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Auction Listings Are Vital to the Success of Fundraising Auctions

Fundraising Auction Tip: You should always provide potential bidders with a printed Auction Listing of both your Live and Silent Auction items at any Fundraising Auction. A printed Auction Listing is vital for several reasons:

An Auction Listing informs bidders of the order of sale, and what is coming up next. If you keep your bidders guessing, they will simply not bid.

If bidders are not 100% certain of what they are bidding on, they will not bid. A printed Auction Listing should answer any and all questions about what is being sold in order to encourage bidders to bid as much as possible.

Bidders often need time to plan their bidding strategies, especially on multiple and/or larger value items. A printed Auction Listing helps them to do that.

Couples often need time to consult with each other about what they are willing to spend on something. A printed Auction Listing helps them to do that.

Potential bidders need to know the specifics, the benefits, and the restrictions on any item they are going to bid on, especially on travel and/or other higher value items. A printed Auction Listing should answer all of their questions, in writing.

After bidders see that they have lost an item to another bidder, a printed Auction Listing makes it easier for them to re-strategize on what else they can bid on.
Printed Auction Listings generally come in 3 forms:

Printed in the Event Program or Auction Catalog.

Printed on loose sheets of paper and hand-inserted into the Event Program or Auction Catalog.

Printed on loose sheets of paper and hand-delivered to all attendees, or left on each dinner table in the room.
Auction Listings cost practically nothing to produce and they can make the difference between the success and failure of a Live and Silent Auction. You should never conduct a Fundraising Auction without one.

A Case Study

Let me share a real-life experience with you. Once I was hired to conduct a Fundraising Auction for a nationally renowned organization. The event was held in a major hotel, in one of the country’s largest cities, with several hundred “black tie” participants attending. It was an extremely professional event, with the music, singing, lighting, speeches, and awards all perfectly timed and choreographed. Everything was done to perfection… exception the Fundraising Auction.

Although I had signed an agreement to serve as their Auctioneer nearly one year in advance of the event, no one bothered to contact me for any advice or help. Approximately one week prior to the Auction date, I contacted the group to see if they had replaced me with another Auctioneer. But they said that I was still their man.

Upon arriving at the event I asked for a copy of the Auction Listing. I was told that there were none. I’m not sure whether they felt that the Auction Listing wasn’t necessary, or whether someone forgot to have them printed. This was never made clear. When I asked what I was to use at the podium, I was told to copy the list of Live Auction items from a committee member’s computer. It took me about 30 minutes to copy three pages of hand-written notes in order to prepare for my role as their Auctioneer.

I knew that they had created a PowerPoint program showing the various Live Auction items. When I asked whether the PowerPoint slide order corresponded to the order of sale I had copied from the committee member’s computer, I was met with a blank stare. The committee member left to check the slide order, and returned to let me know that the slide order did not correspond my notes, and he provided me with the correct slide order… hand-written on a paper napkin. This forced me to re-arrange my three pages of hand-written notes before taking the podium.

There was a Live Auction Table with descriptions of the Live Auction items that were to be sold, but the table was not clearly marked, and it received significantly less attention than the Silent Auction Tables, which were clearly identified. Since the Live Auction Table was located adjacent to the “Raffle Table”, it appeared that most people thought it was part of the raffle and therefore paid very little attention to it.

According to the event program (which did not include an Auction Listing), I knew approximately when I was to begin the Live Auction. At the designated time the Master of Ceremonies announced the start of the Live Auction to the several hundred people in attendance, and introduced me as Auctioneer. As I approached the podium I realized that photographs of award winners were still being taken… directly in front of the podium where I was to stand… which required me to stand aside for several minutes until the photographers were done. Can we say “awkward moment”?

As the photographers cleared, I approached the podium and began my Live Auction introduction. Approximately one minute into my introduction, the “Raffle Committee” approached the podium and stopped my Live Auction Introduction in order to pull the 8 or 9 Raffle Winners. These drawings lasted about 5 minutes. Upon it’s conclusion I was allowed to resume the start of the Live Auction.

When standing at the podium two intense and extremely bright spotlights were pointed directly at the podium. The lights were so bright that I literally could not see the center 1/3 of the room. I could see the tables on the right, and on the left, but was totally blinded when looking straight ahead. It took perhaps five minutes before the spotlights were turned off.

While at the podium and describing Lot #1, I had to ask someone to start the Lot #1 PowerPoint Slide… because apparently no one was assigned that job.

