I am always asked some questions – here’s some answers for you.
As an auctioneer, I get asked questions all of the time about the perceived value of the items and the market value of the items. How we make a living and how we market projects. Some are common sense, which I answer anyway here, and some aren’t so common. Here are some of the top questions that I get and the honest answers.
I must say this – some of the answers are blunt, and the truth and I do not apologize for it. You need to understand that things aren’t like they were in the good ol’ days!
I don’t like auctions – they are the last ditch effort – and it gives my stuff away.
This perception depends. Do you have quality items or mass produced off the shelf items? Mass produced items never bring the prices that everyone thinks they should – such as a world collection of shot glasses. To the buyers – they are boring. If you have a gold leaf walking stick from the 1800’s found in a barn with a deer head with hand carved horns – then your market just went from boring to a WWE smack down event.
If you give an auctioneer time to market your items properly, the advertisement has time to saturate into the mainstream and pull more bidders and money to the auction. If you close your business on Saturday and have an auction 5 days later, then marketing does not saturate. Additionally, if you plan your shutdown process, you can advertise the auction – your buyers can see what you are selling and be able to make a conscious decision. No amount of marketing is going to get you to where you want to be in pricing.
How much do you think it is worth?
Being an auctioneer, we are asked always to give a hardened answer when there isn’t one. If you go to one auction and sell an Xbox live – you will see that it goes for $100. If you take that same Xbox live to another auction – you will get $500. So when you ask us about individual items, and you get a hardened answer – chances are you have an inexperienced auctioneer.
I was recently asked about the value of a café that was going out of business. I told her that in the current market if we sell the entire store, including the Intellectual property, then we can start talking about $50,000. But if we sell it individually, then there are no guarantees. She took that $50,000 as her entry point. It didn’t sell as it was in a bad area (no parking and you could not find it unless you visited it previous) and in a café or restaurant situation – you need a volume of people to support it due it being a low profit business. If you pay $5 for a cup of coffee, understand that about a buck of that is going to be profit to buy the next lot of product to sell. You need to have a large volume of people to come through that line to sustain your business. Before you start thinking too much about it – that $1 is after employees are paid, not before.
I looked the price up on eBay – why can’t you sell it for that?
eBay has been touted as the world’s largest garage sale – so basically inexperienced appraisers will use it for pricing comparisons, much like Estate Tag Sale Companies. The prices that people commonly give me are the astronomical price that someone who is not actively doing homework will buy. If you look at eBay, if there are 12,000 listings for the same item – chances are the market is flooded. So I in turn ask “What was the completed listings for that product, and did you do the average price of the sold listings?”
Normally they will come back with a pricing guide book. The thing to understand is that books like pricing guides are useless the minute the ink hits the pages. The markets change faster than you can think, and the ink never changes. So commonly we use them to look up product history, but as for pricing, they are un-reliable.
Why don’t you tell people where you find the pricing? Well, because you have to be licensed as an Auctioneer to get it. Some states don’t require licensing, but it’s not cheap, and finding that one thing is not going to cover the costs.
You do online auctions or live?
I do both. I prefer some online auctions – but understand that advertising for both is immense and intense. We did a 425 doll auction for as little as $125 on Facebook that netted over $15k. We did $300 of advertising for a company that netted $3500. So we will market the products with high quality pictures, but there is no guarantee that people will purchase it.
Where to you advertise?
We advertise in places that buyers are. AuctionZip – sometimes as their pricing strategy is cost prohibitive. Gotoauction, email campaigns, Facebook campaigns, Instagram, snapchat tiktok. However, as more and more of the “Free” apps are getting overburdened with ads, it is turning off clients from using those apps. And many of the ad sites are actively changing their algorithms so that an ad from a small company is drowned by ads from someone else. I actively watch these changes, and then make adjustments – or place the ad money somewhere else that will have a return.
Why don’t you advertise in the Newspaper?
Last Sunday, I picked up the newspaper, and gave it to my wife. She immediately told me to put it back. The newspaper was about 40 sheets of paper, and nearly no advertisements. No more than 6 years ago, it was as thick as War and Peace, and now outside of one strange and narrow focused local story, and the rest is National news that people get off of the daily opinion and newscasts.
Most of the articles are reporting about some other network’s reporting of another network. So readership is down – and the thing with newsprint – if it was so good then we can see advertising in the medium. But is 100 auctions that we have put forward – only 1 person has said they seen it in the newspaper. So for the $10,000 spent (two weeks’ worth of ads each auction) the guy showed up and did not purchase anything but a hot dog. Newspaper advertising is DEAD!
How do you talk so fast?
Practice. With practice you become experienced, and with experience comes the ability to talk even faster.
