Coronavirus forces shift in the way auction houses operate
Philatelic Foreword by Jay Bigalke
The stamp industry and the way business is conducted are changing because of the coronavirus COVID-19 pandemic. Some of these changes were predictable, but this situation has accelerated them.
With all of this in mind, I reached out to a number of stamp auction houses in the United States that have operated with traditional floor biding for years and asked them the following two questions.
1. In the short term, how is your auction house handling current auctions and auctions that are scheduled during the next few months?
2. For a more long-term view, how do you think the implications of this social-distancing situation as a result of the coronavirus pandemic will affect the future of the stamp auction industry in the United States?
In alphabetical order, here are the responses that I received before the deadline for May 11 issue of Linn’s.
Josh Buchsbayew, vice president of Cherrystone Auctions in New York City, responded.
Question 1: At the moment we are all working remotely and one of us goes in sparsely to collect the mail, ship out some lots, etc. We have an auction next week as well as two in early May which will proceed as planned, albeit without a physical room (it will be exclusively online and over the phone). So far it seems like there is plenty of interest in the sales and as of now the impact appears to be minimal. We are also receiving consignments in our homes and are already working on a June sale, which we have no plans on postponing.
Question 2: Long term there will be implications as we cannot attend shows or visit clients as much as we are accustomed to but I think we will adapt using technology (Zoom, FaceTime, etc.), and shipping (Fedex/UPS/USPS) is still up and running as per usual. Obviously this will all change if/when there is a vaccine and/or treatment. Until then we will try and keep up as much as we have in the past.
Dutch Country Auctions
Russ Eggert, owner of Dutch Country Auctions in Wilmington, Del., responded.
Question 1: As we are located in Delaware, internet businesses are considered essential and we are able to continue functioning in those areas. We are not allowed to serve retail customers in our store or have curbside pickups. Our staff work remotely or flexible hours, and when in the store, all adhere to social distancing guidelines, therefore, we can work preparing upcoming and future auctions. The major difference to us is converting our public auctions to live internet auctions. We will have coin auctions in April; one live bidding and the second an internet mail sale. Our May stamp auction will probably be live internet bidding also. So the impact for us has been minor.
Question 2: Long term, the view is very optimistic. We believe the hobby will continue and may grow more lively in the recent future. Many of our buyers do not like being without stamps to sort or mount. The Coronavirus will certainly push more buying and selling to the internet. Auctions like ours play an important role in the philatelic and numismatic industries. We become the outlet for large holdings to be dispersed and the location for future internet dealer to purchase what they need.
Charles Epting, president of H.R. Harmer of New York City, responded.
Question 1: As an auction house, we have a responsibility to do right by both our consignors and our bidders. In both cases that means providing safe, responsible viewing of auction lots (either in our office or online) and ensuring that bidders and agents are able to efficiently execute their bids (again, either in the auction room or through a digital platform). Logistically it is much easier to hold a sale of single stamps and covers at a time like this, as we can host high-resolution images of these items on our website. Our bigger concern right now is a sale containing collections, which oftentimes need to be viewed in-person for bidders to be able to determine their value. We have postponed our May sales and will try our hand in June at conducting a hybrid live/internet auction: with a live auctioneer and phone bidding, but with a “digital” floor rather than an auction room.
Question 2: It’s undeniable that the stamp auction industry in the United States has been moving more and more into the digital sphere over the last decade or so. I think that the current pandemic will prove to be a catalyst that hastens this shift. As online bidding becomes more convenient, the necessity of attending sales in person becomes less important to collectors. While online live auctions held through platforms such as Stamp Circuit might seem like the future of the auction industry, the reality is that they’re already the present — and it’s up to us as auctioneers to make the transition as painless as possible for everyone.
Daniel F. Kelleher Auctions
David M. Coogle, co-chairman of Daniel F. Kelleher Auctions of Danbury, Conn., Hong Kong and London, responded.
Question 1. We are on-schedule and have fully embraced technologies to safely service our client’s needs. We have been working on an enterprise level auction platform that will be available in phases beginning in June, so most of these technologies have been top-of-mind and strategies have already been implemented to use them. We have utilized these current technologies and strategies along with extensive imaging by both PDF and MP4 videos of many of the lots we are presenting online. Our public sales 736-738 went off without a hitch with limited on-site staff and the rest working remotely. These sales generated revenues at 110 percent of our pre-COVID 19 expectations. We have been fortunate enough to retain the majority of our staff that is now diligently working remotely from home. Our no on-site viewing for collection offerings had a pilot sale 5096 which was extremely successful, 70 percent of the lots selling at 90 percent of the estimate average.
