A Beginner’s Guide to Buying at Auction

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Live auctions can be a great way to scoop up bargains or add hard-to-find items to your home or business. To the novice, however, auctions can appear confusing or intimidating at first. Here are some good tips to get you started successfully at your local auction house.

  1. Caveat emptor (or “Let the buyer beware”). Most items sold at auction are sold “as is” in estate condition, which means they have previously been owned and/or used and don’t come with a guarantee. Items may also be described incorrectly and damage or defects may not necessarily be included in online descriptions or photos. Whenever possible, inspect the items in person for signs of wear, damage, or repair. If you can’t make it to the auction house, call or e-mail in advance of the sale to inquire about the condition of the item(s).
  1. Ask questions. Auction houses should be happy to educate new buyers on the auction process and the items being sold, and if they aren’t welcoming, take your business elsewhere! Bidders typically have to register in advance, which may include providing a copy of a driver’s license and/or form of payment to keep on file. You should also be aware of any buyer’s premium (a fee charged by the auction house to the buyer) and taxes after the sale, which may add another 15% to 25% to the final bid price.
  1. Make a list. Seasoned bidders will often make a list of items they wish to bid on with their maximum bid amount next to an item description or lot number. This keeps them focused and within their budget.
  1. Carry a measuring tape. If you’re planning on purchasing a larger item such as a piece of furniture or a rug, be sure to take the measurements of both the space that you intend to place it, as well the doorframes in your home and the cargo area of your vehicle. You’d be amazed at how many people buy things that don’t fit in their car or home!
  1. Bring some packing materials. Auction houses may have some extra boxes and recycled packing material available for buyers, but they’re usually limited and may be gone by the time you get a chance to pack. Bring some newspapers and boxes to pack smaller items and have some old blankets handy if you plan to buy furniture or other large items. If you purchase a chandelier, a wardrobe box from Lowes or Home Depot can be a good way to transport it home safely.
  1. Pack a snack. Auctions may have anywhere from several hundred to a thousand or more lots to sell at a time, so you may be waiting a while between lots that you want to bid on. Consider packing a snack and some caffeine if you’re going to be there for several hours or more.
  1. For resale, buy wholesale. Auctions can be a great way to purchase inventory at wholesale prices. Items sold as lots or in large sets can often be sold individually for a profit, providing you buy at a good price. Do your homework beforehand to determine a reasonable cost per item before bidding. The “sold” prices on eBay are usually a good indication of the resale value of more common items.
  1. Leave an absentee bid. Don’t have hours to spare sitting in a chair? Consider leaving an absentee bid, in which the auction house will bid on items for you up to a maximum amount that you set. Be sure to ask how the absentee bids are executed.

4 Easy Ways to Boost eBay Sales

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mini figs

When you’re experiencing sluggish eBay sales, here are four simple, yet effective ways to boost your sell through rate.

1. Browse the competition. A search of the recently sold items on eBay will provide an idea of what types of items your competition has been selling lately. Sellers of interest can be bookmarked by adding them to your favorite seller’s list for quick reference in the future. What types of items are they having the most success with and how often are they selling these items? What do their listings look like? What are their sales terms? You’d be amazed how much you can learn just by looking carefully at other seller’s listings.

2. Review your pricing strategy. If you’ve had an item listed for 3 months now with no offer, it’s probably time to make a change. Take a few minutes to re-assess the market and review similar items that have sold recently. Consider reducing your price to entice buyers, or using the “Make An Offer” feature if you want to get a better idea of what buyers are willing to pay. Items in high demand may even do better if listed at auction, especially if you have a group of similar items to sell at the same time. If you do auction them, be sure to stagger the start times and offer a combined shipping discount for multiple purchases.

3. Take better pictures. eBay is probably the most widespread marketplace online, connecting millions of buyers and sellers throughout the world. Not everyone may understand English, but they will understand great pictures. Look for ways to make your pictures stand out, especially the lead shot that’s used for the preview. Eliminate distracting backgrounds by using a pure white or a gradient background. Crop the lead photo closely to the item, so that the details are clearer to people that are casually browsing. Offer more pictures in the listing, which provides greater reassurance to buyers about the condition of the item.

4. Expand your offerings. Sometimes, a slowdown in sales can be attributed to seasonal shopping trends. Other times, it may be a matter of running out of popular inventory. In either case, expanding your inventory can help provide a more consistent baseline of sales, which will help ease the feast-to-famine mentality.