Why does it costs so much to hire an auctioneer?
A skillful auctioneer is not cheap – and a cheap auctioneer does not have skills.
Many people think that the cheaper you go with the auctioneer, the better. This is when they have doomed their auction from the beginning. If you are hiring a free auctioneer, I would question them with how long have they been in the business, and what they have to offer with such a low price. It is guaranteed that 100% of your low cost or no cost auctioneers will be bankrupt or gone in less than 3 years because they cannot make money at it. It is a career – not a side job. Remember that.
It is a game of marketing. No matter what, your auctioneer is more of a marketing professional than a bid caller or online listing agent. They are supposed to market your property to the right people to get the best price. That is why you hire an experienced auctioneer.
Experience isn’t cheap. Always remember – every surgeon had to have the first patient. Do you want to be the first patient or the 500th? Just because we are expert marketers does not mean that buyers are going to flock to the property.
You make a lot of noise about marketing – but what about my property?
Let me make this clear. An auctioneer is an expert marketing fiduciary, however, an auctioneer cannot force people to buy what you have at the price that you want it to bring. It is nearly impossible to sell anything to a person who does not want it, nor do they need it. While our job is to represent you, don’t expect us to be able to spend money in moving something that is 30 years old to sell – you spent more in moving it than its worth. Don’t expect us to sell something that has been used for 10 years that has a depreciation worse than your typical automobile for the price you paid for it. It doesn’t work that way.
Let’s face it, we all think our items are worth a million bucks and the things that we have accumulated over the years are beautiful and everyone will surely want to buy them…right? Wrong.
Things have really changed over the last few years. Items that people thought were valuable years ago, such as collectable figurines or china cabinets filled with plates and glassware are no longer in style. Furniture that is still functional but is 20 years old is just not in style or in demand today. We have found that 50 is the magic age. People over the age of 50 already have many of the things that people want to sell and do not want any more of it. The people you are thinking would want it – approximately the same age as yourself – all are doing the same thing – selling it.
We always tell people that it does not matter what you paid – it is only worth what someone else is willing to pay for it.
It does not matter what the Washington Post or any of the sensational newspapers say – your Beanie Babies, Precious Moments, Franklin Mint, .99 Troy Ounce Silver you bought off TV, and other various collectables are simply not worth a nickel. Your kids don’t want it, and the people who already have them are downsizing so the market is dead – dead – dead. Your 70’s furniture? DEAD.
The other thing that kills a market? The people who you sell to are resellers, and when their stores are full and they can’t move merchandise – they stop buying. This is the number one sore spot now with Storage Unit Auctions.
Something else that kills a market? A great economy. People will not buy used or second hand items when they can buy brand spanking new for about the same price. You simply cannot think that something used retains value – it does not. By the time you have had it for 3 years, you are looking at 10% of the value on a good day.
But it is great stuff – my kids don’t even want it!
Our clients are often shocked to find out that no one in their family wants their china or old dining room set, but they still believe that someone else will certainly want it. Doesn’t it tell you something when your own family or friends don’t want your stuff? Even your neighbors will tell you “No.” The market just isn’t there.
“I don’t believe you – it has more value than you say it does.” Wrong. That is sentimental value – if you have a lot of that – don’t call us, we can’t sell it. We sell everything absolute which means the highest bidder wins. If you want to put a reserve on it – you might want to talk with the inexperienced auctioneers down the road. If we do that, we charge a no-sale fee, because we know – it’s not going to sell.
Millennials and Gen Xers are resistant to the influx of furniture, kitchenware, and general stuff that comes with their parents’ downsizing. They don’t want the stuff, and neither does their friends. They are completely throw away and buy another at the same store.
Look, folks are often frustrated that they cannot even donate it. Then there is the challenge of content disposal and the transportation of it. When folks tell us their stuff is 20 or 30 years old, we have to tell them that there is little to no value to it. They often then get frustrated and don’t want to pay for the transportation costs associated with loading, driving and unloading their stuff just to get rid of it.
What about antiques? Unfortunately, the antique market has dropped off dramatically for all the same reasons. The younger generation just does not have the interest that was there some 15 to 20 years ago with antiques.
So what is hot? Its furniture and items that are more contemporary in style and age. Items that are 3 – 7 years old and in great condition still have a market. This is typically called transitional furniture. We always ask people; how much would you pay for a 20-year-old couch? If the answer is, I would not…or maybe $5…well then you really have your answer…don’t you?
It’s not all that surprising when you think about it. For one thing, younger generations might not have the space to store table service for 12. The average age of homeownership has been pushed back, and the number of millennials who own homes is at a record low.