Reserves

Simply put, we aren’t big fans of adding reserves or putting a starting bid higher than $1 on our auctions.
 
Generally speaking, items with reserves or set opening bids tend to underperform in auction results. Seems counter-intuitive, right? Reserves tend to dampen bidder excitement. Whether the reserve is disclosed or not, it takes the fun out of the auction process. The auction format truly reflects the current market. Items of higher quality will attract interested buyers. More interested buyers mean higher bids. It’s that simple!
 

Reserve Basics

  1. We will not put a reserve for anything less than $5,000. There are no exceptions to this rule.
  2. The reserve fee – $150 – is payable by cash or check before the item is listed on the auction.
  3. The reserve fee is NON-REFUNDABLE.
  4. Assets that sell with a reserve will be charged a 5% commission in addition to the reserve fee.
  5. If an item doesn’t sell with a reserve the first time, we can re-run it without a reserve.
  6. We will NOT contact the high bidder of an auction that doesn’t reach the reserve to see if they want to buy it for their highest bid. This undermines the auction process.
  7. We will NOT provide the high bidder’s contact information to the seller of an item listed with a reserve. We take our customers’ privacy seriously and will not disclose their personal information.
Scenario 1 – You DO put a Reserve on a Vehicle:

You bring over a car that has a market value of between $7,000-8,000.00 and you want to put a $7,000.00 reserve on it. Our commission fee would be 5%, or $350. The reserve fee due before leaving the warehouse would be $150. That would set the reserve price at $7,500.00 to ensure you get your $7,000.00 when the auction ends.

Thinking from the buyer’s perspective, they still need to pay state taxes and fees in addition to the buyer’s premium. All in all, they’ll be paying well over $8,500 for something that has a market value between $7,000 to $8,000. The likelihood of it making the reserve price is very slim. The $150 reserve fee is non-refundable, so you’re out $150 and you still have the car you need to sell.
 
Scenario 2 – You DON’T put a Reserve on a Vehicle:

You bring over a car that has a market value of between $7,000-8,000.00. We don’t set a reserve price.

The auction reaches $6,800.00. The buyer pays tax, title, license, buyer’s premium, and documentation fee, in addition to the hammer price – around $7,500. Since we’re motor vehicle dealers within the state of Minnesota, we take care of all the paperwork and ensure it’s transferred at the DMV. You would receive a check for $6,800 since anything over $3,000.00 without a reserve doesn’t get charged a commission.

While you may not get the $7,000 you were hoping for, the car goes to its new owner, you don’t have to deal with the public when selling on Marketplace/Craigslist, and you don’t need to worry about whether or not the paperwork was transferred.

While the scenarios shown here are fictional, this is a general example of how reserve vs. non-reserve auctions work.

Reserve Fees