Not sure what to offer? Try looking for inventory that you have a personal interest in. You’ll be better positioned to purchase and re-sell inventory if you enjoy what you work with.

How to sell valuable items on eBay – Chapter 2

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Chapter 2 – How to Authenticate Your Item

If you have something that may be of great potential value, you’ll need to be sure to properly authenticate your item prior to attempting to sell it. This step is crucial to ensuring a smooth sale and maximizing the sale value of your item(s).

First, does the item have any provenance? Provenance is the history of ownership, which may include prior sale / auction receipts, photographs, or written documentation. Items with historically significant provenance or that have been owned by famous individuals can have their value increase greatly as a result.

If your item doesn’t have well documented provenance, then perhaps it’s possible to authenticate the item on your own using well-documented references (much like you did in your 8th grade term paper). Identical / similar items shown online and in print publications can be used to authenticate your items. I once did this with a rare piece of presidential china that I received from a client. After purchasing the reference book, I learned that the provenance the client had provided was incorrect and that the plate that she had provided me was actually older. It ended-up selling for $3189, which thrilled the client, the collector, and myself!

3189

If don’t have provenance or access to a good reference source, then professional authentication and/or appraisal may be necessary. This can be done for items such as jewelry, art, autographs, sports memorabilia, comics, coins, and even toys. Use your favorite online search engine to research different forms of authentication / appraisal for your item(s). If you’re still unsure as how you should proceed, look at which third-party companies major auction houses / dealers associate with as well as how they make available the authentication certificate prior to the sale.

3 Smart Shipping Strategies

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Since I started selling on eBay full time several years ago, I’ve shipped several thousand packages that have gone to every US state as well as 50 international countries. Here are a few useful tips that you may want to incorporate into your own shipping practices.

1.     Keep a shipping “cheat sheet”. This can be a simple spread sheet that has the dimensions, weight, and cost of all of your boxes and shipping supplies. This will save you a lot of time when it comes to calculating shipping costs.

2.     Let the pros pack the crazy stuff. Simply get the (approximate) weight and dimensions of any oversized item that you’re trying to sell and call a local shipper to get a quote (I usually ask for a quote to ship to both Los Angeles and New York). Then, include the shipping cost in with the cost of your item and offer “free” shipping to make the item more appealing.

3.     Why not self insure? Shipping insurance is expensive, especially if you ship in high volumes. If you track the amount of shipping insurance you purchase versus the actual amount of claims that you make, oftentimes, the companies that sell you the insurance are earning hundreds or thousands of dollars extra, even after paying out claims.

Domestic shipping insurance is roughly $0.90 to $1.50 per $100 of coverage. So, for every $100,000 worth of goods that you ship, you’re spending $900 to $1500 on shipping insurance, but you’re probably not making claims in that amount (at least not if your packing and shipping items carefully.)

My advice is that for every $100 in sales, set aside $1 in a separate escrow account for insurance. Have a maximum amount that you’re comfortable self-insuring (say $500 to $1000) and purchase insurance if you’re shipping high-value items, so you don’t wipe out your escrow account or impact your bottom line significantly.

The benefits of self insurance are two-fold. One, you can process claims much faster yourself than waiting for someone else to do it, which means it will improve your customer service & retention. And two, any money left over at the end of the year can be reinvested back into your business, or can even serve as a nice year-end bonus to the shipping department for a job well done!

How to sell valuable items on eBay – Chapter 1

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Over the course of the next few weeks / months, I’ll be writing about how I go about selling valuable consignments. This information was gained through thousands of hours of selling on eBay, as well as a lot of trial and error. I welcome any questions / feedback that you have and hope that people out there will find these articles useful.

 

Chapter 1 – What is the market for my item?

The first thing I do whenever I have something that I think is valuable is to try to research current sales trends for the item. This means that you want to find out what an identical or similar item has sold for recently (ideally, two years or less), as that can be a good indicator as to what others are willing to pay for the same item.

Please note, this does not mean that you will go straight to Google or eBay and look-up the current listed price for the same item. Oftentimes, items that are currently listed for sale may be vastly overpriced (hence, that is why they are listed for sale and not already sold!)

Here are some different venues that are helpful in researching your items:

eBay – eBay is the largest online marketplace in the world, where you can find everything from Russian meteorites to vintage underwear, (yes, people collect both,) all under one “roof”. It’s also an incredibly valuable and FREE resource that you can use to research almost anything for sale. All it requires are a few small modifications when you use the search feature

The easiest way to research recently sold items on eBay is to click on the “Advanced” button. Next, enter in a few keywords to describe your item. The scroll down a bit and be sure to check “Sold Listings” button, then click search.

