Adding Online Auctions to an Estate Sale Business: A Guide

When an online auction beats a tag sale

An online auction suits an estate whose value sits in specific things rather than in volume, and a tag sale suits the reverse. If the house holds a few hundred items that particular bidders would drive an hour for, a coin collection, a workshop of good machinery, signed art, marked mid-century furniture, the auction puts each of them in front of every bidder in the region rather than whoever reached the front of a line on Friday. If the house holds three thousand ordinary things that need a crowd to carry them out, the auction spends a week of cataloging on lots worth less than the time it took to photograph them.

Circumstances push a sale toward the auction too: a family out of state who wants the house quiet until one pickup day, a building where a crowd is not permitted, a family uneasy about strangers in every room, or no crew free for three sale days but one person who can catalog for a week. The guide to estate sale vs. auction lays out the family's side of the choice; what follows is how it looks from behind the counter.

Many companies run both, and some run a hybrid: the headline lots close in an online auction the week before, and the rest sells in a tag sale on the weekend, with the auction's pickup folded into the sale's first morning. The contract has to say which items go which way.

Choosing an auction platform

You will run your auctions on somebody else's software, and the platform you pick shapes the bidders you reach, the fees you pay and the hours you spend. Their terms change often enough that this guide will not name or rank them. Compare them on these points:

• Who bids there. A platform is worth its fee for the bidders it already has in your region. Look at closed estate auctions within fifty miles: how many bidders, what ordinary lots brought. A national bidder base with nobody in your county is a poor fit for furniture nobody will ship.
• Fees, and who pays them. Some charge you a percentage of the hammer, some a listing fee per auction, some a share of the buyer's premium. Get the schedule in writing and work out the cost on a real auction of two hundred lots.
• Payment processing. Whether the platform charges winning bidders' cards for you, what that costs, and when it pays you out. Taking payment yourself on pickup day turns the day into a checkout.
• Cataloging tools. A phone app that lets you photograph, describe and number a lot in one motion saves hours over uploading from a laptop that evening.
• The closing mechanism. Most platforms close lots in sequence with a soft close, extending a lot's clock when a bid arrives in its final minutes. Confirm how it works, because bidders ask; the guide to bidding at an online estate auction is what they will have read.
• Your data, and support. Whether you can export your bidder list, and whether somebody answers at nine on a Thursday evening when a bidder cannot log in.

Run two or three auctions on one platform before judging it; a bidder base takes a few auctions to notice you.

Cataloging: where the labor goes

In a tag sale, pricing is the labor. In an auction, cataloging is, and it is easy to underestimate. Every lot needs a number, photographs, a description and a condition note, and a full house is one hundred to several hundred lots. A trained person with a phone app can catalog perhaps sixty to a hundred lots in a day, fewer when each one is individually valuable.

How you lot the house decides how it sells. One good item gets its own lot, and everything else is grouped so that the lot is worth a bidder's drive. A box of kitchen utensils as one lot will find a buyer; the same utensils as forty lots will not, and each unsold lot is a photograph you paid for. Group by what a buyer would want together rather than by what happens to share a room.

Photographs are the whole sale, because nobody handles the item before bidding. Shoot each lot from two angles and close on any mark, signature, label or damage. Photograph the damage more carefully than the good side: a bidder who finds a chip you did not show is a refund, and a bidder who saw the chip and bid anyway is a sale. Descriptions state what the item is, its measurements, the maker if known and the condition in plain words; do not attribute a piece to a maker you have not confirmed. The advice in the guide to photos and listings that draw buyers applies lot by lot.

Decide whether to run the auction from the house, which means your lots occupy it for two or three weeks with the family's agreement, or from your own space, which costs a truck and a day and suits a small estate.

Buyer's premiums, commission and the contract

An auction is paid for from two directions. Your seller's commission is a percentage of the hammer prices, deducted before the family is paid, as at a tag sale; rates vary by region and by estate, commonly somewhere between roughly a third and a half of gross. The buyer's premium is a percentage added to each winning bid and paid by the bidder to you. Bidders bid a little lower to allow for it, so part of it comes out of the hammer price, but it is income a tag sale does not have, and it is why an auction company can sometimes quote the family a lower commission.

