I had an interesting back-and-forth with a client yesterday, who questioned Profiles’s high buyer’s premium. I responded by saying, it is among the lowest in the entertainment auction field at 20/23%. He corrected me by saying that Premier Props has the lowest. I wanted to tell him that Premier Props does not operate in the same market as Profiles, but I did not want to sound snotty.
Still, the notion of where Profiles’s buyer’s premium ranks stuck with me. So I decided to make a list of auction houses sorted by their current respective buyer’s premium. Many of the auction houses deal with multiple genres, so for simplicity I will only mention the better known ones that deal with entertainment memorabilia on a regular basis.
|AUCTION HOUSE||BUYER’S PREMIUM||NOTES|
|Nate Sanders||20%||No credit cards accepted|
||23% flat on LiveAuctioneers|
|Profiles in History||
||23% flat for Internet bidders|
|Premiere Props||23%||Across the board|
||For U.S. auctions only|
||Additional 3% for Internet bidders|
From the chart above, I can see that the client I dealt with yesterday was, er, misinformed. In Profiles’s case, we are still at the lower end of the spectrum with 20% B.P. if the client bids directly by phone, absentee or live in-person. Propworx offers 15% for items above $100K, but their market is not really in the +100K range. Nate Sanders is at 20%, but it’s curious that they do not accept credit card payments, which is such a mainstay for the consumer public. Highest on the list is Julien’s with the range of 20 to 28%, depending on the various bidding configurations. For the biggest and most well-known auction houses, 12% for $1M items is plenty when they routinely sell million dollar fine art.
Of course, buyer’s premium has been on the rise for the last few years. It’s just the state of things (look at gas prices, or milk). Jason DeBord has already documented this topic in detail. Click here to view his handiwork.
With a tiered buyer’s premium system, it is often difficult to report on sales results. It’s been the habit of many people to simply default to the highest rate. On the one hand, the higher prices look good in press releases. (For the record, Profiles uses the 20% B.P. rate when reporting gross sales.) Conversely, using the highest rate provides more ammunition for detractors to point out how high of a commission an auction house charges.
This is the reason why I prefer to report the hammer prices and just mention the premiums. Give the readers the facts and let them form their own opinions. (I briefly made my case in a Collectors Ransom post last year.)
UPDATE: Propworx’s correct buyer’s premium policy is as follows:
4. AFTER THE SALE
(a) Buyer’s premium
In addition to the hammer price, the buyer agrees to pay to us the buyer’s premium together with any applicable sales or compensating use tax in the place of sale, as well as . The buyer’s premium is 20% of the final bid price of each lot up to and including $100,000 and 15% of the excess of the hammer price above $100,000 if paid via cashiers check, money order or bank wire transfer. The buyer’s premium is 23% of the final bid price of each lot up to and including $100,000 and 18% of the excess of the hammer price above $100,000 if paid via credit card or Paypal.
UPDATE 2: Heritage Auctions also does not accept credit cards. Christie’s does so only under certain circumstance.