The Auction Process
The Auction Method
According to some estimates, over 25 million Americans attend public auctions each year. Auctions are widely accepted as one of the very best processes of selling property - both real and personal - for the highest possible price, in the shortest amount of time, with the most convenience for both sellers and buyers.
The auction method has a long history of success. English language references, circa 1595 (Oxford Dictionary) and other indications of auctions being used to liquidate property of all kinds date to as early as 500 B.C.
Today, auctions bring willing buyers and sellers together in an environment (market) where buyers can compete to buy at “their” price. Sellers benefit by being assured that they receive the highest price anyone is willing to pay for each item sold at that particular time. Therefore, the selling prices result in establishing market value - in its purest form - on that day.
Steps in The Auction Process
The State of Ohio requires a written contract between the Seller and the Auctioneer for every auction - even charity or benefit auctions.
Each contract specifies the property being sold, and the particulars of the auction, such as:
Real estate contracts have additional provisions including agency, property condition and other disclosures.
Speaking of fees: ALL fees are individually negotiated with each Seller based on the special situation of that Seller and the property involved. There is no “going rate” for the area, etc.
Contact us for additional information about the specifics of our contracts and fees which are customized for each Seller.
A complete list and description of the property being sold is pivotal to the contract, promotional activities and final settlement of the proceeds. We conduct the inventory (at the time of the contract in most situations) with the Seller, or the Seller’s representative.
3) Promotional Activities (Advertising)
Some Notes about “Marketing". You’ll notice that we avoid using this term.
Marketing includes many elements that do not impact auctioneers in most auctions. While several accepted definitions of marketing exist, it is still hard to improve upon the “4 Ps” of marketing - Product, Price, Promotion, and Place (location/distribution). In most cases, the product and place are already determined. The price is what we are after. Therefore, the only true component of marketing that we address is PROMOTION.
PROMOTION includes advertising, distributing information, encouraging buyer awareness, stimulating interest and creating enthusiasm for the property (product). We take extra care and spend a significant amount of time analyzing the best package of advertising and other promotional activities based on the budget provided for these expenditures.
Basic promotional costs for a small personal property auction, such as a typical estate, are approximately $1,000 - $1,500 which includes local print media, signs, flyers and a listing with a photo gallery on our website and auction directory websites.
Adequate promotion for residential real estate requires exposure prior to the open houses and the auction. Costs are normally $1,200 - $1,500 for local print media, signs, flyers, listing in MLS and a listing with a photo gallery on our website and auction directory websites.
Larger auctions and/or specialty auctions may demand significantly more exposure. Insertions in the Columbus Dispatch, or other major newspapers and specialty trade or product publications/websites, direct mailing distribution of color flyers as well as large auction signs at the entrance to the auction site and/or at major directional locations are designed for each specific situation. Email Blasts to over 1,000,000 “warm” addresses are available. Total costs are often several thousand dollars; so, we very carefully design a coordinated comprehensive campaign to optimize the expenditure by maximizing exposure, response, attendance and bidding.
We publish all of our auctions on the Ohio and National Auctioneer Association websites, AuctionZip.com and send Email notices to our electronic mailing list. We list our auctions on sites such as Farm & Dairy, Antique Week, LandsofAmerica.com, oldride.com, etc. when appropriate.
We conduct Internet only & on site live/simultaneous Internet auctions when a Seller's particular situation calls for that type of promotion. Additional costs & logistical considerations must be fully analyzed prior to choosing either of those methods.
4) Auction Day
It is critical for buyers to easily find the site of the auction and to see, hear and understand all the details of the procedures as well as where we are in the auction process (what items we are selling, the amount of the current bid, next steps, etc.).
Set-up and Display:
We coordinate directly with Sellers to set the “sale arena” in a manner that is conducive to buyers’ needs. The Seller can accomplish this with assistance from our crew leader, or our crew will do it all - packing (if required), moving (emptying the house, etc.) and arranging the display for proper visibility and order of sale.
While our staff administers the buyer registration and information distribution, the auctioneers greet the buyers, respond to their questions, encourage and enhance interest in the property and generally establish a positive selling atmosphere.
Clerks & Cashiers (Computerized):
We use an automated system to speed the process and preserve accuracy. Buyers register for individual bidder numbers (requires a picture ID). Then, we list each item as it sells and its sold price in reference to the bidder number (#) of the high bidder. Cashiers get the sold information for each item immediately; therefore, buyers do not have to wait very long to pay & check out.
Other Administrative/Logistical Needs:
When necessary, we coordinate the availability of additional support staff (including security), tents, tables, chairs, toilet facilities, etc. or entire buildings. Parking control is another task that Sellers’ can perform or our staff is available to guide attendees to appropriate locations.
We suggest having refreshments at all auctions. When we anticipate the auction lasting over an hour, the availability of food helps keep the buyers comfortable and - therefore - stay on site. We have several qualified vendors with appropriate licenses and clean equipment; or, the Seller can select a group (church, 4H, etc.) if preferred - as long as they are properly licensed by the health department.
We start precisely at the published time with announcements including welcome, staff introductions, terms and conditions, order of sale, etc. Once we begin calling for bids, we focus on the audience and work diligently to ensure that we have the highest bid available on each item before pronouncing “sold.” When the auction is completed, we thank the buyers and the rest of the audience and turn our attention to expeditiously completing the settlement activities with the buyers.
5) Settlement with Sellers
Since we accept cash and checks as payment, final settlement with Sellers takes place 5 - 10 business days after the auction. At that time, we provide the Seller a full accounting of the auction, including:
Typical Terms and Conditions
We publish these on the back of our bidder number cards and post them at the cashier area. Some of the key items are:
For an expanded set of typical personal property terms and conditions , please contact us for a printed or emailed copy.
For an expanded set of typical Real Estate terms and conditions , please contact us for a printed or emailed copy.
Realtor Cooperation/Buyer Registration
We encourage participation with Ohio licensed real estate brokers & brokers from other states, when appropriate. Listing referrals are available for brokers with Sellers who can benefit from selling their property at auction. Brokers/salespeople can also participate through “Buyer Registration.” Specific procedures apply for each auction.
Generally, to register a qualified buyer, the broker/salesperson must 1) properly register their buyer at least 72 hours (some properties require earlier notice) with a completed buyer agency disclosure form and 2) comply with any other provisions for a given property. Such provisions are posted with each auction and are available by Email, regular mail or Fax by contacting us.
Notes to Bidders/Buyers
Obviously, we cannot have a successful auction without you - Buyers. And, while we formally represent the Seller, it’s important to us for you to be treated fairly and to have a great auction experience.
Here are some considerations to make your auction productive and a great experience.