Will a Pay Now, Bid Later Approach Work for an Auctioneer?

by David Hewett

Pay now, bid later. That's the policy auctioneer Al Cardamone of Mooney's Auction Service in East Durham, New York, proposes to initiate. To make the offer attractive, he's offering to cut the 10% buyer's premium and give a $7 credit at the snack bar to all who sign up.

Here's part of the e-mail announcing the proposition Cardamone sent to his customers. We've corrected misspellings and adjusted syntax slightly where necessary, but otherwise it's as Cardamone pitched it:

Zero percent buyer's premium, what do you say to that? It's impossible, you say. No, it's true. If you are an active buyer here at Mooney's Auction and "prepay," Mooney's will charge you a 0% buyer's premium. That's right, no matter how you ask the question, the answer will still be no buyer's premium!

Times being as they are with the economy being as it is, we all have to be creative. Now it's true that if you were a bank, insurance company, or a lobbyist in Congress, our government would just write you out a check for $700,000,000.00 but?? So here we are, the little guy just trying to pay the bills and keep the family business going through the tough times, and God help us, we are doing our very best.

So here's the deal as simple as I can make it. By you prepaying for auction purchases you help Mooney's cash flow and in turn you have 10% less invested in your inventory, or, if you are a retail customer of Mooney's you have actually paid 10% less on your investment. There is NO, that's right, NO time-limit for purchases at Mooney's Auction. You will have an account set up with us and kept track of by a special buyer's number. You will also be issued a Mooney's preferred customer card which will entitle you to a $7 credit at the snack bar per auction you attend.

While we are making this offer, it will be first come, first served. We are capping the dollar amount at $125,000.00 with a minimum deposit in your pre-pay account of $1,000.00 and no maximum dollar amount. So in a sense you are receiving 10% interest on your money.

Late in November we spoke with Jonathan "Jonny" Cardamone, who works with his dad in the business. Had there been any responses to the prepay scheme?

"Well, yes, there have been a few, maybe seven to eight people who do enough buying here so that they are interested, plus some more at the under-five-thousand-dollar level," he said. "We have to work on the details more, like what would happen to the money if my father had to close the business before they used up all the money.

"My dad is thinking that maybe he could back it up with the mortgage to his house, or something like that."

His father has been in the auction business all his life, Jonny Cardamone said, with 11 years at their present location, and is a very honorable man, he added.

The $7 credit at the snack bar for every auction attended makes this one of the more unusual auction incentives we've encountered.

Login or Register to post a Comment