Buyers Premium Auctions

Eric in IL

Well-known Member
How many are in your area ?

In central/southern Illinois I don't see too many. Most of the time it is a land auction, where prospective buyers will likely attend regardless.

So far I have only attended one. It was an equipment sale and if you paid cash the premium was waived.

I guess if they become the "norm" and you are the seller, you may net a bigger crowd by advertising a "no premium sale".
 
Around here 90% or more of auctions have a 10% buyers premium. I just add 20% mentally to whatever I am bidding since I will have to pay 10% BP plus 8% sales tax on the 110% of bid.
Zach
 
Seems like a 'double dipping' auctioneer.IMHO,that is a good way to discourage buyers.How many would 'pay' an equipment dealer,or car dealer,heck even Walmart to 'shop' there.Not me...
 
Presumably they charge the seller less if there is a buyer's premium. I think it's just a way to confuse the buyer into what they are really paying. No sales tax in Oklahoma on auctions, at least farm auctions. that would be bad enough for me.
 
All of the on-line auctions here have them as I remember. Live auctions are getting few and far between. Some of those have premiums too. In Michigan there is only sales tax if they combine more than one seller into an auction for some reason. Most auctions don't charge me sales tax on obvious farm related items.
 
There's one here that charges 10%. He gets very few farm auctions. I don't go to any of his. Most online auctions are 5 or 10%.
 
I have a few choice words about buyer's premiums.
First, know that the auctioneer charges some fixed fees and some percentage fees. For fixed fees, there is generally a fixed fee for conducting the auction. There are fixed fees for reserves. There are also fees for certain types of display, order of selling, etc. There is also a "no bid" fee for unsold items.
Percentage fees can range from as low as 10% to as much as 35% around here. Most are dependent on the type of sale and the anticipated value. High value items might get a lower percentage than "dollar box lots."

Tacking on a buyer's premium to me is an outright rip-off. I hate them, and if I am at a sale that charges them, I adjust my bid accordingly. So, if I am willing to pay $100 for an item, I figure without the premium and tax what my final bid would be, and that is where I stop. Unlike a lot of bidders/buyers, I do not get "auction fever." I know what an item is worth to me, deduct any other charges from that price, and base my bids on that. Rarely do I go over my calculated price.

Personally, I think that auction regulations need to be tightened up and better enforced. I have encountered auctioneers that have you bidding against the wall, using shills, and otherwise ripping off the bidders. Buyer's premiums should be outlawed in my opinion.
 
I am a auctioneer that charges a buyers premium. I conduct a consignment auction and charge no commission to sellers on items over $500.00. The same people that are complaining about buyers premium are the first ones to want to sell there items for no commission. People pay to join costco , sams club ,etc. I don't see that as any different. With buyers premium you are still deciding what you pay. If you get caught up in bidding and paying to much with a buyers premium, you will do the same at any auction. Auction co. Have a lot more expense these days. There is a lot of technology with computer clerking, check in and out process have become more efficient , however it is a large investment to make things quicker and more efficient for our bidders. At my last auction we had golf carts to bring people right to auction from parking area , rest rooms, food stand , people to help load and haul items to your vehicle,etc. prices were strong.
 
Unless it is something I really want you won't see me a buyer's premium auction.
 
Wow, that sounds like an extravagant auction.

With all of the comforts offered to the bidders, I suppose an electronic sign displaying the "real" bid was mounted on top of the truck for all to see.
 
Very few if any local auctioneers add buyers premium. One does advertise 3% surcharge if you pay with credit card. He's about only one that takes cards.
 
Most have an opinion on this issue. Mine is that it's not a buyers "premium", it's a buyers punishment.
 
There's a few auctioneers here in ohio that don't have a buyers penalty. Most advertise that fact. It doesn't go over well on farm auctions.
 
I also hate buyers premium auctions. I am OK if it is a lot of small items, the auctioneer has to make a living. On larger auctions I pay a lot less if there is a premium. Problem is many don't care or don't understand and pay full price.
 
here a new auctioneer came in and didnt charge a buyers penalty and cleaned the others clocks---his idea he will sell a man out once he needs buyers every sale ------do like we did and quit going it wont take long
 

I attend any auction that I can that advertises buyers premium. I keep hoping that turn out will be low because of it, so that I can make some scores. hasn't worked yet.
 


I won't [knowingly] go to any sale that has a buyers penalty. This Fall, I went to a sale that was a friend of mine. When I signed up, I noticed it said buyer's premium. Right there I knew I wasn't even going to bid on anything, and didn't.
 
Well in this area you would no go to many auctions. Pretty much the norm here on auctions for byers premium. Just as fair to the other guy bidding against you , he has to pay it also. Just keep the 10% or what ever it is in mind when bidding.
 

The buyers premium does not bother me I know what I am willing to pay. I have got some good deals and wasted a day and did not get many deals... One thing is a fact buyers don't show up with empty pockets they come loaded to the hilt with cash to spend..
If a man hauls a trailer to a auction he's not doing it for his pleasure.

I have got addicted to online auctions I can set at my desk and play along... I prefer it to being there I have control on my bid.

I luv a good auction buyers premium are not... Sometimes I am satisfied to come in second for the day
:wink:
 
Buyers premium is getting more common around here. Most household/estate auctions, real estate and online auctions have them. Still not too common at farm dispersals and equipment consignment sales but that is starting to change. Some will charge it for totals under a certain amount like $1000 or less and many auctioneers now want to add on a 3% to 5% fee if you use a credit card.
 
I hate buyer/seller premiums. I have been to 2 sales with them, just because who/what was selling. The land was a cousin's kids selling land next to me that were too greedy. I bid but did not buy. I was biddung against Jimmy John. The other sale was equipment/household sale, had history books and plats that I was going to buy. The guy's SIL was the crooked, greedy auctioneer. The seller, his wife, and 1 daughter with MS were in a nursing home. Guns, shop tools, many hit & miss engines, tractors, land, and house(did not sell) was a circus. He would sell a bit of one thing and switch to another for a short while, trying to keep the crowd. He did sell all the ground at one time.

When I see buyers premium, I do not go.
 
If you are paying taxes for what you are buying at retail stores, then how is a buyer's premium auction much different?
SDE
 

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