auction management



 

Consignment Fees

On this screen, the first choice is to enter the type of commission you charge.  If you charge a flat rate, then press this radio button, if you charge on a progressive or sliding scale, then press the second 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. 

Price Range

     

$0.00

to

$100.00

@

10.0%

$100.01

to

$500.00

@

7.5%

$500.01

& Up

 

@

5.0%

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

Now, assume that an object sells for $750.00.   A flat rate commission will calculate your commission as follows:

Price Range

     

$0.00

to

$100.00

@

10.0%

$100.01

to

$500.00

@

7.5%

$500.01

& 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. 

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%

$100.01

to

$500.00

@

7.5%

$500.01

 & 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.  

 

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