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I’m sitting having lunch with an auctioneer who began his career in 1959.

As we’re waiting for our entrees to arrive to our table, I asked him a question:

    “Have you ever had two bids of the same amount come in at the same time? If so, what did you do?”

My dining partner didn’t wait even a moment to answer:

    “Sure … it happens all the time. I take the one I see first, and then ask the other bidder to bid more.”

That was the answer I expected, and I suspect that’s also the answer most auctioneers would provide.

The mechanics of bidding at an auction involve:

  • Bidder makes a bid (offers an amount to the auctioneer)
  • Auctioneer recognizes the bid (auctioneer sees it, or hears it)
  • Auctioneer accepts the bid (auctioneer communicates acceptance)

In a live auction, these mechanics are played out with a live audience, with the offering, recognizing and accepting being communicated for all to see.

However, with the advent of online bidding during (or prior to) a live auction, the mechanics change — similar to a ring person in a live auction, taking bids from bidders and then communicating them to the auctioneer:

  • Bidder communicates his bid to the computer
  • The computer displays the bid to the auction-computer-operator
  • The auction-computer-operator communicates the bid to the auctioneer
  • Auctioneer recognizes the bid (auctioneer sees it, or hears it)
  • Auctioneer accepts the bid (auctioneer communicates acceptance)

As can be seen, this type of bidding where the bids are placed with a proxy who then is charged with communicating those bids to the auctioneer … it takes longer to get the bid from the bidder to the auctioneer.

What does this mean? It means the live bidder has a slight edge over a proxy-bidder. In other words, in a live auction, the bids get to the auctioneer quicker from the live bidders than they do from the online or other proxy bidders.

Recently, a bidder (David) who placed a bid via an online bidding platform shared a report he received following the auction:

      Live Bidder
      June 13, 2011, 3:25:13 PM EDT
      $1,200
      Winner
      DavidH
      Internet
      June 13, 2011, 3:25:11 PM EDT
      $1,200
      Submitted, not accepted.

David’s question was essentially, “I bid $1,200 before the live bidder bid that same amount, but I didn’t win the item — how can that be?” His report shows his bid of $1,200 was placed (submitted) 2 seconds before the live bidder’s $1,200 bid, but the live bidder’s bid was accepted rather than his.

From David’s point of view, his bid was received 2 seconds prior to the live bidder, while what apparently happened is his bid was not received by the auctioneer and/or accepted by the auctioneer prior to the live bidder’s bid of this same amount.

Even if David bid $1,200 weeks ago, often times the online bids during a live auction are not communicated to the auctioneer until the auction opens for live bids. Then, if the auctioneer recognizes and accepts a live bidder for $1,200 before David’s online bid is communicated, he’s out.

Regarding David’s issue, the auctioneer would be unable to get out of the $1,200 contract with the live bidder unless David bid more than $1,200. We wrote about Does bid calling form contracts? some time ago.

I have noted that some auctioneers have a policy that floor bids take precedence over online bids of the same amount. Apparently, some auctioneers want to reward the folks who show up and/or want to avoid storage and shipping if possible.

Can the high bidder not win? It’s actually the highest accepted bid.

Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, Keller Williams Auctions and Goodwill Columbus Car Auction. His Facebook page is: www.facebook.com/mbauctioneer. He is adjunct faculty at Columbus State Community College and is Executive Director of The Ohio Auction School.