, Doug. mastro is charging a "registration" fee because you CAN....if you were not the top dog in the sports auction business you would never do it because nobody (myself included) would pay.
and I guess at the end of the day, that is your prerogative, but I really do think it is a bad business decision.

isn't it better to expand your customer base than to alienate potential customers?

especially when you make a statement like "I literally have thousands of buyers who have been getting free catalogs for years and haven't bought anything...I love these people because they are active and serious collectors".

didn't those people have to start at some point?


all this being said, I still believe that mastro is top in their field....and far and away is my preferred auction house.

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Posted By: Chris

I have no problem paying $75 to receive quality auction catalogs. Like many of you I'm so blown away by the recent REA catalog and the fact that they're sending it out free. Incredible that they can and do, but understandable that most can't, or don't want to. $75 for some great reading and reference material is nothing really.

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Posted By: andy becker

chris,
do you think the $75 is more easily absorbed by the corporation or by the individual?

the catalog is the main vehicle for their business, we are not talking about free baseball digest.

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Posted By: David Vargha

I go back to my original analogy from josh's thread, this sounds like the equivalent of Exxon/Mobil having a toll booth at the entrance to every service station.

Weird analogy. Using your word picture, it's more like the equivalent of Exxon/Mobil having a toll booth at the entrance to every service station that you have to pay at once and only once. After that, you get in free with a wave of your Exxon/Mobil "preferred card" as long as you get gas every once in a while. (To be more accurate, it'd be more like you get in free with a wave of your Exxon/Mobil "preferred card" as long as you drive into their station every few months.)

DavidVargha@hotmail.com

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Posted By: andy becker

ok david,
i agree with you.
would you be an exxon customer under those conditions?

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Posted By: Jeff Lichtman

Doug, with all respect - and I think Mastro does a great job - to suggest that the $75 fee is simply required to ensure that the registrant is serious is somewhat specious. Doesn't providing credit card info and references suggest that the registrant is serious? What about bidding on your auctions? Does that suggest that the registrant is serious?

How can you claim that the $75 cost is not used to defray costs or generate income? Where does the money go, then, that is generated from this fee? Is there a special line on the Mastro tax returns that this money gets slotted in - not income or reimbursed expenses? As Andy said, you charge the $75 fee because you can, end of story, just like Sotheby's does and other auction houses. I'm not suggesting that you shouldn't do it (I would if I were in your place), I'm just suggesting that your subtle claim that Mastro is "all about its customers" and above generating as much cash as humanly possible is somewhat disingenuous.

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Posted By: Chris

Hey Andy,

I don't disagree with your reasoning, I'm just saying I don't have a problem with it. It's not that out of line with other like businesses. And sure you and I think that $75 is more easily absorbed by the corporation, but I bet if you asked Doug he'd disagree...

Might they lose out on potential bidders by charging a fee? I'd say it's more than likely. But they've made a business decision that it is smarter for them to go about it this way. Along your lines - it would be awful if Exxon/Mobil charged a toll at all service stations. But would that stop us from buying gas? Like you said, they're doing it because they can. This is just one more situation where we have to pay for our little obsession.

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Posted By: Richard Masson

Mastro Auctions is not an eleemosynary institution.
Believe it or not, there are expenses incurred in generating the revenue produced by each auction.
There are plenty of competing auctions to make sure Mastro treats buyers and sellers fairly.
No one who actually bids in the auctions pays the "fee". I actually never knew it existed.
What exactly is the issue here?
Non-bidding collectors do not have a right to free auction catalogs. Is that what someone is suggesting?

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Posted By: andy becker

not at all, richard. that's why i think that mastro should request referrences.

i'm just saying that for someone who is just getting started....a major auction newbie....that a bidder registration fee might not be the best business desicion.

i think it would alienate some potential customers....and that is verified in josh's original thread....at least a couple chimmed in that they wouldn't pay the $75 and therefore they won't participate.

chris,
a toll at mobil wouldn't stop me from buying gas, but it would stop me from being a mobil customer.


edited to add, i certainly understand that mastro has opperating expenses....no question.
i just think that trying to recover a very small portion of those expenses by turning off a potential new participant is penny wise and dollar foolish.

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Posted By: leon

Richard- I agree with your sentiments.....

