Hiring An Auction Company

Estimating your assets value:

Typically, one of the first questions a business owner will ask me is, “how much will the assets bring at an auction”. After taking the time to review the assets, the auctioneer should give the client a conservative estimate of the sale based upon his experience and the current market trends. It is important that the company give realistic expectations so the seller can make informed decisions based on their best interest.

Compensation and Expenses:

Is the company you are considering working for you or against you? The agreement you decide may determine this.

A business owner should carefully consider how the auction company is compensated. The most common commission structures include: straight commission, outright purchase of assets, guaranteed base with a split above to both auctioneer and seller, guaranteed base with anything above going to auctioneer or a flat fee structure.

In a straight commission structure, the company is paid an agreed upon percentage of the total sale.

In an outright purchase agreement, the auctioneer simply becomes your end buyer. The company purchases your assets and relocates them. While this can be an option in some unique situations, keep in mind that they will want to purchase your assets at a very reduced price to make a profit at a later date.

In a minimum base guarantee, the auction company guarantees the seller that the auction will generate a minimum amount of sales. Anything above that amount either goes to the auction company or split with the seller. While a seller might feel more comfortable doing an auction knowing that he is guaranteed a minimum amount for his sale, keep in mind that it is the best interest of the auction company to secure a minimum base price as low as possible in order reduce their financial liability to the seller and secure higher compensation for the sale.

In a flat fee structure, the auctioneer agrees to show up for the sale and call the auction. There is no incentive for the auctioneer to get the best prices for your assets. The auction company is compensated regardless of the outcome of your sale.

What is the best option for business owners? In my experience, an agreed upon straight commission structure. This puts the responsibility on the auction company to offer the best outcome for everyone involved. There is an incentive for the auction company to work hard for both parties, set up and run a professional sale, get the highest bid and sell every item on the inventory. Successful auctions translate to a higher bottom line for both the seller and the auction company.

Auction Expenses:

In most auction agreements the expenses to conduct an auction are passed to the seller. If the auction company pays for the expenses, it is simply absorbed in higher commission rates.

All expenses should be agreed upon in advance in a written contract. Typical expenses will include the costs of advertising, labor, legal fees, travel, equipment rentals, security, postage and printing. A reputable auction company will be able to estimate all expenses based upon their experience in previous auctions. An agreement should be actual costs charged as expenses, not an estimated amount.

Advertising is typically the highest cost in conducting an auction. The auction company needs to set up an advertising campaign that will promote the sale to its best advantage and not overspend to simply advertise the auction company.

Once the auction is complete, the auction company should provide a complete breakdown of all expenses to the seller, including copies of receipts within the auction summary report.

Buyer’s Premium:

What is a buyer’s premium? If you attend auctions regularly, you are very familiar with this term. The auction company charges a fee to the buyer when they buy an item at auction.

The buyer’s premium has been around since the 1980′s and is standard auction practice. It was first used by auction houses to help offset costs of running brick and mortar permanent auction facilities. Since then, it has spread to all aspects of the auction industry. It is prominent in online auctions and allows auction companies to cover added expenses incurred from online sales.

It is the responsibility of the auction company to provide clear disclosure of the buyer’s premium to both the buyers and the sellers. Those not familiar with auctions are often taken back by the buyer’s premium. They looked upon it as an under handed way for the auction company to make more money. Reputable auction companies will provide full disclosure within the auction contract, advertisement and bidder registration.

Typically, an auction company will charge online buyers a higher buyer’s premium percentage than those attending an auction in person. Extra fees are incurred with online bidding and are charged accordingly to online buyers. This provides the seller a level playing field for both online buyers and those attending the auction in person. Without the buyer’s premium, there is no way to do this.

Pre-Sales:

We’ve all been there. We’re looking forward to attending an auction only to find that some items were sold prior to the auction date.

As an auctioneer with over thirty-six years of experience, I can honestly state that pre-sales will hurt an auction. When a company decides to liquidate their assets, it is easy to sell off high-end pieces of equipment through online sources, equipment vendors or to other businesses. The seller receives instant cash and avoids paying a commission to an auction company.

Auctioneer’s find themselves appearing to acting in a self-serving capacity when potential clients say they are planning to sell off parts of their inventory prior to an auction. It’s hard not to consider the auctioneer’s commission when they warn you not to pre-sell anything. Yes, the auctioneer wants to earn a commission on those sales but it is more important that the auctioneer protect the sale from potential negative backlash that comes from pre-selling. The buying public knows when an auction has been “cherry picked” prior to the sale and it reflects in their bidding. It becomes a sale of “leftovers” and that impacts prices.