To explain what this does, imagine if eBay was a huge store with everything currently for sale being in the front of this store. You can quickly search for most items by using the standard search bar on the eBay homepage. However, by searching the “Sold Listings”, you’re now getting to peak in the back of the store, where they keep records of everything that’s sold in the last 6-8 weeks.

Why is important? Because not only will you be able to see the pricing information for the sold items, you can see how the format in which it was sold (auction vs. fixed price), how the items were photographed and written-up, etc. I usually organize my results by price (highest to lowest), so I can quickly understand which items are selling for the most money (and why). Be sure that the condition of your item matches the condition of the items that you’re looking at (otherwise it may sell for less if it’s in poorer condition, or perhaps more if in better condition).

Terapeak is a subscription service (currently $25 per month) that can be accessed either as an app through eBay or through its standalone website or smartphone app. Terapeak essentially stores a huge amount of sales data from eBay, allowing you to research sales trends back to a year (or more) from eBay. Additionally, you can see the sales price for any item (even those annoying “Best Offer Accepted” items), research “hot” sales trends in many categories, and even get an x-ray view of competitors (which includes their top sale items, total listings, total sales, and sell-through rate!)

Christie’s & Sotheby’s are the two largest and most well-known international auction houses. They tend to have the highest profile art and jewelry sales in the world. Both auction houses provide the ability to search through completed sales as far back as 10+ years, providing pictures and sales descriptions in addition to pre-sale estimates and hammer prices.

Live Auctioneer is an auction website that serves as an online platform for a number of regional auction houses throughout the United States and Europe. In addition to being able to view upcoming auctions, Live Auctioneer maintains a database of previously sold items, ranging from $5 in value to several million dollars. The website is free, but registration is required to search the database.

Heritage Auctions is the third largest auction house by volume in the world and does particularly well selling coins and sports collectibles. They receive an interesting array of consignments and maintain a past sales results database that includes excellent pictures and descriptions of most of the items sold. The website is free, but registration is required.

Worthpoint is a subscription based service that aggregates both eBay sales data as well as data from a number of regional auction houses in the United States. The database goes back as far as 12 years. I find it particularly helpful when researching obscure or hard-to-find items without a lot of information elsewhere.

Ask Art is another subscription-based service that serves as a database for art. Artists can be researched by their last names, with results that provide full names, birth / death information, bios (if available), as well as examples of works sold and their hammer prices.

There many other databases / subscription services available online or in print, but these are the ones that I found myself using most frequently while selling on eBay.

Now that you have an idea of whether or not there’s a market for your item (and assuming that there is), does the item meet your sales expectations? In most instances, the retail price (original purchase price) of the item will be much higher than the resale price that you’ll find online. Additionally, be aware that appraisal values (particularly for jewelry) are often much higher that what may be possible if you resell your item, as most appraisals were conducted for insurance purposes and not for resale purposes.

 

Shipping Shape: How to Ensure that your Gifts Arrive Safely and on Time this Holiday Season

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Since many of us have friends or family that we’ll be mailing gifts to this holiday season, I decided it might be helpful to share a few packing and shipping tips that will save you time and frustration.

  1. Pack appropriately. Books and clothing are ok to ship in bubble mailer envelopes. Christmas ornaments are not. Anything fragile, including glass, porcelain, and electronics should be package in an appropriately sized box, ideally with 2” or more of cushioning between the item(s) and the sides of the box. If you’re sending multiple fragile items in the same box, be sure to wrap each piece separately in multiple layers of bubble wrap and/or clean newsprint. Consider double boxing the contents for added protection.
  1. Get tracking and insurance. USPS Priority Mail packages automatically include tracking and up to $50 of insurance coverage, while UPS and FedEx packages include tracking and up to $100 of insurance coverage. If you’re going to ship valuable items (such as jewelry or expensive electronics), be sure that the package is insured for the full value and consider adding signature confirmation to the package. After all, you don’t want Grandma’s new iPad walking off the doorstep, do you?
  1. Keep your receipts. If you do have problems with a package getting lost or damaged, the shipping company will need to know the tracking number, shipping cost, the value of the item(s), proof of damage (pictures), and a repair or replacement estimate. Gathering this information prior to filing a claim will help save you time and additional hassle.
  1. Avoid the lines. You can purchase postage from the USPS, FedEx, and UPS directly from their websites and sometimes at a discount versus their counter rates. The USPS will even pick-up packages for free at your doorstep (FedEx and UPS charge a $5 fee), providing you schedule a pick-up through their website. This can be a huge timesaver, especially if you have multiple or oversized packages to send.
  1. Don’t procrastinate. Remember last year when Amazon overpromised and UPS under delivered, right before Christmas? Don’t wait until the last minute (like everyone else) and expect your package to be delivered on time. Add at least 1-2 days to the handy holiday shipping guide available at shipstation.com/blog and you should have a reasonably good change of your package(s) arriving on time.
  1. Be nice to your delivery person(s). They work long hours in cold weather and have families at home, too. USPS employees can accept gift cards valued at $20 or less, while freshly baked goods or cookies are usually welcomed by all delivery drivers.

