Hiring An Auction Company

Estimating your assets value:

Typically, one of the first questions a business owner will ask me is, “how much will the assets bring at an auction”. After taking the time to review the assets, the auctioneer should give the client a conservative estimate of the sale based upon his experience and the current market trends. It is important that the company give realistic expectations so the seller can make informed decisions based on their best interest.

Compensation and Expenses:

Is the company you are considering working for you or against you? The agreement you decide may determine this.

A business owner should carefully consider how the auction company is compensated. The most common commission structures include: straight commission, outright purchase of assets, guaranteed base with a split above to both auctioneer and seller, guaranteed base with anything above going to auctioneer or a flat fee structure.

In a straight commission structure, the company is paid an agreed upon percentage of the total sale.

In an outright purchase agreement, the auctioneer simply becomes your end buyer. The company purchases your assets and relocates them. While this can be an option in some unique situations, keep in mind that they will want to purchase your assets at a very reduced price to make a profit at a later date.

In a minimum base guarantee, the auction company guarantees the seller that the auction will generate a minimum amount of sales. Anything above that amount either goes to the auction company or split with the seller. While a seller might feel more comfortable doing an auction knowing that he is guaranteed a minimum amount for his sale, keep in mind that it is the best interest of the auction company to secure a minimum base price as low as possible in order reduce their financial liability to the seller and secure higher compensation for the sale.

In a flat fee structure, the auctioneer agrees to show up for the sale and call the auction. There is no incentive for the auctioneer to get the best prices for your assets. The auction company is compensated regardless of the outcome of your sale.

What is the best option for business owners? In my experience, an agreed upon straight commission structure. This puts the responsibility on the auction company to offer the best outcome for everyone involved. There is an incentive for the auction company to work hard for both parties, set up and run a professional sale, get the highest bid and sell every item on the inventory. Successful auctions translate to a higher bottom line for both the seller and the auction company.

Auction Expenses:

In most auction agreements the expenses to conduct an auction are passed to the seller. If the auction company pays for the expenses, it is simply absorbed in higher commission rates.

All expenses should be agreed upon in advance in a written contract. Typical expenses will include the costs of advertising, labor, legal fees, travel, equipment rentals, security, postage and printing. A reputable auction company will be able to estimate all expenses based upon their experience in previous auctions. An agreement should be actual costs charged as expenses, not an estimated amount.

Advertising is typically the highest cost in conducting an auction. The auction company needs to set up an advertising campaign that will promote the sale to its best advantage and not overspend to simply advertise the auction company.

Once the auction is complete, the auction company should provide a complete breakdown of all expenses to the seller, including copies of receipts within the auction summary report.

Buyer’s Premium:

What is a buyer’s premium? If you attend auctions regularly, you are very familiar with this term. The auction company charges a fee to the buyer when they buy an item at auction.

The buyer’s premium has been around since the 1980′s and is standard auction practice. It was first used by auction houses to help offset costs of running brick and mortar permanent auction facilities. Since then, it has spread to all aspects of the auction industry. It is prominent in online auctions and allows auction companies to cover added expenses incurred from online sales.

It is the responsibility of the auction company to provide clear disclosure of the buyer’s premium to both the buyers and the sellers. Those not familiar with auctions are often taken back by the buyer’s premium. They looked upon it as an under handed way for the auction company to make more money. Reputable auction companies will provide full disclosure within the auction contract, advertisement and bidder registration.

Typically, an auction company will charge online buyers a higher buyer’s premium percentage than those attending an auction in person. Extra fees are incurred with online bidding and are charged accordingly to online buyers. This provides the seller a level playing field for both online buyers and those attending the auction in person. Without the buyer’s premium, there is no way to do this.

Pre-Sales:

We’ve all been there. We’re looking forward to attending an auction only to find that some items were sold prior to the auction date.

