The Auction Whisperer

In the world of auctions, you not only have to advertise your location, your hours, and your auction dates, you also have to advertise your merchandise and that merchandise changes with ever auction.

It is difficult to keep auction ads small in order to keep costs down. If you have an auction with three hundred or more items, you have to advertise a number of those pieces. You cannot just say that you have three hundred antiques and collectibles. You need to attract the people who are looking for exactly what you have.

As an auction house owner, you will be legally responsible to get the most money you can for the items that have been consigned to you. If you fail to properly advertise those items, you are asking for trouble.

Not only is print media no longer as effective as it once was, it is much more expensive than it once was. The per word or per line classified advertising rates in most major newspapers increase pretty frequently. However, the subscription numbers for most of them are on the decline.

Since your ad copy has to change with each and every auction, it can be very cost prohibitive to do radio spots. The set-up costs alone would eat up your ad budget in no time.

What’s the answer? Internet advertising. It can reach the most people and it is the least costly. Don’t get confused by auctions on the Internet. There are online auctions that only sell online. There are also real brick and mortar auction houses that take live Internet bids in real-time. The Internet bidders compete against the bidders that are physically present at the auction house. Then there are real brick and mortar auction houses that only take bids from people on the auction floor, but they advertise their auctions on the Internet.

There are several sites that will allow you to post each of your auction events for free. On these sites, not only can you post as much text as you want, you can also post as many pictures as you want. Buyers in your area will see these ads and will attend your auctions if you have what they want. You may also get business from buyers who are on the other side of the country. If you are willing to accept telephone bids, and agree to provide shipping at their expense, you can seriously expand your business at almost no additional cost.

It would also be in your best interest to have your own website. The initial cost for setting one up is only a few hundred dollars. Once your website is active, you can advertise all you want without worrying about paying so much a word or so much a line, like you have to do with print media. As the expression goes, a picture is worth a thousand words. Putting pictures on your website of the better items being offered for auction is an impressive sales tool.

At one time, an auction house owner might have spent upwards of 30% of their budget on advertising. Now, you can have an effective advertising campaign for around 10% or less.

Of course the best and cheapest form of advertising for any auction house is word of mouth. If you treat both your buyers and your sellers fairly, they will tell someone, who will tell someone, who will tell someone. Well, you get the idea.

It goes without saying that your main role in your new auction business will be that of owner. But, as the future owner of a small business, you need to realize that you won’t be sitting back in your office with your feet up on the desk. In the auction business, you will be lucky if you get to see your desk very often.

The two biggest expenses any auction house owner faces are salaries and advertising. You need to have enough employees to properly conduct business but you cannot afford to hire someone to do a function that you can do yourself.

What are you good at? If you are good at marketing, then you are the person best suited to be in charge of special promotions, advertising and customer service.

If your background is in accounting, they you can save yourself a truckload of money by doing your own bookkeeping, taxes, and consignment payouts.

Have people told you that you have an outgoing personality? Do you like dealing with people? Are people drawn to you because you are fun to be around? Then look in the mirror and say hello to your new auctioneer. This is the area where you stand to save the most money. Having to pay a freelance auctioneer to call each of your auctions is a very expensive proposition.

Should you decide to be your own auctioneer, in approximately half the states, you will need to go to an auction school and pass a written and oral test to secure the required auctioneer’s license. In the other states, a license is not required. However, you want to do a good job for your business so auction school is a must no matter what.

If you are extremely knowledgeable about antiques and collectibles, and are a well-organized person, then you may want to serve as your own auction manager. This means you would set up the auction by identifying all of the merchandise, writing it up and grouping it in such a way as to bring the most money.

You need to evaluate your own strengths and weaknesses. Hire yourself to do the particular job for which you are best suited. Then you can make decisions concerning the rest of the staff you are going to need.

