We run an auction house located in central-Ohio. There are over 2,000,000 people residing within 50 miles of our facility and we have bidders sometimes come from over 300 miles away. We’ve run weekly auctions at this same location for over 13 years.
Our average crowd numbers right around 250. We’ve had over 700 in attendance when our inventory was widely varied and interesting, and we’ve had only 100 bidders when we’ve had a narrow inventory such as just coins, just matchbox cars or just guns.
Everything we put up for auction sells without reserve (absolute.) That means there are no minimums, no reserves, and the seller is prohibited from bidding. I’m convinced we get consistently larger crowds due to this — in fact, I know as much.
On average, we run 2 or 3 auctioneer rings, and we’re fortunate to have Peter Gehres and Laura Mantle currently helping us along with several other talented auctioneers and support staff. We start at 5:30 p.m. every Wednesday and usually sell the last item of personal property by 9:00 p.m.
We advertise our auctions on our website, and AuctionZip.com. We supplement this advertising with further promotion including newspaper, fliers, mailers, emails, social media posts, etc. when prudent.
We have done a few simulcast auctions with live and online bidding over the years, but for the most part conduct live auctions with absentee and phone bidding options for bidders unable to attend personally.
Which brings me to today.
This morning, two 24′ box trucks pull in. Bill, the owner, tells me he has a wide variety of items he wishes to consign. He had heard about our auction from his nephew who had consigned to us before. He said he has a few questions for me; of course he does.
In fact, I’ve answered the questions I’m about to be asked 100’s of times before. I’m about to answer them again today. Here’s how it’s going to go …
- Bill: “So, you guys do okay on furniture?”
Bill: “You guys get good prices on guns?”
Bill: “Good prices on pottery?”
Bill: “I’ve got some older comic books; you guys get good prices on those?”
Bill: “You guys sell tools?”
Bill: “You guys get people looking for depression glass?”
Bill: “How ’bout lawnmowers, trimmers, garden tools — good prices?”
Bill: “You do okay on coins?”
Bill will then ask if there’s anything for which we don’t get good prices. I will respond that we sell almost anything … and anything that has some demand, utility, scarcity and transferability (DUST) will sell. In other words, it has very little to do with us (so long as the auction is property marketed) and much more to do with the actual item of personal property.
Let’s look at demand, utility, scarcity and transferability in a bit more detail:
- For anything to have value, there must be demand. Generally, as demand increases so goes value. Demand, however has to be coupled with the ability to purchase (sufficient funding) thus creating effective demand.
- Utility is the ability or capability of an item of personal property to perform a function or meet a need. If a certain utility is required, and the item of property can provide that utility, then there is value.
- Scarcity refers to the shortage of an item. Generally, as scarcity increases (lack of supply) so goes value. Scarcity doesn’t work alone, however. For example, an item can be a “one of a kind” but have no value if there is no demand, or in ample supply and have lots of demand.
- Transferability is the property’s ability to be transferred from one owner to another. For example, a handgun has less transferability, and thus less value, to a convicted felon due to the inability to legally transfer.
What Bill doesn’t know is that any auction house in the United States that markets their auctions properly and allows for bidders to participate remotely can obtain market value on virtually anything — because personal property that is properly exposed is then evaluated by the market based on demand, utility, scarcity and transferability — and not on where the auction house is located or what night the auction is held.
Of course, it’s not solely the property as we’ve eluded. Properly marketed is much more than advertising. Does the auctioneer conduct an honest and ethical auction? Are items properly identified, displayed, secured? Are the staff friendly? Is the food good? Is there ample parking? Is check-in and check-out quick and easy? Does the auction move along at a reasonable pace?
Simply put, combine an auction which is properly marketed with items which are in demand, and have utility and/or are scarce, and are transferable, and people will respond, and market prices will be obtained. Oh, I forgot one:
- Bill: “You guys do well with jewelry?”
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. He serves as Adjunct Faculty at Columbus State Community College, Executive Director of The Ohio Auction School and Faculty at the Certified Auctioneers Institute held at Indiana University.