Auction is a process of buying and selling goods or services by offering them up for bid, taking bids, and then selling the item to the highest bidder. When an item you want goes up for bid it will usually start low and the auctioneer will raise the bid amount every time someone bids until there are no more bids on that item at which time they will sell the item for the highest bid.
There are many types of auctions. Some of the most common are Charity, Estate, Liquidation, Consignment, Auto mobile, Antiques, Coins, Storage units, Foreclosures, real estate, and many more.
All bidding is conducted online over a specified time period typically ranging from a few days to several weeks. There will be a defined start and end time, although different lots may have different start/end times. Last minute bids will usually result in the closing time being extended, so the highest bid always wins.
The traditional auction conducted by an auctioneer either in their saleroom or at an on-site location with bids submitted from the floor or by telephone. All potential buyers need to register in order to bid and may need to leave a deposit. Bids are accepted in ascending order with the winning bid signalled by the auctioneer, usually with a call of “sold” and a drop of the gavel. These sales do not support online bidding.
As for the live auction but in addition to bids from the floor, the auctioneer will also take online (sometimes referred to as “Webcast”) bids submitted and relayed to the auctioneer in real time via a computer screen/terminal. Potential bidders are usually vetted at the registration stage to make sure they are genuine.
This is a traditional sale method which may be conducted on or off line. The seller invites offers for the goods and then negotiates with interested parties to obtain the best price.
Fixed Price Sale
Some auction platforms now have an Ebay type “Buy Now” option, which gives the buyer the opportunity to purchase at a fixed price. This method is ideal where the seller has a price at which they are willing to sell and the buyer is happy to purchase at that price, avoiding a bidding war with the competition. If conducted offline, potential buyers will attend the sale site where the price will indicated on the goods for sale, for example “25% off marked price”.
The selling agent invites one-off written or online bids from interested parties, to be submitted by a given deadline, with the sale going to the highest offer. This is often the preferred method of sale for highly specialised items where the potential market is limited.
Why choose an auction over other sales? There are many reasons but if you look at many of the high record setting prices that people get for property is done at auction. A good marketing plan for an auction brings people who are looking for the item being sold and the more people you have at an auction then better chances of getting good prices. When you have two or more people competing for the same item the price usually goes up.
The difference various types of auctions?
An Estate Auction is where someone has passed away and their items, possessions and property is being sold.
A Liquidation Auction is usually where a business in going out of business because of various reasons and they need to sell off their inventory. Many times these are court ordered because bankruptcy.
Consignment Auction: Multiple sellers who have large amounts of items to sell but not enough for a single auction. So the seller consigns the items with the auctioneer for a designated auction date along with other sellers who are also consigning items.