Friday, June 08, 2007

Auctions and the buyer's premium

Also in today's blog

Memoirs of a Twentieth Century Antique Dealer
Comments

This section may be considered "off topic", but I'm hoping that some Bookworm readers share my enthusiasm for antique shops and auctions. Not that they are the happy hunting grounds they used to be back in the Eighties. In fact it's some years since I saw anything at a view which lured me to attend the sale.

Reading the online catalogue for a sale held yesterday, I was surprised and dismayed to see that my local auction house has increased the buyer's premium to 10%. According to receipts for things I bought in the mid-Eighties, no premium was charged, but by 1989 a b.p. of 5% was in place.

There's a good article on the subject of the buyer's premium by Stuart Maclaren, editor of Government Auction News, published monthly by
Wentworth Publishing Ltd, 17 Fleet Street, London.

He writes - "The buyer's premium is kept by the auction house and is not passed on to the vendor. This means that you are paying an additional fee to the auction house for the privilege of having bought from them: it's a bit like Tesco's charging you 30 pence for tin of baked beans, and then charging you an additional three pence fee for the pleasure of having shopped in their store."


After learning that "Christie's now charge an amazing 17.5%, and Sotheby's a truly astonishing 20%!" I then read, "So that's 'what it is' - but 'why it is' is a more difficult question. What do you get for the privilege of paying this money? Not catalogues, which you have to buy separately. Not a great service either, because the auction houses which charge the most are often the most chaotic. The truth is, you get nothing at all for your additional 10% (or whatever percentage it is). A buyer's premium is purely a tax on your spending, and auction houses charge it because they can, and because it makes them a lot of money."

Memoirs of a Twentieth Century Antique Dealer


A book which tempts me, even though it costs £20, is Roger Warner: Memoirs of a Twentieth Century Antique Dealer.

Who was Roger Warner. On an elegant page at the Regional Furniture Society's website, I read -

"Roger Warner was an antique dealer in the Oxfordshire town of Burford for over fifty years. During this period he traveled the United Kingdom visiting other dealers, buying stock and enjoying infinitely more encounters with furniture, both remarkable and unremarkable, than any curator or historian could hope to achieve in a lifetime. Starting business in 1936, he began by specialising in things that did not interest his fellow members of the trade. Beds, 'back stairs' furniture and obscure medieval items caught his early attention. Some objects were bought privately, but many of his prize finds came from the great country house auctions that occurred with such distressing frequency just before and after the Second World War. This was the great heyday of twentieth century collecting, an era in which almost every sale would turn up something of rarity and interest; items that are now certainly absent from the market, or their kind disappeared altogether."

Comments


Treva and Richard Havers posted interesting comments yesterday. I'll comment on Monday.

Treva, if you have time over the weekend, could you send me the list of Bridge titles you've bought to anneweale@yahoo.com?

7 Comments:

At 08 June, 2007, Blogger Bill Braine said...

Someone should tell Mr Mclaren that, in fact, Tesco's does add a few pence to the wholesale cost of their tinned beans. It's called profit, and without it, Tesco's would not exist.

The Buyer's Premium charged by an auction house is similar to the markup that any retail establishment adds to the cost of the products they sell. The difference is that an auctioneer's BP usually results in a substantially smaller markup. A private dealer, as you no doubt are aware, would charge a markup of as much as 50%, depending upon the rarity of the item and what the market will bear. The much fairer auction process allows demand to set the price, and yes, the auctioneer then adds its own percentage onto the final price in order to generate revenue.

 
At 10 June, 2007, Blogger Nell Dixon said...

The auction houses seem to do pretty well from the sellers too. A recent sale of some china made £250 but after all the deductions were made my parents recieved only £185. It seems a little odd to me that vat is charged on the sale of secondhand goods when the vat has already been paid when they were bought new. A private seller doesn't have this problem. Hence I suspect the popularity of sites like ebay.

 
At 15 June, 2007, Anonymous Ron Adcock said...

Mr McLaren has it right. The buyer who pays the premium receives nothing for it in return (except the dubious privilege) and therefore bp is simply a cash grab amounting to a tax. I'm under the impression that only the government is allowed to inflict taxes upon us. If this is correct then buyers premiums are illegal. Save your receipts for a refund for when this cash grab is successfully challenged in the courts.

 
At 11 September, 2008, Blogger thomson2008 said...

The auction going on needed more space for the buyer and seller. It in deed fulfills the demand of both the sides.Otherwise it remains unbalance.
======================
Thomson
autoauctions

 
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