“If you are an appraiser or if you are someone that wants to sell assets you need to take a serious look at MaxSold because they are a future of maximizing the selling price of personal property. MaxSold is the answer for us because it’s just the way to maximize the selling prices for items…” – Ray Nugent, Nugent Appraisals
The Logic Behind Starting at $1
Why Reserves Are Not a Good Idea
From being in the auction industry since 1956, we have learned that reserves run counter to our clients’ needs of selling everything for these reasons:
1. Sale of items is more certain when there are NO minimum bids.
When there are reserves or minimum prices items typically go unsold. Evidence of this can be seen on other selling channels:
- Search through classified sites like Craigslist, and you will see items listed for months with no sale.
- Consignment stores return the items to you when they go unsold.
- Estate sales often have high percentages of unsold lots due to pre-determined prices.
Unsold items end up in storage which simply delays the problem, and ends up costing you more. When you release your items to the competitive bidding forces through MaxSold, items are sold at fair market prices and are taken away on your timelines – supervised by MaxSold.
2. Competition for items WITHOUT minimum bids is more, as way more bidders are drawn into bidding.
When there is no starting bid, people who aren’t necessarily in the market for the item end up bidding. It’s auction fever! MaxSold has sold art work, antiques and vehicles worth $1000s of dollars with no reserves and very happy clients. See past auction listings for examples.
3. You remove ceilings on selling prices when there are NO minimum bids.
Bidders think minimum or reserve prices reflect end value, which creates a price ceiling. When there are no minimum prices, there is no preconceived limit as to how much MaxSold bidders should bid.
4. Arms length transactions REMOVEs risks of selling good items privately.
Wouldn’t you rather have 100s of others bid on the item and compete to set the price; rather than selling an item to one person you know for what they think is a “fair” price? The one person you know can compete with other bidders to set the price. This makes sure that the transactions are arms-length, transparent and finite.
A recent example: A seller was closing a store with remnant flooring and equipment including a forklift. She thinks that the total value of everything is $9,000. Everyone wants her forklift but she promises it to the auction. On the day of cataloging she gets an offer for $4700 for the fork lift and she wants to sell it. We remind her of the advantages of MaxSold: competitive bidding, allowing everyone a chance – and completion of the sale. She leaves it in. The fork-lift brings a whopping $7300. The rest of the auction brings $24,000. The guy who wanted to buy the forklift at $4700 (and who said he wouldn’t bid at the auction) bid to $5800.
Client is happy. However she brought a lot of stress on herself through the process because she was too fixed on price. The process does better than alternatives on price, but clients are happiest if they buy in on the merits of the process versus alternatives. Merits like safe, finite, transparent, cost effective, higher returns and more items sold than other methods!
5. Better items in the auction increase prices for all items.
Better items attract multiple bidders to the event, yet only one will prevail and win the item (at the highest price of course). Several other buyers, who are capable of buying the better items, come into auction with unspent money looking around and probably bidding on other things driving up the value of everything. So, typically the seller benefits in several ways by leaving it in the auction. Removing them only assures that the one dimension is satisfied at a minimum level-the price of that single item.
As an aside, know that dining tables and entertainment units aren’t big sellers.
Dining tables and other large pieces of furniture such as entertainment units are discussed on every phone call. Many new homes these days are built without dining rooms. Many condos are too small to accommodate large furniture. Sellers often can’t give them away to their kids or family – as everyone who needs a dining table already has one. MaxSold sells large pieces, but everything else too – art, china, tools, sterling, figurines, small furniture such as side tables, coffee tables, etc. – bring in much more than the large furniture pieces.
We work on commissions, so it’s in our best interest to make sure your things bring as much money as possible – if putting reserves on things would do that, we would use them, but our experience and data shows that starting at $1 and selling unreserved is the best way to generate the most value for your items (on aggregate) with as few loose ends as possible.
“A very BIG thank you from the homeowner and myself for a great auction! Wow! Unbelievable! Boy, I’m totally blown away with Maxsold’s marketing skills! Thank you for reassuring me that most activities take place the day before and 15 minutes before closing, boy were right! Never doubt the expert! With thanks for a great auction.” – Lynda