Buyer's Premium

[caramelcard]

"Hunts: 15%, I think, although their website is so awful that you can't learn anything from it."


chuckle.

[vargha]

It's simple economics. An auction house has to make money. We don't seem to have a problem with the companies we work for making money, but boy, those greedy SOB's at (fill in the blank) are really sticking it to us. As consignors have worked consignment fees down to nothing in many cases, just where does the auction house make a profit after creating a glossy, full-color catalogue, running an online auction and then fulfilling it?

The truth is that psychologically, sellers feel more comfortable with paying fees they never see. The buyer's fee is paid by the seller whether he realizes it or not as it is money paid for his card(s) that he never receives. Yes, sometimes buyers fail to factor in the 20%, but this is the exception rather than the rule. It's the same reason why your paycheck has tax deductions taken out each time you are paid rather than paying you your gross earnings and asking you to write a check to the government taxing authorities at the end of the year.

[barrysloate]

It wouldn't matter if the consignor received full hammer and the BP was 20%, or if the BP was waived and the consignor received 80% of hammer. The lot would still sell for the same amount, the seller would still receive the same amount, and the auction house would still get its 20% (I know there is a fraction of a point difference but that is just a technical point).

I think complaints about the BP are pointless. An auction house has expenses and needs to make a profit.

[Peter_Spaeth]

If consignors don't like it, they can vote with their feet and opt for the houses with lower fees. It's a free market economy.