Customers are creatures of habit. If you provide them with exceptional service, along with good merchandise, they will usually continue to do business with you out of loyalty, routine or preference. To help you succeed in the auction business, you will need to make something about your service special.

However, before you decide on the ins and outs of how you will attract as many customers as possible, you need to investigate the pool of customers available to you. You can do this by checking out your competition.

Once you have settled on a location for your business, you need to research that area. How many other auction houses are there in a thirty-mile radius? Although customers will go where the good merchandise is, a distance greater than thirty-miles is pushing it when you are looking for repeat business.

Remember, competition is good, not bad as some might have you believe. This is especially true in the auction business. A good selection of antiques and collectibles from several sources will draw a lot of people, even people from out-of-state. Although these people will not necessarily do a lot or repeat business with you because of the distance, they will tell their relatives and friends about you.

If there are a number of auction houses in the area you have selected, what kind of auctions are they? If you are going to open an antiques and collectibles auction house, then you need not be concerned with a food auction, or a cattle auction or an automobile auction. Your only competition is other houses selling antiques and collectibles.

If there appears to be quite a few – you have to do more research. You will need to attend each and every one of these auctions more than once. Are they doing landmark business? Do they have a lot of good merchandise? If so, it is possible that your area will be able to support another auction house? If the merchandise is sparse and not very good, and if there are not many bidders in attendance, there may already be one too many auctions servicing your vicinity.

If you only find one or two auction houses, then you need to ask yourself why. The biggest customers of any auction house selling antiques and collectibles are antique dealers. How many antique shops are nearby? The more antique shops the more demand there is for antiques from residents in the surrounding area. If there are not many shops, then there is no demand.

When doing this important due diligence, make sure you are not evaluating your potential competition during the height of the tourist season. If the location you have chosen has a tourist season, keep in mind that it also has an off-season. You want to know how good or not so good you are going to fare under normal business conditions.

If you feel there is enough business to support another auction house, before making your final decision, find out if any auction houses have recently gone out of business in that area. It may look like one more auction house is doable but one might be enough to tip the scales against you. If someone did close an auction house nearby see if you can find out why. Maybe that person lives locally and would be willing to speak to you about what happened to him or her.

You don’t mind working hard to make your business a success, but you do not want to have to fight tooth and nail to get decent merchandise, not to mention customers, auction after auction. If you have good contacts or your own suppliers, then you will be way a head of the game. Without them, you may find yourself up against the eight ball before you even begin. Do your homework.

As you have heard over and over again, the key to any successful business is location, location, location. This is not just about a street address. Everyone wants their business to be on a busy street but, when starting an antiques and collectibles auction house, you also want it to be in a busy town.

A rural area may work for some auction businesses, such as cattle or horse auctions, but if you are more into antiques and collectibles, you must be where the action is. Not only do you need to secure bidders for your auction, you also need to secure merchandise.

The town or city you choose should have antique shops, a flea market and a busy residential area. Some of the best merchandise, not to mention the cheapest, can be obtained at yard sales or garage sales. Hopefully the area you select will have an older population. The older the population, the better chance you will have to score the collectibles and antique furniture you will need to support your auction.

It is also important to look for a location where there is a number of larger companies. The bigger a company is the more offices or branches it has. This means there is a greater opportunity that workers will be transferred in and out of your town or city. People who are required to relocate are often faced with liquidating their household furnishings before moving on or buying new household furnishings before moving in.

Many companies give the employees they transfer an allowance for setting up a new home or apartment. This can sometimes be cheaper than paying a mover to relocate their existing possessions. One of the reasons for this is there is always the chance that their current furniture and accessories may not fit or work well with their new temporary housing.

Some of the people moving in and out of your town may buy what they need directly from you. If not, they may buy what they need from the local antique or specialty shops. This doesn’t matter because the owners of these shops have to buy their merchandise from someone. Whether the sales come to you directly or indirectly doesn’t really matter. What matters is having the seats filled every time you have an auction.