REA increasing their BP and making other changes

parkplace33 · #1 06-16-2025, 10:36 AM

Quote:

Originally Posted by Aquarian Sports Cards

One last time. They are not raising their BP to make more money in the direct sense. As numerous people point out the BP shouldn't have any impact on the money generated by a lot, just shift things around.

They are raising the BP to better secure consignments. If it makes a few extra bucks because people aren't smart enough to incorporate the information into their bids, that's a only a side bonus.

Definitely true.

Another piece that I find interesting is the behind the scenes negation between the seller and AH about getting a piece of that BP. For example, if you were getting 50 percent of the 20 percent before, do you now ask for 50 percent of the 23 percent?

jsfriedm · #2 06-16-2025, 10:43 AM

Quote:

Originally Posted by parkplace33

Definitely true.

Another piece that I find interesting is the behind the scenes negation between the seller and AH about getting a piece of that BP. For example, if you were getting 50 percent of the 20 percent before, do you now ask for 50 percent of the 23 percent?

Absolutely. Or more.

Johnny630 · #3 06-16-2025, 10:49 AM

Quote:

Originally Posted by parkplace33

Definitely true.

Another piece that I find interesting is the behind the scenes negation between the seller and AH about getting a piece of that BP. For example, if you were getting 50 percent of the 20 percent before, do you now ask for 50 percent of the 23 percent?

Or lager percentage in cash advance....idk I bet all kind of negations happen if the consigner has the material a auction house really wants to showcase. Who knows people always want it both ways...sometimes it's the diamond sometimes the stone...idk

parkplace33 · #4 06-16-2025, 03:06 PM

Quote:

Originally Posted by Johnny630

Or lager percentage in cash advance....idk I bet all kind of negations happen if the consigner has the material a auction house really wants to showcase. Who knows people always want it both ways...sometimes it's the diamond sometimes the stone...idk

Oh I am sure it quite the discussion between consignor and AH

A prominent guy on a FB group posted that he will not buy from REA anymore with this news. I am sure he won't.... until a huge card appears at the next REA auction. Then all bets are off

Johnny630 · #5 06-16-2025, 03:30 PM

Quote:

Originally Posted by parkplace33

Oh I am sure it quite the discussion between consignor and AH

A prominent guy on a FB group posted that he will not buy from REA anymore with this news. I am sure he won't.... until a huge card appears at the next REA auction. Then all bets are off

The complaining will end soon enough and they will be back to buying from REA. The real winner is REA they will still get tons of bidders and consigners.

Exhibitman · #6 06-16-2025, 03:50 PM

Scott, besides the fact that the antecedents for having a BP are totally irrelevant to today's business, I do not buy any explanation for the commission-BP structure other than it makes the auctioneer more money. If I 'win' a card at REA now, I pay REA the hammer price plus 23%. 123% of the hammer price is the true price of the card. On a $1,000 bid the auction house receives $1,230 from the winning bidder. How the proceeds are chopped up does not change that math. When a middleman (and auctioneers are middlemen between buyer and seller) has two choices of how to do things, a simple one and a more complex one, there is no reason to use the complicated one, other than in the belief that it makes more money for the middleman to do it that way. I've had many negotiations with auctioneers big and small, and they all use the bifurcated structure because they all 'sell' a low or zero commission knowing that the buyer's premium is still going to them.

I am not begrudging an auctioneer the right to make a living, I am expressing a preference for simply admitting that the commission and buyer's premium are one and the same, and dropping the pretense.

Andy Sandler · #7 06-16-2025, 05:11 PM

Everything is negotiable! I have done auctions for years going back to my Teletrade days when I had numerous employees, and currently with
www.AllSportsAuctions.com
where I am the only employee and have NO overhead!
When you run the company, you can do anything you want!
In my auctions consignors get the best of both worlds---I get very retail prices and I limit the consignor fees to something that makes sense for all parties.
Call me and see what I can do!
Thanks, Andy Sandler (914) 388-2940

BRoberts · #8 06-16-2025, 05:16 PM

Lol.

OhioLawyerF5 · #9 06-17-2025, 07:14 AM

Quote:

Originally Posted by Exhibitman

Scott, besides the fact that the antecedents for having a BP are totally irrelevant to today's business, I do not buy any explanation for the commission-BP structure other than it makes the auctioneer more money. If I 'win' a card at REA now, I pay REA the hammer price plus 23%. 123% of the hammer price is the true price of the card. On a $1,000 bid the auction house receives $1,230 from the winning bidder. How the proceeds are chopped up does not change that math. When a middleman (and auctioneers are middlemen between buyer and seller) has two choices of how to do things, a simple one and a more complex one, there is no reason to use the complicated one, other than in the belief that it makes more money for the middleman to do it that way. I've had many negotiations with auctioneers big and small, and they all use the bifurcated structure because they all 'sell' a low or zero commission knowing that the buyer's premium is still going to them.

I am not begrudging an auctioneer the right to make a living, I am expressing a preference for simply admitting that the commission and buyer's premium are one and the same, and dropping the pretense.

It was readily admitted that the purpose is to make the auction house more money and bring in more consignments. That's the goal of a for-profit business after all. Of course the auction house wants the more complex situation. They can spread the costs/fees out in various ways to keep various cutomers happy. They have to please buyers so they spend more. And they have to please consigners so they keep getting good items that draw buyers to their auctions. That's common sense and it isn't disputed by the auction house as the reasons for buyer's premiums. So I'm not sure who you are arguing with. I haven't seen anyone disagree with that. In fact, the one auctioneer posting said as much.

While you are correct that "how the proceeds are chopped up doesn't change the math" of a buyer's total cost being the hammer price, plus the BP. Your argument seems to ignore the fact that without the BP, the hammer price would be 123% of what it is when there is a 23% BP. In your scenario, the buyer wants to spend $1230 on the card. It makes no difference if there is zero BP and he bids $1230, or there is a 23% BP and he bids $1000. It's incorrect to suggest the bids would be the same with or without the BP. The buyer who doesn't factor the BP into his bids is a small minority.

Touch'EmAll · #10 06-17-2025, 10:48 AM

For the sake of conversation, let's assume extremes to help understand what happens in normal ranges.

If the buyers premium was zero, I believe the buyer would spend the same bottom line. And the consignor would get more because the hammer would be higher.

If the buyers premium were 50%, I believe the buyer would still spend the same bottom line. And the consignor would get less because the hammer would be lower.

So, as the buyers premium increases, there is probably going to be no affect on what the buyer spends. However, the consignor would get less as BP increases.

In a roundabout way, the BP is actually a consignors fee.

oldjudge · #11 06-16-2025, 10:56 AM

Quote:

Originally Posted by parkplace33

Definitely true.

Another piece that I find interesting is the behind the scenes negation between the seller and AH about getting a piece of that BP. For example, if you were getting 50 percent of the 20 percent before, do you now ask for 50 percent of the 23 percent?

If you were getting 10% before to be equivalent you should be getting 13% now. I wonder if REA is passing this along to consignors. My guess is no. This is why consignors should negotiate not what amounted of the BP they get back but rather what amount of the BP that the auction house keeps.

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