Auctions offer many collector opportunities
By Michael Baadke
This week in Refresher Course, we welcome guest columnist Michael Rogers, a name familiar to Linn's readers who see his Asia column in our pages once each month.
|Figure 1. A selection of public and mail auction catalogs.|
|Figure 2. Each item offered through the auction is described in the catalog. Some items may be pictured. Click on image to enlarge.|
|Figure 3. Auction rules and instructions provide essential information for the prospective bidder. Click on image to enlarge.|
Rogers is also the proprietor of Michael Rogers Inc., a Winter Park, Fla., auction house dealing primarily in Asian philately.
With this guest column, Rogers provides a collector's introduction to stamp auctions, including keys to successful bidding, potential hazards and the basic rules of the game.
By Michael Rogers
Linn's readers frequently encounter advertisements and articles about public stamp auctions and mail sales, held by a variety of companies in mundane and exotic places.
These locations vary from New York to Hong Kong, to little out-of-the-way places, such as Winter Park, Fla.
No matter where these auctions take place, they all have one thing in common: They are trying to sell stamps and covers to collectors or dealers.
Stamps sold at auctions can vary in value from $5 or $10 to hundreds of thousands of dollars.
Ideally, auctions are a good source for more expensive or more unusual stamps and postal history.
For collectors, the auction may provide an opportunity to save money on higher-priced items.
Say a stamp dealer has an unused example of China Scott 56, which the 1999 Scott Standard Postage Stamp Catalogue values at $1,500.
The dealer wants $1,200, but you note another China Scott 56 offered at auction. Bid no more than $900, and you might be likely to obtain the stamp, saving hundreds of dollars.
However, if multiple bidders really want the same item, the realization can be far higher than the price any dealer would expect to sell it for.
A hinged set of Hong Kong Scott 185-98 recently sold at auction for $322, while almost any dealer would have been content selling it for half that figure.
Before one can participate in an auction, some studying is required.
All auctions have catalogs that describe and often picture the material for sale. Figure 1 shows a few recent catalogs.
One page from a recent auction catalog is shown in Figure 2.
For most sales, especially prestigious ones, there is a fee charged to acquire a catalog.
This is not unreasonable, as the production and mailing of catalogs constitute a substantial expense. Still, for a large number of smaller auctions, there is no charge for the catalog all you have to do is request it.
There are two types of auctions mail sales and public.
Mail sales work just as you might guess. Bids, depending on the company, are accepted by practically any written form of communication, such as the bid sheet supplied in the catalog, a letter, e-mail or fax, and in some cases by phone.
A public auction allows a combination of bids, either written, phoned or offered in person while the auction is underway.
The first thing anyone must do with an unfamiliar auction is to very carefully read the auction rules or instructions printed in the catalog. Not all auctions are run in the same manner, and variations can be confusing.
The rules printed in one recent auction catalog are shown in Figure 3.
Some auctions are run by awarding the lot to the winning bidder at one increment over the next highest bid.
In other words, if you were to bid $100 for an item and the next highest bidder bid $50, you would win the item for one increment over the $50 bid.
Each auction bid must be placed using the increments listed in the catalog.
For example, to bid on an item with a value of $30 or less, the catalog may say the bidding increment is $1.
That means each bid must be in $1 multiples. You can't bid $28.50: You must bid $28 or $29.
In another type of sale, the amount you bid is the amount you will pay, if yours is the winning bid, regardless of what else is bid.
The catalog will also tell you if there is a buyer's premium added to the final sale price, and what that premium is. Usually this added cost is a percentage of the successful bid price, such as 10 percent or 15 percent.
Some auction houses sell "as is." If you bid and you bought it, you own it. Period.
"No return" means the buyer has no recourse.
Most auctions have time limits on returns, even if the item they offered in good faith turns out to be misidentified or counterfeit.
Shortly after the sale, the auction house has to pay the owner of the lots that are sold, so timeliness on the part of the buyers is important.
As a buyer, you have the right to send a purchase to an expertizing body. When you send a stamp or cover for expertizing, it needs to be done with the knowledge of the auction firm. The firm must be notified of the pending expertization prior to the auction's deadline for doing so. If you fail to notify the firm in a timely manner, you forfeit your right to return the item if it is proved to be counterfeit or incorrectly described.
Almost all auctions have a no-return policy on lots of 10 items or more. This is done to prevent switching. Most auction houses have a photo record of individual stamps, but it is not practical to photocopy entire collections.
It is also impractical for the auction house to inspect every stamp contained in a collection, so you have to assume that some may be of lesser quality or damaged.
Once you have the auction catalog in your hands, it is time to make some decisions. If you are like most people who collect stamps, your eyes are much bigger than your wallet.
Some tough decisions have to be made: What will your budget bear? And how much are you willing to pay for that particular stamp you've been wanting for months or years?
Most auction houses will assist you in this struggle by providing current opening bids for the lots that you are interested in. The purpose for doing this is to let you know whether what you are thinking of bidding is realistic.
Some auction houses will let you do postal viewing, and some will not. For those who will, here is how it works.
You tell the auction house which lots you would like to examine. They mail them to you, usually via Express Mail at your cost. You have a certain number of days to look at the lots and return them, usually by Express Mail and again at your cost.
You can see that the lots had better be spectacular to justify postal viewing, because its going to cost a bunch just to see them.
Another option to postal viewing is requesting a photocopy of the lots in question. This again will cost you money, but not as much as the postage for a two-way shipment.
Do not expect the auction house to send items if they do not know you. Remember, auction buying is not on approval.
Public auctions are impractical to fill all your needs, as only the more expensive items are offered.
Auctions can be disappointing. You will not enjoy the letdown when you fail to win a lot or you decide you do not want to pay more than another bidder.
An auction can also be a wonderful way to build a quality collection, whether you are just starting or you already have a good collection but just need to add that particular piece.
The most important point for anyone who participates in any auction is a complete understanding of the rules of the auction in which they are bidding. All auctions are not the same, but no reputable firm will object to answering questions about its auction.
Participate and enjoy!