We haven't paid the fee because we have been sending Mastro money for several years. If you were new, and registering today, you would need to pay the one time fee....bidder or not, winning bidder or not...I barely heard of the fee before this thread too...but knew there was one. If you are going to seriously bid in a Mastro Premier auction then $75 shouldn't be your biggest concern. I'm on the fence about free or not....I think "free" does invite a lot of "not so serious" folks to request catalogues. Kind of like all of the friggin' scans some folks ask for with absolutely NO intention of buying the card. That's why I put a scan up first, most of the times....regards

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Posted By: Richard Masson

Anyone who is interested in starting to purchase scarce and valuable sports cards and memorabilia at this point in time and is put off by a $75 initial registration fee is in the wrong department. There are many smaller auctions which cater to this sort of collector.

Isn't this like a first-time furniture shopper asking for a Sotheby's antique furniture catalog for free? They are welcome to it, but please reimburse me for the cost if you are not a serious buyer.

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Posted By: Chris

"a toll at mobil wouldn't stop me from buying gas, but it would stop me from being a mobil customer."

and again i can't disagree andy. i guess it's up to you, and i, and all other potential bidders to make that call. but whether we choose to participate or not, i don't think it changes the fact that they have the right to charge the fee if they so choose.

or maybe i'm just arguing they're side in the hopes that doug will waive my registration fees... : )

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Posted By: Jay Miller

I agree with anyone who can use the word "eleemosynary" in a sentence. Way to go Richard! I would have bet anyone that that was a typo. I guess I'm just an ignorant kid from the Bronx.

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Posted By: andy becker

perhaps the better appraoch would be to charge the $75, and then credit a buyer $75 on their initial purchase.

no purchase, no credit of $75. that would even encourage more participation.

for the record, i do not remember if i paid the $75 or not.....but i do have a id....so this is not about my $75.

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Posted By: Chris

refunding the fee after a purchase sounds like a great compromise. good call.

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Posted By: cmoking

refunding the $75 fee after the first purchase may be a good idea if they had instituted that from the very beginning...but there is no way in hell that a company would instate this at this point - because they will either have to refund all the fees they've ever taken (and that will be too much for the company to stomache), or they will have a bunch of pissed off customers who didn't get refudned. Either way, they lose.

I didn't like paying the $75 either. But I say this: for anyone that doesn't feel the $75 is worth it, you wouldn't have won any lots anyway. So you, and Mastro, aren't losing anything.

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Posted By: Richard Masson

My favorite word of all time. Shocking to have a chance to actually use it.

A prior employer used it in the copy of a print add. My comment to the Chairman was, "What the f*** is that?"

Needless to say, I'm not there anymore.

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Posted By: Chris

"but there is no way in hell that a company would instate this at this point"

absolutely true. i didn't say it would happen, i just thought it was a good idea...

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Posted By: Josh Adams

I am not saying that the $75.00 is too expensive. Heck, anyone willing to shell out several thousands of dollars would not make that argument.
Personally, the idea of having to pay someone in order to give them business does not sit right with me. That was all that was on my mind. And, I was just curious as to whether this practice was common in the major auction house industry.
Mastro gives away the catalogues to their auctions for free at all the Sun-Times shows, and they are definately informative and great references pieces. I have saved them for exactly for this purpose.

Thanks guys,

Josh

Go Go White Sox
2005 World Series Champions!

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Posted By: Mike Pugeda

I paid for the registration fee and have received catalogs free since 1999.
So it breaks down for me to a little over $10.00 a year to keep the catalogs going. I can't really complain about that. How much does it cost to go to the movies nowadays? Not to mention the popcorn and soft drinks. You want to talk about highway robbery.

Mastro probably recoups their fees by you making a bid or two, but this is their business and their prerogative. I probably wasn't too happy at the time about paying their reg. fee, but when I can refer back to their older catalogs for information or just something to look at while on the john (too much info.) I'm glad I paid it.

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Posted By: David Vargha

I think it was $50 when I first signed up around 2001, I believe.

DavidVargha@hotmail.com

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Posted By: Josh K.

I agree with the other Josh - the idea of paying someone to give them my business doesnt sit right with me either. Further, it seems to me that if you (a) dont want a catalog - since the auction is available online; or (b) are able to pick one up elsewhere for free, that you should be allowed to bid without having to pay the fee.

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Posted By: david

if the 75 dollars is such an issue for you, dont get the catalog and dont bid. it is not one of you consitutional rights to be able to bid in a mastro auction. thousands of collectors have paid the fee and have no problems with it.

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Posted By: Wesley

I must be the biggest rube here. If I remember correctly, Mastro charged me a $100 registration fee in 2001.

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Posted By: Mike Pugeda

Wesley,

Make that 2 rubes, I believe I paid $100 also.

Mike

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Posted By: Kyle

Does anyone know if Consignees get the fee waived for bidding? It'd make sense considering they're sending some of high value to Mastro, and Mastro is making some nice money off of it.