A buyer who purchases prior to the auction usually does not attend the sale. They already bought equipment at a good price with no competition. If they do attend the auction, they tend to let others know of their great pre-sale purchases which again, impacts prices and the overall excitement of the sale.

It is important to understand that auctions work best with a complete inventory. You want competition on your higher end equipment. The easy to sell items make it possible to gain respectable prices for hard to sell items.

When a business owner decides to liquidate their equipment assets, there is only one opportunity to do it right. Hiring a reputable auction company will assist you with a professional, orderly and timely liquidation.

Home Based Business – Flipping Domains Remains Profitable

If you are in search of a home based business, and do not like any of the conventional options, take a look at buying and selling domain names. The object with this sort of business mimics the stock market in that your goal is to buy low and sell high. Of course, there are the nay sayers who are of the opinion that the time at which domain flipping was a profitable activity has come and gone. They can keep thinking in such a manner as that means less competition for you.One thing that you have to realize is that thanks to the recession, there will be a wave of valuable domain names coming up for expiration in the near future. This is because when people were laid off, a large faction of these individuals paid top dollar for expensive domain names in hopes of making money overnight. Unfortunately for them, it is not possible to make money overnight on the internet. As a result, many of these inexperienced entrepreneurs have given up on their dreams, and allow their domains to expire. This is when a seasoned veteran of domain retrieval swoops in and gains a valuable domain for next to nothing.Furthermore, the recession has hit individuals who had been actively engaged with a home based business, but were unable to sustain the associated costs. The fact of the matter is that online business is similar to any other business in that it needs time to grow. When the recession became a reality, many home based business owners were no longer able to afford the start up expenses which are associated with a business in its early stages. As a result, they had to abandon their business, along with any associated domain name. While these events are unfortunate, they benefit you as a domain flipper.Of course, there are those who believe that there simply is not any room for the internet to grow, and as a result, domain flipping is an opportunity of the past. I completely disagree with such assertions for one major reason. There are several markets which are lagging way behind we in the Western World when it comes to internet usage. The fact of the matter is that continents such as Asia are prime for a dot (com) boom to proportions which we have yet to witness. This is the new market within which millions will be made.As you probably have gathered, I am a card carrying member of the group who realizes and recognizes that profiting from expired domain names has yet to reach its full potential. My recommendation to anyone still looking for a home based business, is to not summarily dismiss domain name flipping. While there is a lot of work involved, the potential payoff is amazing. Additionally, you must realize that there is a lot of work involved in any home based business regardless.

How to Choose the Best Home Base Business Ideas and Earn Money Fast

Are you thinking of putting up a business but don’t know where? Have you consider home base business but don’t have any idea on what to create and how to start? Home base businesses are effective compared to the traditional brick & mortar operations due to positive things they can offer. If you are in search for home base business ideas that are effective, you need to undertake planning and research.Businesses that can be established at home can be easily searched online. There might be hundreds or even thousands of them, but how do you know they are effective? What most individuals do to achieve success online is they try affiliate programs (aka affiliate marketing). Simply chose a program you are interested in promoting. Signing up is free, once you have acquire ideas on the program to promote and everything is in order for you to start marketing to earn money. The more you promote or market a product, the more you earn money.Aside from affiliating programs, check on other online business opportunities. There are many business opportunities online; the question is what fits you best. Take time to learn your options so that you land on the business opportunity best for you.You can get started right away on the business opportunity that best fits you for a very small amount of money. You can start marketing products, and before you know it you are already earning money that keeps on coming into your business.However, making money online is not as easy as all those sales pitches make them sound. In every business opportunity given, make sure you give it your best shot (meaning take action and be consistent). Make sure that growth is at stake and not the opposite. A lot of business opportunities are shattered due to negligence.Service type businesses are also a good idea for home base business. People are looking for different services which you can take advantage. Most services online are for web designer, graphic designer, writers, data entry jobs, completing surveys and many other service skills. Consider what interest you and do your due diligence.Most people don’t have the time to do the tasks. They resort on paying someone to do it for them. Given a service skill, you can begin to market it online and earn extra income. This is a great idea for you or for a business to get started.There are many home base business ideas accessible but only few are effective and reliable. Be careful and investigate each opportunity. You can investigate the company with the Better Business Bureau or search the internet for feedback and comments.Settle for business ideas that are effective, by doing so you can go and start it up right away. Establish your home base business as soon as possible so that you can start earning money right away.


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