Having the Holiday Chat

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Lets be honest, kids have different tastes than their parents do. This is evident to any parent who has children that want to dress themselves, feed themselves, and decorate their own rooms. So why is it reasonable to assume that when we die someday, our kids will want to inherit all of our things?

With the holidays coming up, it’s a good time to sit down with parents, grandparents, or other family members to discuss downsizing and what they want to do with their estate someday. “Let the kids deal with it,” should not be the end of the conversation. Anyone that has ever had to deal with an unexpected death in the family or a large and complex estate knows that it can be a very hectic and stressful experience, especially combined with the mourning process and/or making funeral arrangements.

It’s typically much easier for parents and grandparents to gradually downsize possessions and to involve their families in their plans to distribute personal property, particularly if it includes any family heirlooms. It could be as simple as sitting down with family members individually or as a group and asking them what they’d like.

Assets not wanted by heirs can either be donated to a local charity or equitably distributed if the property is sold with the proceeds divided amongst the recipients. If you don’t think your grandchildren are going to enjoy your Hummel collection as much as you did, why not sell it and take them on a trip, add to their college fund, or do something nice for yourself?

The end of the year also serves as a good time to update wills, personal property inventories, and insurance coverage. While these activities are certainly not fun and exciting, they’re import and will provide a good deal of peace of mind if / when you need to use them.

 

The original article can be found in the November 2014 issue of Southern Neighbor available here: www.southernneighbor.com.

When to Get an Appraisal

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An appraisal is an estimate of value of an item by an expert in the field. A formal appraisal is written and can serve as a legal document in the event of damage, loss, or in a legal dispute. It may include provenance (history of ownership), specific features of an item (such as cut, color, and clarity for diamonds), and an estimate of replacement value. Appraisals can be done on anything from art and jewelry to coins and comic books. So when is a formal appraisal necessary and when can it be skipped?

Formal appraisals should be performed on any rare or valuable personal property that the owner wishes to insure. In the event of loss or damage, an appraisal provides proof of ownership and value to the insurance company, which will work with the owner to either provide a replacement or compensation for the item.

If you have an item that is inexpensive or you’re simply curious about what it may be worth, there are several steps to perform an informal appraisal of an item.

Step 1: Is the item authentic? Depending on the item, this step can either be very easy or very hard. Certain items such as art or autographs require specialized training to authenticate, so if you suspect it may be quite valuable, it may be wise to have professional look at the item. If the item has any markings or special features, be sure to compare them to other items that have previously been authenticated.

If you are the original owner and purchased the item from a reputable source (such as buying a luxury handbag directly from the manufacturer), then it’s reasonable to assume that your item is authentic.

Step 2: What is the condition / completeness of the item? Items that are as close to new condition as possible will usually bring the highest value (with exceptions being if the item was owned / used by someone famous or in a historical context.) A small chip in a porcelain figurine might lower the value as much as 25%, while a significant repair can affect the value by 50% or more. If an item has multiple pieces, such as a vintage board game, are all of the pieces included and in good condition?

Step 3: What have comparable items sold for recently? Sales information on the same / similar items that have sold in the last 3-5 years can provide a good estimate as to what your item would be worth if you were to sell it. Good sources for this information include eBay, Live Auctioneers, individual auction house websites, and subscription websites such as Worthpoint.com and Askart.com .

 

The original article can be found in the October 2014 issue of Southern Neighbor available here: www.southernneighbor.com.

