This article provides basic information related to auctions and the auction industry.
This article contains the following sections:
What is an Auction?
As described by Investopedia:
"An auction is a sales event wherein potential buyers (bidders) place competitive bids on assets or services either in an open or closed format."
- The auction industry consists of third-party dealers that organize auctions for items, which are often considered to be rare or highly sought after.
- Products sold can include artwork, cultural artifacts, jewelry, cars or other items that generate demand from the industry’s client base.
- Industry operators (auction companies) often act as a broker of these goods, selling items on behalf of the current owner (consignor).
- Industry operators (auction companies) add value by being able to match bidders to sellers, handling payments, and certifying the authenticity of items sold at auctions.
Proxibid provides a platform for buyers to purchase items directly from reputable auction companies and dealers to create a trusted Marketplace. For more information regarding sellers on Proxibid, see Proxibid Sellers.
Types of Auctions
This auction method type is run by a computer set on predefined automated closings. In Timed auctions, bidder place pre-bids on items in the catalog and then the auction closes automatically at a pre-designated time. Timed auctions are generally online and accepting pre-bids for a least a few weeks.
Timed auctions must have a set opening and closing dates, and bid increments in place prior to accepting bids. Bidders enter their bids against other competing bidders on the internet for the same item.
For more information, see Timed Auctions.
The auction method type where the auctioneer has control of the inventory being sold in real time. These auctions may be live only, or can be live while also being webcast, or simulcast, online.
Some live auctions allow pre-bidding, while others do not.
Live auctions are clerked in real time. The clerk's role is to use software to mark items as sold as they are being auctioned by the auctioneer. The clerk will take note of the selling price and who the item was sold to.
For more information, see Live Auctions.
Bid: The price offered for an item available for auction. A prospective buyer's indication or offer of a price he or she will pay to purchase property [goods] at auction. Bids are usually in standardized increments established by the auctioneer. Placing any kind of bid in an event is a commitment to purchase the item from the auction house in the event that you have the highest bid. For more information about bidding, see Bidding on Proxibid.
Bid Increment: The minimum amount a bid can be increased by. The bidding increments are set by the auction company.
Bidder: A person who engages in the act of competitive bidding at auction. or more information about bidding, see Bidding on Proxibid.
Bidder Number: The number issued to each person who registers at an auction. Also known as a Paddle Number.
Buyer: A bidder (winning bidder) whom is awarded the high bid at the close of bidding on an item at auction.
Buyer's Premium: A fee sellers may charge a buyer that applies to the final purchase price of an item. The Buyer's Premium may be a percentage of the high bid or a flat fee added to the high bid. Either way, the Buyer's Premium, taxes, shipping, and additional fees may be added to the purchase price to generate the total owed by the winning bidder. The fees an auction company charges should be listed in the event's Terms of Sale.
Closing: The time that the last bid will be accepted - the end of the auction.
Consignor: Entity that has legal possession (ownership) of any interests, benefits or rights inherent to the real or personal property.
Estate Sale: The sale of property left by a person at his or her death. An estate auction can involve the sale of personal and/or real property.
Extended Bidding: A feature specific to Timed auctions that, when a lot receives a bid within the closing minutes of the auction, additional time is added to the available bidding time on that item until time runs out or no more bids are placed on the item.
Group Lots: Single items can be sold in groups, either for one price or by having the highest bid multiplied by the quantity of items.
Hammer: The 'hammer' or 'hammer price' refers to the amount a lot sold for, or the winning bid. It is the price established by the last bidder and acknowledged by the auctioneer before dropping the hammer or gavel. The hammer does not include any other fees that may be charged to a bidder on their invoice.
High Bid: The highest current accepted price for an item at auction.
Hold: The ability to run a verification of funds which is immediately released in order to participate in an event. For more information see atgPay: Fund Verifications
Initial Bid: The lowest amount that can be entered by the bidder. This amount is set by seller and is also known as the minimum bid.
Maximum Bid: A maximum bid is a pre-determined amount that a bidder is willing to bid up to. When a bidder enters a maximum bid, they are telling the Proxibid application to place bids on their behalf, not exceeding the maximum amount. For more information, see Maximum Bids.
Once/Twice: Visual notifications in the live bidding application indicating the bidding on an item is about to close.
Onsite Bidder: An individual in attendance at the live auction who has been approved to participate in the event.
Pass: Decision made by the Auctioneer and/or seller to suspend the sale of an item at auction due to absence of bidding, insufficient bidding, or withdrawal of the item.
Pre-Bids: Pre-bids are bids made in a Timed auction or before a Live auction has gone live. Pre-bids can be instant bids or maximum bids, and are simply bids made in advance. Some sellers may refer to pre-bids as "absentee bids". Pre-bids are automatically represented for a bidder during an auction, up to their maximum bid. For more information, see Pre-Bids.
Preview: Specified date and time property is available for prospective buyer viewing and audits. Also known as “Open House” or “Inspection”. If a preview date is being offered for a sale, it would be listed in the event's Terms of Sale.
Relisting: The process of listing an item again if it did not initially sell.
Reserve: The minimum price that a seller is willing to accept for an item in order to sell it at auction. Also known as the Reserve Price, or Ask Price.
Sold: The status assigned to an item when bidding has met the minimum amount required by the auctioneer/seller on an item and the auctioneer has declared the item as “Sold”.