As an auctioneer with over thirty-six years of experience, I can honestly state that pre-sales will hurt an auction. When a company decides to liquidate their assets, it is easy to sell off high-end pieces of equipment through online sources, equipment vendors or to other businesses. The seller receives instant cash and avoids paying a commission to an auction company.

Auctioneer’s find themselves appearing to acting in a self-serving capacity when potential clients say they are planning to sell off parts of their inventory prior to an auction. It’s hard not to consider the auctioneer’s commission when they warn you not to pre-sell anything. Yes, the auctioneer wants to earn a commission on those sales but it is more important that the auctioneer protect the sale from potential negative backlash that comes from pre-selling. The buying public knows when an auction has been “cherry picked” prior to the sale and it reflects in their bidding. It becomes a sale of “leftovers” and that impacts prices.

A buyer who purchases prior to the auction usually does not attend the sale. They already bought equipment at a good price with no competition. If they do attend the auction, they tend to let others know of their great pre-sale purchases which again, impacts prices and the overall excitement of the sale.

It is important to understand that auctions work best with a complete inventory. You want competition on your higher end equipment. The easy to sell items make it possible to gain respectable prices for hard to sell items.

When a business owner decides to liquidate their equipment assets, there is only one opportunity to do it right. Hiring a reputable auction company will assist you with a professional, orderly and timely liquidation.

What’s Going on With the MLM Home Based Business?

Are you looking to own a network marketing home based business? If you are, it can be a very profitable for you to own a home based business. But you will have to do your homework first; to make sure you are getting into a home based business that is worth your time, invest and make sure it isn’t a scam.

You must look at the positives and the negatives of an network marketing home based business before just jumping in. That’s extremely important remember that.

Being aware you are getting yourself into a legit, honest home based business will save you a lot of money and heartache later on. Just jumping into the first home based business you see can be a killer for you, if the business turns out to be a scam.

You don’t want that right!

So with a network marketing business it involves you doing direct selling of services or products through recommendation or promotion by a independent representatives.

If you are the one who’s endorsing or recommending the product or service you will get a commission from any sale you made.

Remember a lot of these products are not sold in stores, commercials or any type of advertising that is mainstream.

So when you are trying to see which network marketing home based business is legit, it can get a little difficult because the pyramid schemes are closely similar to the legit, and honest network marketing home based business concepts. A ponzi or pyramid scheme is big time illegal and participating in one and not knowing it can end up being a nightmare for you.

So make sure you do that research on the company you are looking to join. Make sure if the company has been around for sometime. You want a company that has a proven track record. Let me mention, this usually the investment you make is proportioned to that product or service you are promoting. Means your home based business is legit.

There many positives when you own a network marketing home based business. But I will break down a few of them.

1) With your own network marketing home based business, you will be your own boss. You have the ability to work from the comfort of your own home. That’s what drives many people to join a home based business.

Also when comes down to the products you don’t have to worry about creating them. The products are already created, there’s no inventory you have to keep. Most of the time The company will have a written out marketing plan.

There’s many people who don’t have a clue on how to market products or if they do know how to market products they don’t know the most effective ways to do it. But with an network marketing home based business biz you don’t have to worry about it because its given to you an a step by step plan.

There disadvantages when having a network marketing home based biz that is it depends your character or personality. If you are a action taker, have good leadership qualities then having a network marketing home based biz will be less of a problem for you.

On the other hand, if recruiting others and selling gives you problems or if you are not a peoples person then maintaining and growing a network marketing home based biz may become a challenge for you. In the network marketing home biz this business consist of recruiting new people and building your downline.

If you can get over your fear. Just think what a network marketing home biz will mean to you and your love ones. You can (live your dreams, be your own boss, work when you want to, make more money etc…) With this business you don’t need any experience just hard work and being consistent.

Remember you must do your research before just jumping into a network marketing home based biz. You have to make sure the business is legal and worth your time, energy and investment. So when you find that right network marketing home based biz, you must put in the hard work and the consistency. You will enjoy the freedom and the money the network marketing home based biz can give you.

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Generate Income Online Through Your Own Home Based Business

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