So with only the Auctioneer’s verbal description, and a PowerPoint slide, it appeared that few people in the room had any idea about what we were selling… or when we were selling it… until it was announced by the Auctioneer. As a result, bidding was extremely light and the final results fell several thousands of dollars short of where they should have been
The learning experience is this:

The Live Auction is where you place your better items, and where the real money should be made at any Fundraising Auction. Let bidders know as far in advance as possible what you will be selling, and the order of sale, so they can get excited about the Auction, and plan their bidding strategy accordingly.

Auction Listings are absolutely vital to the success of both Live & Silent Auctions. In my opinion, revenues at this Auction fell thousands of dollars short of where they should have been, because no Auction Listing was provided to the guests.

If bidders are not perfectly clear on what is being sold, including both the item’s specifics, benefits, and restrictions, they will not bid.

When you have a committee of volunteers, especially volunteers having full time jobs and/or very busy schedules, the services of a professional Fundraising Auctioneer can help to keep the committee on track.

And once you retain the services of a professional Fundraising Auctioneer… use the services that you are paying for.

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Hiring An Auction Company

Estimating your assets value:

Typically, one of the first questions a business owner will ask me is, “how much will the assets bring at an auction”. After taking the time to review the assets, the auctioneer should give the client a conservative estimate of the sale based upon his experience and the current market trends. It is important that the company give realistic expectations so the seller can make informed decisions based on their best interest.

Compensation and Expenses:

Is the company you are considering working for you or against you? The agreement you decide may determine this.

A business owner should carefully consider how the auction company is compensated. The most common commission structures include: straight commission, outright purchase of assets, guaranteed base with a split above to both auctioneer and seller, guaranteed base with anything above going to auctioneer or a flat fee structure.

In a straight commission structure, the company is paid an agreed upon percentage of the total sale.

In an outright purchase agreement, the auctioneer simply becomes your end buyer. The company purchases your assets and relocates them. While this can be an option in some unique situations, keep in mind that they will want to purchase your assets at a very reduced price to make a profit at a later date.

In a minimum base guarantee, the auction company guarantees the seller that the auction will generate a minimum amount of sales. Anything above that amount either goes to the auction company or split with the seller. While a seller might feel more comfortable doing an auction knowing that he is guaranteed a minimum amount for his sale, keep in mind that it is the best interest of the auction company to secure a minimum base price as low as possible in order reduce their financial liability to the seller and secure higher compensation for the sale.

In a flat fee structure, the auctioneer agrees to show up for the sale and call the auction. There is no incentive for the auctioneer to get the best prices for your assets. The auction company is compensated regardless of the outcome of your sale.

What is the best option for business owners? In my experience, an agreed upon straight commission structure. This puts the responsibility on the auction company to offer the best outcome for everyone involved. There is an incentive for the auction company to work hard for both parties, set up and run a professional sale, get the highest bid and sell every item on the inventory. Successful auctions translate to a higher bottom line for both the seller and the auction company.

Auction Expenses:

In most auction agreements the expenses to conduct an auction are passed to the seller. If the auction company pays for the expenses, it is simply absorbed in higher commission rates.

All expenses should be agreed upon in advance in a written contract. Typical expenses will include the costs of advertising, labor, legal fees, travel, equipment rentals, security, postage and printing. A reputable auction company will be able to estimate all expenses based upon their experience in previous auctions. An agreement should be actual costs charged as expenses, not an estimated amount.

Advertising is typically the highest cost in conducting an auction. The auction company needs to set up an advertising campaign that will promote the sale to its best advantage and not overspend to simply advertise the auction company.

Once the auction is complete, the auction company should provide a complete breakdown of all expenses to the seller, including copies of receipts within the auction summary report.

Buyer’s Premium:

What is a buyer’s premium? If you attend auctions regularly, you are very familiar with this term. The auction company charges a fee to the buyer when they buy an item at auction.

The buyer’s premium has been around since the 1980′s and is standard auction practice. It was first used by auction houses to help offset costs of running brick and mortar permanent auction facilities. Since then, it has spread to all aspects of the auction industry. It is prominent in online auctions and allows auction companies to cover added expenses incurred from online sales.

It is the responsibility of the auction company to provide clear disclosure of the buyer’s premium to both the buyers and the sellers. Those not familiar with auctions are often taken back by the buyer’s premium. They looked upon it as an under handed way for the auction company to make more money. Reputable auction companies will provide full disclosure within the auction contract, advertisement and bidder registration.