We have a larger Public auction sale closing Saturday April 25th, again with extensive imaging and video viewing, extremely sensitive and time responsive client services on questions. I think a bigger issue is that there seems to be a spike in demand with clients having more disposable time, they are turning to their hobby. Stamps up and into 4 figures are performing exceedingly well, we noticed a 25 percent increase in the overall participation of our Flagship sale in both number of bidders and bids per lot.
We have weekly online sales that we are increasing in both scope and depth of offerings and are receiving very positive results. We intend to carry on with our next public Flagship sales for May and continue increased online offerings.
Question 2: The new norm is here. Online and video engagement will become standard with not in-person engagements. Curb-side pickups for consignments as well as shipments will also become standard. We above all want to keep everyone involved, from our staff to our clients safe and will look to leverage any areas that can be done successfully. We are looking into UV sanitation possibilities for incoming and outgoing shipments. As a firm that has invested heavily in technologies and online engagement, we anticipate assuming a wider role in this new arena, providing our boutique auction services to all clients.
Rasdale Stamp Co.
Kim E. Kellermann, senior United States describer for Rasdale Stamp Co. of Chicago, Ill., responded.
Question 1: Below is a copy of a communication release we sent to our customers and associates the week of April 6th.
We want to assure you that we take the health and well-being of our community, customers, and associates very seriously. Like you, we’re closely monitoring the quickly developing effects of the Coronavirus (COVID-19) pandemic.
As Illinois is currently under a “stay at home” policy due to Covid 19 we, at Rasdale Stamp Company, have decided to reschedule our May Public Auction to August 15-16, 2020. We are available by email or telephone to answer your questions or address your concerns.
We are also still accepting emails (firstname.lastname@example.org) or telephone calls (630.794.9900) regarding possible consignments. Our hope is to schedule appointments beginning in May. We look forward to going back to business as usual as soon as conditions allow. We are all in this together. Please stay safe and well.
Question 2: My long-term view of the implications of this social-distancing situation, AHHHHHHHHHH, let me look into my crystal ball.
There is no question in my mind the future of social gathering no matter the size will be impacted from a NFL stadium to our auction floor. Because the ratio of the square footage of our gallery to the number of auction attendees social distancing, at present we cannot hold to guidance from public health officials and government agencies. Our next sale will be August, so we are taking a wait and see attitude of our social gathering policy. There are numerous specifics the family will have to address, and a definitive plan will be in place to insure the health and well-being for EVERYONE.
On a side note, I am cautiously optimistic about the future of our family company. Running a query using our data base I found that over 98 percent of our sales coming directly from our website. Through my initiative, planning, and guidance we have moved to a near 100 percent digital company regarding how we run our public auction.
Examples: 1. Using Google analytics to address attracting potential buyers and sellers; 2. We do not publish a hard copy catalog. However hard copies are available by downloading a PDF version with no images from our website; 3. On average we posted over 8000 images per auction this year; 4. Creating a robust and intuitive website to present and run an auction from the pre-auction bidding cycle to the actual “Rasdale Live Auctions” where people from all over the world can compete against our gallery floor in real time; 5. Generating post auction reports sent via email to the winners of their results; and 6. Generating pre and post auction reports sent to our consignors via email.
Like tens of thousands of other small businesses have had to take a hard look at our balance sheet and come up with a plan to address our reduced cash flow.
We will continue to monitor the COVID-19 situation and will follow guidance from public health officials and government agencies. Specifically, in respect to social distancing.
Robert A. Siegel Auction Galleries, Inc.
Scott R. Trepel, president of Robert A. Siegel Auction Galleries of New York City, responded.
Question 1: You can read about our “virtual saleroom” on our website. Our staff handles phone bidding from their homes, and I conduct the auction from my home with each of them visible on screen through Zoom. SAN [Stamp Auction Network] works just as it always does. Our “Dubois” and Morton auctions were successes from logistical and market perspectives. We will continue to run auctions this way until the stay-at-home rules are suspended. If I can figure out a way to call an auction from a pool float, I’m set for summer.
Question 2: I think many businesses have been pushed toward internet-based transactions, and the pandemic may have been the final shove. Perhaps commercial landlords in New York City will reduce rents to keep occupants, but I think many small businesses will move out of urban centers. As for the stamp market, in particular, it’s an “at home” hobby. We thrive on reclusiveness! The shows and exhibitions might need to consolidate, but they should have been doing that for years. Fewer, bigger and better is the future.
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