This week one of our Honor Roll auctioneers wrote: “Next let’s start looking at under bidders, you know, the guys that bid 50 cent on every item.” What’s up with them, and do they ever win any lots?
Proxiblog patronizes many online auctions and conducts our own onsite auctions locally on occasion. So we do understand many of the issues involved in auctioneering, from both the bidder’s and seller’s perspective. But one thing that seldom happens in an onsite auction is the presence of the “Underbidder,” yelling “50 cents!” every time a lot comes on the block.
The Underbidder is omnipresent on Proxibid, however.
One variant of this Proxibum bids $11 on Morgans because he can hit the 1 on the keyboard twice, surpass most opening bids and file the bid quicker than striking a 1 and a 0 for $10, which he would do, did it not waste so much keyboard time. Filing bids is what this guy does best, hundreds of them (if not thousands) across the portal each day.
He figures if he wins a cull or damaged silver dollar at $11, the silver alone might be worth close to $30, so he’s potentially tripling his profit at everyone’s expense–the auctioneer, the portal and other bidders. But some Underbidders even go as low as 50 cents on every item. Do they ever win any lots?
Recently one of our favorite top auction houses made the decision to list every lot at $5, rather than using high opening bids. Of course he was hit by Underbidders. As his house went overnight from high to low opening bids, Proxiblog was worried that the company would be low-balled back to steep opening bids if something wasn’t done on his behalf.
So we bid every one of his 250 lots at Grey Sheet wholesale, what a coin dealer would pay. The entire auction. We found the Underbidder at $5 in each lot, for Carson City Morgans to rare coins and precious metals worth hundreds of dollars.
As it turned out, the company’s consignment was so strong that the auctioneer’s low-opening bid action generated sales above wholesale and even retail for most of his lots. And within two other auctions, he had established a return-bidder contingent so reliable that now Proxiblog has trouble winning any lot at wholesale. That’s what competition does, and that’s why we advocate it as we did in the last post about maximum bid viewing.
But this is the extent of our knowledge about the Underbidder roaming Proxibid. We’re wondering whether any auctioneer reading this has ever sold a Morgan worth $30 in silver weight for $11. We wonder whether Underbidders ever correspond with auctioneers about their deceptive game. Perhaps an auctioneer reading about this special brand of Proxibum has an anecdote to share.
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.
I was not aware of this practice and will never use it. I win a few and lose a few on each auction, I bid what I think the coin is worth, also considering the surcharge and handling fees. For some auctions these are quite high considering that I rarely win more than two lots and usually only bid on 5 or 6 in any auction. When the surcharge is 15% and shipping is $8 or more I have to consider my bid carefully
Thank you, Dick. I do what you do, basically. My main goal is to raise scholarship and college money, buying and selling. But occasionally I’ll want a coin. I factor in all the variables and go 10% above Grey Sheet. I win one coin for every 10 I bid on in this manner. We appreciate your comments!
Starting bids are always a concern for our sellers, I have to remind them that it is not the opening bid but the closing or winning bid that is only what’s important. At Krause Auctioneering we start every items at $1.00 regardless of its value:: coin value or smelt.
On somewhat of a related issue, PROXIBID has changed their listing fees, for some sellers it may change what price they start the items for. Also, do to the electronc footprint with online auctions, PROXIBID has given fair warning to the auction companies that “no’ employee, seller or agent for the seller can bid unless a ‘statement’ from PROXIBID is posted on their auctions.For bidders, this will help to take away the ‘schil’ bidding done by some auction componies or their sellers. PROXIBID does have the tools to track this type of bidding. If you know a seller is biiding on his own items or the auction company omitts they do,you can report to them to PROXIBID for investagation.
This is a positive step for the online auction community, not so good for those who have taken advantage of you over the years. By the way, with conventional auctions it is also illegal for the seller or auction company to bid, just harder to prove.
Thank you so much, Ron, for sharing your expertise and perspective. You enrich these posts, and our viewers appreciate your knowledge and advice. Perhaps others will follow your lead and enlighten us about some of the issues you address in your comment. You make valid points!