Typically, an auction company will charge online buyers a higher buyer’s premium percentage than those attending an auction in person. Extra fees are incurred with online bidding and are charged accordingly to online buyers. This provides the seller a level playing field for both online buyers and those attending the auction in person. Without the buyer’s premium, there is no way to do this.

Pre-Sales:

We’ve all been there. We’re looking forward to attending an auction only to find that some items were sold prior to the auction date.

As an auctioneer with over thirty-six years of experience, I can honestly state that pre-sales will hurt an auction. When a company decides to liquidate their assets, it is easy to sell off high-end pieces of equipment through online sources, equipment vendors or to other businesses. The seller receives instant cash and avoids paying a commission to an auction company.

Auctioneer’s find themselves appearing to acting in a self-serving capacity when potential clients say they are planning to sell off parts of their inventory prior to an auction. It’s hard not to consider the auctioneer’s commission when they warn you not to pre-sell anything. Yes, the auctioneer wants to earn a commission on those sales but it is more important that the auctioneer protect the sale from potential negative backlash that comes from pre-selling. The buying public knows when an auction has been “cherry picked” prior to the sale and it reflects in their bidding. It becomes a sale of “leftovers” and that impacts prices.

A buyer who purchases prior to the auction usually does not attend the sale. They already bought equipment at a good price with no competition. If they do attend the auction, they tend to let others know of their great pre-sale purchases which again, impacts prices and the overall excitement of the sale.

It is important to understand that auctions work best with a complete inventory. You want competition on your higher end equipment. The easy to sell items make it possible to gain respectable prices for hard to sell items.

When a business owner decides to liquidate their equipment assets, there is only one opportunity to do it right. Hiring a reputable auction company will assist you with a professional, orderly and timely liquidation.

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Top Ten Small Business Mastermind Advisers All Small Business Owners Need To Have to Succeed

