Originally Written in 2017, Edited 2020.
I write this headline with a very serious tone. I promise, I won’t mince words here. I could write an entire magazine in what I have learned as President-Elect of the Association. My phone lights up almost daily from Auctioneers, Sellers and Buyers alike.
The auction industry is being challenged from multiple different sides, and the business men and women who are on the forefront of these challenges have the knowledge you need to be successful are right under your nose. Plain and simple right? Let’s explore.
I know in the past there have been quite a few people with differentiating opinions. Hence we had two Associations, and we have folks who would have joined neither for one opinion or another. Today I am asking that those opinions be put aside – here’s why.
By not joining a strong Association – you put your business health at risk. Ever wander around in the dark and bump into that corner of the bed? Hurts doesn’t it? What do you learn? Put a night light where that corner bed is? That is how your business – I don’t care how long you have been in it 5-10-30 years – is currently working. I have seen many auctioneers hang it up because they can’t get out of the selling of quality merchandise. Those of you who knew Josie Graves know what she meant by that.
Harry Mullis said it best – “Without proper guidance – you could very well work for less than minimum wage.” I thought he was kidding – he wasn’t.
Estate tag sales are eating the auctioneer’s lunch. Personal Property sales (unless they are quality sales) do not have a Return on Investment. In many of the interactions I have had with the sellers are complaints they wind up owing the auctioneer after the sale. In the 2008 Market Summary from the National Auctioneers Association Personal Property Auctions were down 2%, and the trend continues. If we know that portion of our industry is going to the negative – why continue to pursuit it? Our purpose is to serve Bankruptcy Trustees, not be liquidated by the trustee.
Estate Tag Sales are selling items at a higher rate than we see personal property auctions nationwide. Folks are happy to have Estate Tag Sale companies come in, sell some property and leave the remainder for the seller to deal with – they are HAPPY with that. Auctioneers sell everything to the bare walls and sparkling clean – but folks are NOT happy with that. There is Psychology behind that – such as you would not purchase a desk from Wal-Mart at $35 – but you would the same desk at Target for $80.
Those auction houses you used to see in every town? You are lucky to see one on the outskirts of a major metropolitan area. Where it took a few days to build up a good collection of merchandise, now takes a month or longer. In between, auctioneers are selling returns from Wal-Mart or Food overruns to make the electric bills.
There is nothing wrong with that – but take into consideration how much work it takes to make that work – there’s more to it than face value. I recently did a business plan where I took the costs of doing business such as labor, insurance, place rental, truck rental among just the few items and several other factors including sourcing product – and it was mind numbing. If you are a new licensee, startup or a person looking to increase your business – you might want to think about doing that exercise. Free to a small commission is not going to sustain you!
Diversify product. Diversify Auctions with Tag Sales & Appraisals. Diversify yourself! Make that which is hurting your business work with your business
What I am saying is that Auctioneers need to be able to pivot and go in other directions just as much as businesses do. The NBA player has to pivot and turn and try to enter into the defense area with a different strategy – YOU NEED TO AS WELL! The days of a full service anything and attempting to make everyone happy is gone. You will spend more money and waste more time trying to make everyone happy than you will get in return. Standardize your process and disclose it!
It’s great you have an auctioneer’s license – but in the business world, if you are unwilling to see past your license – you are working yourself into irrelevance. I have seen many full time auctioneers now working in corporate America because the auction industry has changed and they did not. Which leads me into the next threat auctioneers are facing.
There is pressure coming from nearly every aspect of society to get rid of licensing laws and regulations for occupational areas. Some may cheer that – but really – how are you as a professional auctioneer going to stack up against a teenager doing the same thing and he’s willing to build his business on the cheap? How are you going to fare against a state where now, you have to have a municipal auction license for each municipality versus a state license – and the fella or gal in the county don’t? They will take the cheap teeny bopper over the experienced auctioneer every day – because they no longer see value in experience – and about teens – if you haven’t noticed have a hive mentality – they WILL help their friends for nothing in return outside of two hour online gaming session.
Just think about that a minute.
I know in your mind something is saying “That will never happen here.” The people at IBM were saying the same thing “They will never sell the Personal Computer Company” – and they did. It’s called Lenovo. If you were there when it was announced – I can tell you it was a scene from the Walking Dead. The industry that has been around for 400 years before Christ is being threatened by 16 year olds selling on eBay, and holding Tag Sales. They have the money – and they can buy the legislation.
As late as April of 2018, John Hood had an opinion piece in the News and Observer that went on to discuss the reasons why Occupational Licensing is a losing proposition for nearly everyone, including the end consumer. It was a very compelling argument that built it’s base on several different states and their actions for deregulation. What it did not cover was the fallout of the impact to the general public.
I want to give you some perspective. In 2011, the North Carolina House of Representatives proposed a bill (House Bill 587) entitled “An act to promote North Carolina job growth through regulatory reform.” It was nicknamed the North Carolina “Jobs Bill,” and its purpose was to “remove bad regulations, stop new bad regulations from being enacted, prevent regulatory burdens from impacting growth and hiring, and to remove barriers to market entry for entrepreneurs, including the reassessment, reduction, or removal of State licensure programs.” Among its other features, the bill would create a special 12-member Legislative Study Commission on Occupational Licensing, with members appointed by the governor, the state legislature, and the public. The commission’s duties would be to:
- “identify outdated and unnecessary occupational licensing laws that should be repealed
- identify existing occupations that are regulated that do not require licensing
- study alternatives to occupational licensing laws that would work effectively
- study to what extent occupational licensing laws create barriers for individuals, including low-income individuals, from entering into new occupations.”
The bill referred to no specific occupations. Although portions of the bill were later incorporated into a Senate bill that was passed (Regulatory Reform Act of 2011), the terms related to occupational de-licensing were dropped.
Snapshot Michigan: The Michigan Office of Regulatory Reinvention (ORR) released a report to the public in April 2012 recommending the complete deregulation of 18 occupations (about half of them licensed), among them acupuncturist, auctioneer, interior designer, dietician, nutritionist, and speech pathologist.
Snapshot Florida: In 2011, the Florida House approved a bill that would deregulate 14 licensed occupations, including auctioneers, athlete agents, hair braiders, interior designers, and professional fundraising consultants and solicitors.
It does happen, and that is why we need you as an ambassador to the auction industry. Why does the Association need you? Because your voice, while quite unique is stronger when there are many voices with a common message. I am not talking about 300 or 400 – I am talking about 1,000 – 2,000. Everyone – every licensee.
Over Christmas one of the things I love to listen to is Mannheim Steamroller. It drives the neighbor’s nuts – there is one song called Silent Nicht. The Orchestra starts with one instrument, and slowly builds adding another instrument until the ensemble is all up to speed then it fades quietly. But during the pinnacle of the song, your heart pounds to the masterpiece – and then the choir sings in the background adding to the intensity. Earth shaking.
Earth shaking is what we need to be in facing these challenges. Not quiet nor divided. We cannot change our direction individually, we need to be united in voice on business threats, continuing education, and in our service to the public. All of us need to have the heart of a teacher and teach other auctioneers and the general public what to expect in the coming years and how it impacts them. While the licensing board will do their best to defend their position of protecting the public. It’s our focus is to defend our profession through educating the public and ourselves in emerging trends.
We are nearing a bump in the proverbial road, and it will require one voice. We are all against occupational licensing or we are all for it. Only we can decide our own fate.