auction management



 

Consignment Fees

The commission screens included in the EZLister.net system permit the entry of flat rate commissions, sliding scale commissions, or combinations of these.  Furthermore, you can specify who pays auction and payment processing fees.  It is also possible to set up a default commission schedule applicable to the majority of your clients, or a specific commission schedule for consignors or items on a case by case basis.  This allows a consignment store operator total control over his operation by quickly and easily adapting fees to reflect a specific case at any time.

When entering consignment commission schedules, the first choice is to enter the type of commission you charge.  You can select a flat rate or a progressive (sliding scale) commission by selecting the appropriate radio button.  To illustrate the difference between the two, let’s look at an example. Assume that the commission schedule you decide to use appears as follows. 

Illustration of Possible Consignment Fee Schedule

Price Range

$0.00
to

$100.00

@

10.0%

$100.00
to

$500.00

@

7.5%

$500.00
& Up
@

5.0%

Please note that this commission fee schedule is intended for illustration purposes only and probably will not reflect what you ultimately choose to charge your clients.  The rate you charge should reflect prevailing conditions in you local market.

Illustration of Flat Rate Consignment Commission

Now, assume that an object sells for $750.00 and you charge a flat rate commission.  The total commission due is calculated as follows:

Price Range

$0.00
to
$100.00
@
10.0%
$100.00
to
$500.00
@
7.5%
$500.00
& Up
@
5.0%
 

Sale Price:

$750.00
 

Calculated Commission

$750.00

X
5.0%
=
$37.50

Note that the total commission is $37.50, or 5% of the total price.  The commission rate used reflects the price bracket containing the final sales price, or in this case, the $500 and up price bracket. 

Illustration of Progressive Consignment Commission Rate

Now, assume you charge commissions based on a progressive scale.  A progressive rate commission will calculate your commission as follows

Price Range

$0.00
to

$100.00

@
10.0%
$100.00
to

$500.00

@
7.5%
$500.00
 & Up
@
5.0%

Sale Price:

$750.00

Calculated Commission

$100.00
X
10.0%
=

$10.00

$400.00

X

7.5%

=
$30.00

$250.00

X

5.0%

=
$12.50

Total

$52.50

This is a similar concept to the sliding scale that eBay uses when calculating its final value fee structure.  The commission rate for each of the identified brackets is charged against the portion of the total sales price that falls in that price bracket.  This results in the consignment seller receiving a significantly higher commission.

How EZLister.net Handles Commissions with Deposits

In the EZLister.net system, under the Consignor menu, Add Consignments option, the Add New Consignment Item screen allows a consignment store operator to modify the default commission schedule for a specific item.  This screen is similar to others that appear at appropriate points in the system except that this one addresses the issue of deposits.  It contains a field, labeled Deposit, where the operator can enter the appropriate deposit amount required.  Under this field are two additional fields each with a checkmark box associated permitting the selection of one or the other.  Selecting the one labeled "Commission Plus Deposit" instructs the system to calculate the commission using the parameters specified, and to add the deposit amount to the result.  In effect, this means that the deposit was non refundable regardless of the outcome of the auction.  Selecting the field labeled "Commission Less Deposit" instructs the system to calculate the commission using the parameters specified and deduct the deposit amount from the result.  In effect, this means that the deposit served as a down payment on the consignment commission.  Again, the decision whether to charge deposits, and how to apply them at settlement is up to individual operators.  EZLister.net provides the flexibility to implement the final decision taken.

 

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