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Posted By: HandsAtNeck

Although not the same thing, but Memory Lane sent me a chocolate Goudey Ruth along with their catalog, just fore signing up. It was about a PSA 8 before I ate it. Now it is Authentic, Altered, I would guess.

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Posted By: Cat

I ate the Goudey Ruth Chocolate too. All gone...out of the pop report.

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Posted By: davidcycleback

My opinion is that if you pay the $75 and regularly bid you get more than $75 worth of catalogs. If you've never seen a MastroNet big sports catalog, it's like 500 pages fully illustrated. It's basically a big book, like you'd buy at the book store.

Considering the cost of printing and Mastro's desire to make sure bidders are serious, it's not a huge deal.

Perhaps Mastro should issue a membership pin and certificate (and instructions for the secret handshake. Shhh, you didn't hear me say that).

The one thing for Mastro is there are a lot of other good auction house these days, competing.

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Posted By: martin dalziel

These upfront/catalog fee's are nothing new and certainly not confined to Mastro alone - the more traditional auction houses (read - fine arts, antiques, etc.) Sotheby's, Christies, Parke-Bennett, etc. all charge for them and have been for a long time - decades. There are many collectibles auction houses that do the same thing - Hunt and Lelands for example. Once you've been around for a while and have built a solid reputation then you become the preferred/desired place to shop - you can then charge for the privilege of shopping there and people will pay for that.

The Mobil gas station analogy doesn't work for me - gas in a necessity (yes, I know you can argue that it isn't, but..). Items at auction are not - they're luxuries. If you tell people they have to pay for the privilege of buying a necessity, then yes, people would be upset. Putting the same plan in place for a luxury, is a lot more palatable for most people. How many people pay a cover charge for a bar or nightclub? What are you getting for that money? - the ability to spend money at said bar or nightclub, but that’s about it. When you buy an item from Tiffany's, what do you get for the premium you are paying - intrinsically, nothing. Yes, there are people who won't go to a bar that charges a cover merely to walk in the door and yes there are people who won't pay the premium at Tiffany's, but there are many more that gladly do so. Same here with Mastro and all the other auction houses who have gone this route.

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Posted By: Jay

Richard--It just shows where your priorities are. My favorite word of all time is callipygian.

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Posted By: Richard Masson

Didn't he used to coash at Notre Dame?

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Posted By: Anonymous

Or maybe he was just popular in the locker room...

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Posted By: warshawlaw

Mastro can do as it pleases; there are enough auctioneers out there so you really don't have to do business with them if you don't want. On the other hand, it does irritate me pay for a catalog then pay the auctioneer anywhere from 25%-37.5% for auction services, part of which should be the catalog. Perhaps the compromise is to allow bidders to opt out of catalogs (i.e., be an internet-only bidder) in return for waiving the fee?

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Posted By: Brian

Why is it wrong for businesses to make money?

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Posted By: Jeff Lichtman

It's not wrong for businesses to make more money just like it's not wrong for Levi to charge whatever the hell he wants for his cards. What is wrong, however, is for Mastro to claim that the reason they charge for catalogs is because they simply want to weed out non-serious bidders. The reason they charge is, plain and simple, to make more cash. I'm sure it annoys them to have to send out catalogs to people that don't bid on their auctions. I also waste plenty of time interviewring potential clients for cases that I may never get. I can either charge a consulting fee or not. I choose not to. Mastro decided differently. End of story.

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Posted By: Cat

I bought six cards from Mastro last year totalling $45,000. About a year ago, if my memory is correct, the vig went from 15% to 17.5% because of what they called "cost increases." Undoubtedly, part of these cost increases were for more and more catalogs that are being shipped. Most businesses have revenue goals and seek varying ways in order to attain those goals (at a minimum they have to offset their cost structure). If catalogs are being mailed to people that never buy, Mastro can either charge those people or continue to let the buyers pay for the catalogs of those that do not buy. That's an easy decision for me...let those that have the benefit (receipt of what has previously been free catalogs) pay their own way. I don't want to pay for them.

My only issue with Mastro's policy is that they only charge the new customers and seemingly give the old time lurkers (and catalog recipients) to their auctions a free pass. Hopefully, in the future, they will rethink this policy rather than raise the vig again. There is a law of diminishing return on raising that vig and in my view they have reached the ceiling or went beyond.

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Posted By: jackgoodman

Don't we pay a disproportionately high price just to walk into a card show? We know it's an income stream for the promoter that offsets costs of running the show. Same as charging for a catalog.