Online Bidding Etiquette

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I recently had a buyer purchase a beautiful diamond tennis bracelet from me at auction on eBay. I shipped it expedited for free with a current appraisal. She exclaimed that she was in love with it until she took it to her local jeweler, who said that she paid too much for it. (Keep it mind that she purchased it at auction where she decided the final bidding price.)

After several e-mails back and forth, I allowed her to return the bracelet even though buyer’s remorse is not normally a valid reason for return (items arriving damaged or different than originally described are acceptable reasons for returns). After I received the bracelet and provided a refund, I was rather flabbergast when she contacted me again asking if it would be ok for her to bid on the bracelet again, with the hopes of buying it at a lower price. At that point, I said “no” as politely as I could and blocked her account.

EBay is what you’d call a hybrid auction site, mixing items that are listed for sale at fixed prices as well as those that are being auctioned. With a bit of knowledge (and luck), it’s a great place to get deals on a number of things. You just have to know how to ask for them.

Many sellers list items on eBay with a fixed price and also include a “Make an Offer” feature that allows interested buyers to offer a lower amount on an item. A reasonable office might be 50% to 90% of the original asking price, depending on what similar items have recently sold for. If you’re not sure what to offer, simply ask “What’s you’re best price on this item?” It’s a perfectly acceptable way to negotiate a better price without a lot of haggling and avoids the risk of making an insultingly low offer to the seller.

If you’re considering buying something that’s being auctioned, it’s a good idea to review the item description and pictures carefully, in addition to the shipping and return policies (and any other fine print included in the listing). Most experienced sellers are very thorough in addressing common concerns in the listings, such as including item dimensions, damage/defects, or the ability to combine multiple purchases in a single shipment. If there is any information missing or not clear, it is best for the prospective buyer to ask questions before placing a bid, so that they have all of the information necessary to make an informed buying decision.

Auctions also have a tendency to pull bidders in emotionally. It’s exciting to outbid several people and “win” an item in the closing seconds of an auction. However, you should make sure beforehand that the amount you’re bidding is what you feel the item is truly worth (and more importantly, what you intend to pay!) There are few things more frustrating that having a buyer attempt to back out of a sale as soon as an auction is over. This costs the seller both time and money and typically results in the buyer being blacklisted from future sales by that seller.

If you’re not quite sure about how something works (whether it’s the item or the auction process itself), it never hurts to contact the seller or auctioneer in advance to ask several questions. Most sellers are more than happy to educate / accommodate their buyers, proving that the request is made with respect and in a timely manner.

 

The original article can be found in the September 2014 issue of Southern Neighbor available here: www.southernneighbor.com.

The Power of Provenance

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In simplest terms, “provenance” is defined as the origin of something. In the realm of art, antiques, or anything collectible, it’s typically an account of ownership or historical significance of a piece.

Provenance can greatly enhance the value of what may otherwise seem like an ordinary item. An old baseball bat may be an interesting collectible, but what if you were able to prove that it was used by Babe Ruth? The value would be greatly enhanced at that point.

When it comes to art, provenance is the chain of ownership from the earliest purchase or transfer of the piece to the current owner. It may include the original purchase receipt, formal appraisals, or even a sales slip from the gallery or auction house where the piece was obtained.

ARosan item doesn’t have to have been owned by someone famous to have provenance. One of the more interesting items that I sold last year was an antique blond china head doll. They aren’t particularly rare, but what set this doll apart was that it came with an 1850s era picture of the original owner with the doll and a hand written letter from her granddaughter describing both the doll and her owner. “Rosa” ended-up selling for about three times what I would normally expect to get for a similar doll, just because we were able to provide some historical context about her ownership.

Items with historical ties are often purchased by collectors of particular genres. A gentleman who purchased a dinner chime from me that originally belonged to the RMS Queen Mary told me that he also had the ensign (flag), dinner service for 12, and even an original phone booth from the ship. Being able to find one-of-a-kind pieces for unique collections often means that collectors are willing to pay a premium for these items.Chime

So what’s the best way to document the provenance of a particular item if you don’t have a receipt or series of appraisals? Photographs can serve as a good indication of provenance, particularly if the item is photographed with people or at events that can be historically traced. Additionally, an official account of ownership can be provided by a family member related to the item or the current owner of the item. This account is provided in a written affidavit that is signed and then notarized.

Do you or a family member own anything with interesting provenance? If so, please consider e-mailing your story so that it can be shared with other readers in a future issue.

 

The original article can be found in the August 2014 issue of Southern Neighbor available here: www.southernneighbor.com.

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