If you know anything about auctioneering, you already understand that auctions are more than just being able to speak quickly in a room full of eager bidders. For an auction to be successful, you need weeks or even months of planning and marketing. By the time the first bid comes in, an auctioneer has already invested a lot of time and resources into making the event a success.
This naturally makes you wonder how such professionals make money. And if you have at any point wanted to try this career, this information matters all the more. So, here is how you’d make money after becoming an auctioneer.
1. Seller Commissions
Auctioneers make money primarily by earning a commission. The way this works is quite straightforward. The more profitable auctions you conduct, the more money you make. And this operates on a win-win basis, as you’ll typically earn a commission on total sales.
You, therefore, have to work your absolute best to make the most money for the items you are selling for your clients. The nature of this profession also motivates you to invest in top-rated auctioneer continuing education to ensure you are up to speed on the best practices in the industry.
It’s important to understand, however, that the commission rates vary depending on factors like the type of auction, expected sale value, local market competition, the individual client, and so on. Always work with a clearly outlined contract to guide you and your clients on the fees and expenses you should pay upfront, as well as the type and range of work you will do.
2. Buyers’ Premiums
A very common misconception among first-time bidders is that the winning bid is the only money they will pay if they win an item. That’s far from the truth, because there’s also a buyer’s premium. This is a standard fee that a buyer pays on top of the hammer price before any applicable taxes and shipping.
It’s typically presented as a percentage, which means that a 25% buyer’s premium brings the total price of an item won at $100 to $125 after the buyer’s premium is added. This fee is meant to cover the auctioneer’s operational and marketing expenses.
3. Marketing Fees
Sellers and other major stakeholders often overlook the fact that advertising an auction is usually expensive. Think professional photography, drone footage, social media campaigns, and so on. There is a lot you will have to do as an auctioneer to ensure that your target audience is well aware of any upcoming event.
But since expenses related to marketing can swell up pretty fast, auctioneers often have to charge sellers a marketing fee separately from their commission. Such an arrangement protects you from spending thousands of dollars promoting an auction whose revenue you can’t accurately predict. The marketing fees can be dynamic or fixed depending on a couple of factors.
4. Pre-Auction Services
This is one of the least understood ways for auctioneers to make money. Experienced auctioneers, especially, spend quite some time working away from the auction block. So, before an auction ever takes place, they may already be earning income by providing professional services, including asset valuations, estate consultations, and collection management.
There is a large assortment of pre-auction services that sellers need, depending on the market and situation. Besides, more complex estates or business liquidations require extensive planning, which often takes dozens of hours. Such behind-the-scenes work is often separated from commissions or quotations.
Ready to Earn From Your Passion
Auctioneers typically earn most of their money through commissions, but there are several other less obvious ways, as you have seen in this post. So, if you have always had a passion for auctioneering, the reality is that there will be more than one way to earn once you get started.
To get started in this career, however, it will be crucial that you take the right education. The best way to do this would be to invest in a top-rated training course like the ones RocketCert offers. So, make sure to visit rocketcert.com today to see more and get started.
