The Vendor Bid VS The Reserve on Auction Day

The vendor bid and the reserve have 2 very different purposes on auction day.

Vendor bid

  • The vendor bid is primarily used to encourage bidding, whether at the start, middle or at the end of an auction
  • The vendor bid is not compulsory
  • Vendors have the right to use 1 vendor bid and the auctioneer must declare this prior to the start of the auction
  • The vendor bid should be an amount less than the reserve
  • The auctioneer announces the vendor bid on behalf of the vendor

The Reserve

  • The reserve is the amount the vendor is willing to sell for on auction day
  • The reserve must be in writing and must be given to the auctioneer prior to the commencement of the auction
  • The reserve is confidential
  • The reserve is compulsory, ie no reserve, no auction

In Summary:

The main differences between these 2 amounts is that the reserve is compulsory and an essential part of an auction process while the vendor bid is a helpful tool designed to kick off an auction or assist in helping an auction move forward to a sale under the hammer.

Part 1: Auction Vs Private Treaty?

Part 2: The Vendor Bid

Part 3: How Much Is An Auctioneer?

Part 4: On-site Vs In-Room Auction?

Part 5: Does an Auction Marketing Campaign Cost More?

Part 6: A Bidders Guide For Auction Day

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