Why Are Government Auctions So Special?
We have mentioned the words NO RESERVE or Unreserved on several occasions but what is the difference between these and conventional auctions. The very simple answer are the words NO RESERVE. Vendors who sell goods via a general auction will be looking to get the maximum return possible for their goods and will have a limit to which they will not go below – their reserve price. This is set before the goods are even put up for sale and it is the auctioneer’s job to get as close to the reserve as possible and anything over that price is a bonus. The problem for the auction house is that they make their money on commission – a percentage of what the stock sells for – If they do not get the reserve bid then the client will not sell the goods. They would rather take the stock away and try again another day. The point is that it can sometimes be more difficult to get a bargain at a general auction. The reserve price is set at the ‘highest point’ the seller ‘thinks’ they can get away with and
