Selling at the auction houses can be both enjoyable and profitable and it could be pretty exciting too.
Make sure to enjoy and make profit at the same time. Here, we’ll discuss tips on how to make money by selling at auction houses.
This is the main player of this selling arena, your item. Know the right value of your item or whichever it is you are planning to put up for bidding such as antiques, jewelry, real estate property etc.
Dig in as much information as you could regarding your item so you would have an idea if this will be something to look forward to in an auction or not. Most of the auction houses appraise all the items being bid for auction so this should be a smooth process as auction houses only let professionals do the appraisal.
There are auction houses however that do not do appraisal, like online auctions, make sure to know your items’ worth, it’s real value and not what you think the value is.
In giving self appraisal to your items, the tendency is that you’ll be giving your item inaccurate value which may cause you to lose some of your possible profit. In choosing what item to put up for auction, always remember its chance of getting sold.
Think of it like if it was you who’s the buyer, would you be interested in purchasing it? If your answer is not, then you might want to consider keeping it instead rather than putting it up for auction, chances are you will just be wasting your time and effort in doing so.
Review the auction trend, know what sells and what doesn’t. Know what sells fast and know what sells fairly. This will allow you to consider screening your items you want to sell in an auction.
Know the tricky part, which one will not only sell fast but will also sell at a much higher price. Consider sitting in an actual auction and observe which items are very buyable to the public and think why is it very attractive to the bidders.
Take note of how much it had been sold for and try to compute it from the minimum reserve and see how much profit they have made in that transaction. You will then be able to have a rough estimate of how much you can earn based on your defined minimum reserve amount.
Remember the Law of Supply and Demand
In selling any item, the probability of it getting sold fast is if the market of that certain item you are selling is not yet saturated.
The law of supply and demand states that if the supply is low, the demand is high. In other words if the supply is low, the price is higher. How can this be relevant to selling in auction?
Choose items that are hard to find, low on supply, cannot be easily bought and not everywhere in the market. You will be looking at pieces that are rare to find, authentic items, items from the past or the antique items, paintings, sculpture that are truly one of a kind and not been mass produced.
By doing so, you’ll get a chance to have your item get sold in a flash and at a higher price.
In choosing the auction house, the first thing to consider is the auction fee. Compare the fees you will incur to make sure it would be profitable for you once your item has been sold.
Know if they have an upfront fee or if it will be deducted to the actual sale right after the bidding is done.
Some of the auction houses also have an administration fee, learn all of those numbers and compute if it will be worth a profit or not.
In case it is not worth the profit anymore, go on and find another auction house that might work better for you. Look for the auction houses that have lower administration fee, handling fee, sales commission percentage etc.
Better to take note of every fee in order to prevent unknowingly incurring the fees.
Know the Frequent Bidders
In every auction house there are these regular bidders that most of the time always win. They are the wealthy ones, the ones who always have the budget to fight for the bid.
Knowing them doesn’t need to be personal, just study how they bid, what they bid for frequently and how much they will usually go for in every bid.
Be familiar with the items they like and the items they do not like. By studying them, you’ll have the chance to redefine which item is best to put up for an auction and which item will most likely flop.
Level The Minimum Reserve
Provided that you study the market, you study the frequent buyers, and you have picked the right item to sell, it is important that you now know how to determine your minimum reserve price.
It is where the bidding price will start, from there your chance of having this sale a profitable one will progress.
As a seller, you have the right to give your item the minimum amount reserved, do not give your item way too low amount or way too high, both may discourage the bidding public.
Putting a low minimum reserve price will give the bidding public an impression that the item is worthless but giving it way too high minimum reserve amount will implicate them that you overrated your item.
Make sure you’ll stay reasonable so you won’t scare the bidders away. Stay on the safe side but always give room for the profit margin.
It is undeniable that selling in an auction is one of the fastest ways to sell a product but it can be a hit or miss. You could sell an item in a profitable amount but at the same time, you could sell it for less.
Study the tips we have provided above and you’ll surely have confidence to sell profitably.