Machinery auction charges

[startinghandle]

A contractor I know took a muck spreader to sell at a collective machinery auction and it made £6500 and he was happy until the cheque arrived and he was charged 10% commission and 5% buyers
Premium
Do vendors and purchasers pay buyers premium ?

 

[Dave W]

It usually adds up to about 10-12% between them.
ie if there's 5% buyers prem then vendors is only 6-8%.
Fairly normal for both buyer and vendor to pay

 

[Willie adie]

Certain auctioneers really milk the charges buyers premium, commission, indemnity charges and vat on top.
I asked an MEP to look into charging buyers premium on lots that the seller is charged commission on too.
Effectively charging twice for the same service.
He Thought under EU rules there was a good case to stop buyers premium and had it been found to be illegal the auctioneers wouldvr had to re imburse every premium charged.
However because the auctioneers put a sign up saying they charged it. It was deemed legal

 

[Dave W]

It's only in agriculture that it's thought strange to charge buyers prem.
pretty standard in every other industry

 

[betweenthelines]

It's only in agriculture that it's thought strange to charge buyers prem.
pretty standard in every other industry

Bollix. Who else charges the buyer 10% over the agreed price?

 

[Henrythefarmer]

The auctioneer has to make money they don’t do it for fun

 

[startinghandle]

since posting thread I have heard the auctioneers at this auction pay themselves a big bonus and fat lamb numbers are down by 50% due to selling deadweight

 

[Dave W]

Bollix. Who else charges the buyer 10% over the agreed price?

Go to a big plant auction. That would open your eyes. 10% pretty common.

Seems to be a pretty common attitude that's it's only farmers allowed to make money from agriculture. Dealers, auctioneers, grain merchants etc are all just out to rob the farmer

 

[Dave W]

Antiques and car auction will also be well above 10%

 

[76masseyman]

He could have put it at the farm gate with his phone number on and price for free, and took the best offer given.

Then waited in for no show people, or gone to meet the tyre kickers, or answered the phone to tyre kickers and low ball offerers.

But it went to a sale, was probably put on the auctioneers website, entered in the catalogue that was probably sent to many peoples addresses etc.

So, it went in the sale, made a good price, gone away and sold as seen with no comeback.
Good result I’d think.

 

[mengeleguru]

Our local auctioneers don’t charge any buyers premium at all.

 

[Sparkplug]

Big Plant Co like Euro Auctions used to be 5 % Sellers and 2.5% Buyers - which was sensible enough, but changed recently to buying is 10% on first £2 k and then 2.5% from memory on balance.

 

[Exfarmer]

In many auctions the premiums both ends come to near 50% of total selling price. Beware!

 

[Willie adie]

In many auctions the premiums both ends come to near 50% of total selling price. Beware!

Aye a bloody rip off

 

[Willie adie]

But auction companies appear to be above law. And charge what they want

 

[Dave W]

But auction companies appear to be above law. And charge what they want

How are they above the law??
They tell you beforehand what the buyers and sellers fees will be?
No ones forcing you to put your hand up

 

[betweenthelines]

It's only in agriculture that it's thought strange to charge buyers prem.
pretty standard in every other industry

Thought you were referring to industry as a whole, not just the Auction industry. Although I fail to see why a premium is charged on machinery when there is none on livestock

 

[Willie adie]

How are they above the law??
They tell you beforehand what the buyers and sellers fees will be?
No ones forcing you to put your hand up

Exactly thats why i refuse to buy or sell with them now

 

[Goweresque]

How are they above the law??
They tell you beforehand what the buyers and sellers fees will be?
No ones forcing you to put your hand up

A solicitor (for example) is forbidden to act for buyer and seller in the same transaction. The conflict of interest is obvious. So how can an auctioneer charge for his services to both sides of a transaction? Thats what commission is, its a service - it attracts VAT. So what is each getting from that service? The buyer obviously wants as high a selling price as possible, and the auctioneer likewise as his commission depends on it. Fair enough, seller and auctioneer's interests are aligned. But what about the buyer? His self interest is to procure the item for the lowest price possible. How does the auctioneer look after the buyers interests? Answer - he doesn't. And thus shouldn't be allowed to charge him for a service he doesn't get.

 

[Dave W]

Exactly thats why i refuse to buy or sell with them now

Bit you'll probably go and give your money to a dealer who was prepared to pay the buyers premium.