What is a BUYERS PREMIUM?
And why do we have one now?
The buyer’s premium is now a standard fee charged by most auction houses and online auctions that buyers agree to pay in addition to the sold auction price.
We have as of Aug 3 2020 added a 10% buyers premium to the auction.
So by bidding on MidlandAuctions.ca from Aug 3rd 2020 and forward you must agree to pay the sold item price, plus the buyers premium plus the applicable taxes on each lot. We ask that you take this into consideration when placing your bids and setting your maximum bid amounts.
Traditionally in live auctions a buyers premium was implemented to cover the costs of the staffing for the sale such as the handlers and paid auctioneers that the auction house would need to hire for the sale. Higher end catalog auctions were typically 18% and higher as the costs for creating the catalog and the additional staff experts and research staff required would require a higher buyers premium to cover the expense.
These days we still have staff behind the scenes and they are photographing and cataloging everything, not to the same detail and extent and we do not research items here like the high end auctions do however we would like to get a better quality control measure in place and we are working towards that goal.
It still takes a great deal of time and effort each week to have the auction. We organizing shipping, curbside pickup, delivery service and file away each lot into a storage system to keep track of everyone’s items (I am sure you can just imagine how crazy it can get in here with 400+ lots coming in each week, 400+ lots going out each week and 400+ lots already photographed and waiting for the next week to start… that’s 1200 lots approx in here every week plus the items people did not pick up and are being stored and due to covid19 that number at time has been over 1000 stored lots) so every item must be logged into location and that location entered into the computer so we can track it all.
Most of this is now becoming “THE NORM” due to the covid19 pandemic we have had to change a lot of things here in a very short amount of time.
This will be the 6th month (March 2020 to Aug 2020) and we do not see things changing any time soon so we must make a big change in order to keep going and bring in additional help.
We held off as long as we could without a buyers premium however to stay competitive in the online auction market we have reached a point where we do need to implement a buyers premium, something we never wanted to do but now see why it is important to have one and why all the other auctions do this (and trust me if they do not yet they will eventually).
Unlike retail markets we can not simply increase the price of the goods sold to cover the rising costs and we can not increase the commission percentage any further with the consignors as we are currently at the industry standard percentage and raising the commission rate would most likely push our regular consignors to other auction houses. Almost all online auctions have a buyers premium between 10% and 20% so we are going to set ours at 10% at this time so we remain competitive. We hope this does not deter anyone from bidding and enjoying our auction we really just wanted to explain why we are doing this and hopefully everyone is understanding of this change.
Thank you all
Caro & Chris & Staff