Be plain with the family about the premium. State it, state your commission, and show what the estate receives on three possible totals; the family will see hammer prices on the platform and needs to understand why the settlement is a different number. The advice in the guide to commission rates about being recalculable applies twice over here.

The guide to what to put in your estate sale contract covers the common clauses; for an auction, add:

Bidders expect lots to sell to the highest bidder, and an auction full of unmet reserves teaches them not to bother with your next one. If a family has one piece they will not let go under a figure, set that reserve and say so; sell everything else absolute.

Running the bidding window

A window of seven to fourteen days is usual: shorter does not give word time to spread, longer and the early bidders lose interest. Set the close for a weekday evening, with lots closing a short interval apart in catalog order, so a bidder who loses one lot can move to the next.

Promote the auction to your own bidder list first, then the listing sites you already use, then the specialist groups for whatever the headline lots are. A sale listed on this site can carry a Bid now link to your auction, so a shopper searching for sales near them lands on your page and is one tap from the catalog. Listing here is free with no listing fee, and the street address is shown on a schedule rather than immediately, which for an auction you may want set to shortly before pickup day.

During the window, somebody has to answer questions. Bidders ask for measurements, another photograph of a mark, whether a piece is solid or veneer, and answering within hours turns a hesitant bidder into a bid. A staffed preview afternoon for the higher-value lots lets serious bidders handle what they are about to spend real money on and cuts the disputes on pickup day. Closing night is when most of the money arrives; be at a screen, with the platform's support number to hand.

Pickup day

Pickup day is where an online auction is won or lost as a business, because it is the only part the winners experience in person. A well-run pickup takes a winner from the curb to their car in a few minutes; a badly run one has forty people in a driveway while a staff member searches a bedroom for lot 212.

1. Stage the lots by number before anyone arrives. The evening before, move every sold lot to a numbered position in the garage or the largest room. Nothing is collected from where it was photographed.
2. Check invoices at a single door. One staff member matches the winner to the paid invoice and hands them a slip listing their lot numbers. Nobody enters without that step, and nobody leaves by another door.
3. Runners find the lots; winners do not wander. A staff member brings the numbered lots to the door or walks the winner to them. The house is not open for browsing.
4. Winners bring their own help and packing. Say so on every listing and in the invoice email. You provide a hand truck and a hand on the steps; you do not load trucks or disassemble furniture.
5. Set a window, and a second one for the heavy lots. Six hours on a Saturday with a short window on Sunday morning covers nearly everyone. Say what happens to lots not collected by then.

Some winners will not come; your terms should say whether you offer the lot to the underbidder, resell it, or treat it as abandoned. Some will dispute condition; your photographs and notes are your whole defense, and the cheapest resolution is usually a refund on that lot. The guide to liability and safety applies to pickup day as much as to a sale: a winner carrying a sideboard down porch steps is exactly when an injury happens.

Licensing, insurance and sales tax

Whether running an online auction needs a license depends on the state, and this is not legal advice. Some states license auctioneers and apply that license to auctions conducted online, some exempt online-only auctions, and some have no auctioneer license at all. The answer is on your state's business regulator's site, and the licensing pages here, for example the one for Texas, are a starting point. Check before your first auction, and ask an attorney if the rule is unclear. The guide to licensing and insurance for an estate sale business covers the general picture.

Tell your insurer that you are running auctions. Lots stored in a house for two weeks and a pickup day with the public carrying furniture are exposures a policy written for tag sales may not describe. Sales tax generally applies to auction sales as it does to sales in the house, and the platform may or may not collect it for you; confirm which, and ask a tax professional, because rules vary by state.

What to do next

Pick one estate that clearly suits an auction, a workshop, a collection, a house whose family lives away, and run it first, with a modest lot count and a pickup day you can staff generously. Keep the numbers: cataloging hours, lots sold, bidder count, what pickup cost you. When you list your company free here, every sale you post can carry a Bid now link to the auction, families who describe an estate once can reach you, and there is no per-lead charge and no card needed. The guide to online estate auctions for families is worth sending a family before the walk-through.

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