The statistics on small businesses going broke in the first 12 months of operation are nothing short of obscene and seriously scary. In Australia and other western countries such as the United States 70% of all small businesses fail within the first 12 months of operation but let me tell you from experience, surviving after that 12 months is no less harrowing.After 10 years of running four small businesses and creating them from scratch I can tell you with some authority, that I did not do this on my own. In fact, I reckon I have made every mistake in the book on how not to run a small business, but yet I have still survived. The secret to staying in business is all down to being able to talk to my ten Small Business Mastermind Advisers.My ten Small Business Mastermind Advisers are there as my support team in helping me make the right decisions. See often when we make a decision in small business, it might be right at the time but down the track it can do you a lot of harm. Having your small business mastermind advisers on call, you can simply call them and ask them the consequences of the choices you are about to make.For example, having the right business structure and putting your business assets in the right structure will play a major roll in the success of your business when you decide to exit the business. Se e most people who go into business only ever think of the business as a job they do not look at it from the perspective of how they will exit the business when they have built it into an enterprise.Those ten small business mastermind advisers will help you to ensure that you have met your obligations and that there are no hidden issues that might come up in the future for your business. For example, we recently chose to sell off our car cleaning business as my wife wanted to pursue something different. Because of the way I had structured some of the trademarks in my company that related to hers, when we went and sold the business it created a number of headaches in the sale process. Essentially we had to shift ownership of those trademarks to her company prior to the sale which created a number of financial costs that we have had to endure even though my company never made any money. This issue arose simply because in the early days, I did not have my 10 Small Business Mastermind Advisers to tell me how my choices would impact on me in the future.Adviser 1: AccountantIn business today, with the complexities of superannuation, sales tax or GST, income tax and all the other taxes out there an accountant is a must. As a small business owner you need to find an accountant that is a small business specialist and is proactive in working with you.What I have found is that some accountants will only do what you ask them to do and will not step in and give you advice if you do not ask. You want an accountant that if they see you are doing something wrong then they will tell you without you asking.The other thing you will need to ensure is that you hire an accountant that outlines where all of their hours are going. It is very easy for you with accountants and solicitors to end up with 5 or 6 figure bills.Adviser 2: SolicitorThe solicitor is another important Small Business Mastermind adviser. Just like the accountant you need to make sure that the solicitor is a small business specialist. The role of the solicitor is to help you with all legal issues like what structure suits what you want to achieve, do your forms and policies meet your legal obligations, like your privacy policy, recruitment policy etc.They can also help you protect your assets and in particular your intellectual property like trademarks, copyright etc. Often small business owners do not do the basics of trademarking their business name and logos to stop other business predators using their identities.Adviser 3: Marketing and Advertising ExpertA Marketing and Advertising Expert is a must in today’s market place. I have found that with the various media types, people in the industry can get better deals than if you dealt with the media owners. For example, recently I chose a new advertising specialist to join my small business mastermind advisers because their company was able to negotiate lower television advert placements, than what I could dealing directly with the station.Your marketing and advertising expert should have some experience in your industry and be able to show real statistics of adverts and marketing campaigns that actually achieved results. More so, they should also have a mantra of test and measure to ensure that your campaigns are giving you value for money and more so, are making you a profit.Adviser 4: BookkeeperSome accountants have their own bookkeepers, but I have found that quite often they are more expensive than bookkeepers not tied into an accountant. Further to this you should always check to make sure the bookkeeper is certified. In some countries, including Australia, bookkeepers can be certified through the National Bookkeepers association or the CPA.Your bookkeeper must be prepared to work with your accountant and if they have questions you must give them permission to speak with your accountant and more so, you need to make sure that they document all communications with your accountant.Remember one thing, it does not matter whether your Bookkeeper or your accountant makes a mistake, ultimately, you as the business owner are responsible for your books. If they get it wrong, it will be on your head, so always make sure that you understand what they are doing.Adviser 5: IT PersonEverybody hates computers and I am a 20 year veteran of the industry and I still hate them. Having a good IT person is essential. Most businesses today are now totally reliant on their IT Technology and if your technology goes down, the question you need to ask is, “could your business still operate?” If the answer is no, then you need to hire an IT person who will be there in an emergency.When choosing an IT Person or company make sure they are qualified in the technology you are using. For example, if you are using Microsoft Windows technology in your office, then your IT Person should have at the very least the Microsoft Certified Desktop Support Technician qualification.Adviser 6: Website and Search Engine ExpertIf your business is not on the web and you are not selling products to the global market then you are making your life incredibly difficult and you are missing out on lots of opportunities. The internet is a fantastic tool for doing business but be warned there are lots of crooks out there, especially in the search engine optimization industry.Before choosing a web builder and search engine expert ask to speak with some of their existing clients or talk to other business associates and find out who they use. I will say you should expect to pay anywhere between $1,500 to $5,000 per month for this service depending on your business and what sort of income you want to derive from the internet.Adviser 7: Business CoachBusiness Coaches, are like website and search engine experts, there are a lot of snakes out there who have no real small business experience. Before choosing a Business Coach ask them if they have ever owned a small business or if they had been a principle small business manager.If you have been in small business for a while, then it will be very obvious to you as to which business coaches have owned businesses before going into business coaching. Their approach will tend to be more practical then something out of a book. Once again before choosing a business coach, talk to your business colleagues and see if they can recommend someone.Adviser 8: Financial PlannerManaging your money is a major issue and most accountants will not give you Financial Planning Advice. A good financial planner will be able to help you where to put your business money, to get good growth but also to be easily accessible.You should also have a good financial planner for your personal 401k or superannuation policy but also if you are managing an employer superannuation program. Most small business owners forget to build their own 401k or superannuation policy as they are building their business and when they get to selling their business they find they do not have enough to live on once they retire because once the business debts are paid off, nothing is left.Adviser 9: Business BankerFinding the right bank and right business banker is essential to succeeding in business. You definitely need to build a constructive relationship with your business banker as they will be your life line in a dire cashflow situation or if you need money for a deal you just could not let go by.Business Bankers can also help you with other issues like leasing and hire purchase accounts, but also other facilities like merchant facilities, sales tax bank accounts etc.Adviser 10: Insurance BrokerI learned the hard way on how important an insurance broker is to your business. The previous insurance company I dealt with did not advise me that none of the glass in my building was covered if I was broken into. I have extensive insurance, but because Glass was an optional extra, the previous insurance company did not tell me this and when we were broken into, even though I pay over $5,000 per year in insurance, I still had a $4,000 bill for all the glass damaged during a break and enter.This particular experience really drove home, how a good insurance broker, whilst upfront might cost you more, in the future will save you more.Just like any employee when you are putting together your Small Business Mastermind Advisers you need to interview each adviser and ensure that you are able to work with them. Further to this, to get the best advice from your Small Business Mastermind Advisers you must be 100% honest and open with them, even when things are looking dire. If you are not totally honest, then they cannot give you the advice that will help you get out of trouble.

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