High Reserves Cost Everyone, Especially Proxibid

We’ve mentioned this before as an abuse of the Proxibid portal–the setting of high opening bids or reserves (sometimes ridiculously high)–enabling a handful of auctioneers to use the portal as their own free eBay coin store, in as much as they do not have to pay the portal for lots that do not sell. We’re hoping Proxibid’s policy has changed so as to charge those houses for passed lots … because other auctioneers are footing the technological costs.

Some companies selling coins on Proxibid upload hundreds of pictures on the portal and hype lot descriptions to their hearts’ content, all of which would cost per item on eBay.

Each coin as listed would require an eBay insertion fee, upgrades for multiple pictures, plus additional money for reserves and length of sale. You can get much of this without cost on Proxibid and use the portal as an inexpensive online coin store, guaranteeing retail prices and above for any item that happens to sell to an uninformed bidder.

Take a look at eBay fees by clicking here, and you can see what a bargain Proxibid actually is.

While it is true that some items require a reserve, and that auctioneers should decide whether or not to sell an item, those traditional rules assume that the house is not taking advantage of the system and that other lots lack high opening bids.

Look at it this way: What auctioneer in a traditional onsite location would be in business for long if 80-90% of lots failed to meet reserve? Just as there are setup costs for onsite auctions, there are technological costs for online ones. On Proxibid, those costs are distributed.

We’re not asking that Proxibid cease allowing opening bids or reserves; that’s part of the auction business. We’re asking that the portal crack down on abusers of the system that are costing other auctioneers operational fees in the long run.

And if your consignors demand high reserves, you should charge 5-10% for each item that fails to sell as a “buyback.”

We make these suggestions not on behalf of bidders but to maintain the tradition and excitement of auctions where lots can sell for multiples of retail … or multiples below wholesale. That has been the allure of the auction for decades onsite. It’s no different online.

Granted, it takes numismatic skill to discern which houses are charging retail for items. We just saw an opening bid of $900 for a common 1921-S Morgan dollar; that is beyond retail, especially when the house hypes the lot description and then proclaims that it is not responsible for grading.

To tell whether a slabbed coin is being sold at retail, input the certification number on the holdering company’s site. Here’s one for NGC. Here’s another for PCGS. Then add the buyer’s fee.

Here’s an example, a $20 Saint Gaudens with a retail of $5500 and a rejected bid of $4800. This house charges more than 15% buyer’s fee, but even with that, and the rejected bid at $4800, this coin is selling for shop retail prices–at the expense of other auctioneers on the portal.

Proxiblog is an independent entity with no connection to the auction portal Proxibid. Our intent is to uphold basic numismatic standards as established by the American Numismatic Association and the National Auctioneer Association and to ensure a pleasurable bidding experience not only on Proxibid but also on similar portals such as iCollector and AuctionZip.

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