Earlier this year I wrote an investigative analysis titled “The Volatile State of Online Estate Auctions,” noting how tardy technological upgrades in addition to fees from auction portals and credit card companies—often combined with building rent and/or upkeep of onsite facilities—continued to push buyer premiums ever higher.
Shipping has always been an issue with auction houses. Some use third-party shippers. Some do not ship at all.. And a few charge high shipping fees..
These costs were passed to bidders, I noted. At first, auctioneers with onsite clientele did not charge local buyers any fees. Then many had to do so because of rising technology costs. Online buyer fees averaged about 10–15% six years ago and have gradually risen to 18%, 20%, and as high as 23%.
I observed that auctioneers were struggling to make ends meet and that they could pass costs to bidders until a tipping point had been reached.
This followup shows the results of that potential tipping point, comparing realized prices (hammer plus BP) of recent sales on HiBid.com, Proxibid, and eBay with those of GreatCollections, chosen because of the frequency of its online auctions that only sell coins slabbed by top holdering companies, such as PCGS, NGC, ANACS, and ICG.
It also is a warning to online portals to lower costs of auctioneers, to keep buyer premiums low. Sooner or later, aggressive big-house online auction companies are going to feature better buys in coins slabbed by top holdering companies.
Let’s start with one of the more common Carson City Morgan dollars, the 1883-CC with a mintage of 1,204,000. PCGS Price Guide puts the retail price of that coin at MS-63 at about $230.
In the past week, GreatCollections did not sell a coin at that mint-state level. This GSA example at MS-64 did sell with a bid of $196 (hammer) or $215.60 (realized with BP):
For comparison purposes I am using my favorite sellers on HiBid.com and Proxibid and not ones charging fees above 20%. Here is the bid history on a similar coin at MS-63 on HiBid:
You can see that the GreatCollections coin at higher grade sold for $10 less.
Proxibid sales of similar coins fared worse in this comparison. While no 1883-CC GSA PCGS-graded coin in large holder sold there recently, a raw GSA 1883-CC with no box or certificate of authentication at a grade of about MS-63 sold for the same bid money with higher BP:
The advantage of bidding on eBay is twofold: no buyer’s premium, and usually cheaper shipping charges than often found on auction portals, where one seller on Proxibid charges postage plus $9.95 handling fee per lot—even though smalls may be included in the same mailer:
While this seller is not typical on Proxibid, with regard to shipping, many sellers on the portal do overcharge, using free U.S. Post Office boxes and charging handling fees (sometimes even inappropriately using USPS boxes for packing!).
Here is a recent sale of an 1883-CC GSA Morgan dollar on eBay:
As you can see here, the realized price is about $5 lower than GreatCollections with free shipping, another savings.
A good barometer about the rising costs on auction portals, as opposed to major auction houses like GreatCollections, concerns gold coins. I will not longer bid competitively on HiBid or Proxibid on raw gold coins. Almost all have flaws, from cleaning to damage. But let’s do a price comparison again, because gold sales showcase major differences in online buying venues.
I won this coin, stored with my other coins in a local bank box (recommended for everyone reading this for security purposes), from GreatCollections:
As you can see from the fire symbol, this was a hotly contested auction with hammer price of $628 and realized price of $690.80.
I also won this coin on HiBid.com:
Same realized price, but this $10 gold coin is almost uncirculated and not holdered by PCGS. I put this at AU-55 (assuming it will slab). PCGS Price Guide lists retail of $750 at AU-55, or about $650 based on latest auction prices on PCGS CoinFacts. So if you add holdering and shipping costs, I’m down another $40. The GreatCollections coin retails at $810, about $100 more than I paid for mine.
No 1897 $10 gold sold recently on Proxibid. But a comparable coin, a 1906-D holdered by NGC, sold for $700 (hammer) or $840 (realized):
To be sure, you can still find incredible deals on HiBid and Proxibid, but they are becoming scarcer to locate with buyer’s premiums and shipping added to the realized price. And unless you know how to grade, don’t bid on raw coins because determining value is difficult via photographs.
The point here is that we are closing in on that tipping point in online estate auctions. Auctioneers need to cut costs and offer coins at no higher than 15% to keep competitive with aggressive big-house sellers like GreatCollections, which charges 10% buyer’s premium and ships typically at $9.50 Priority Mail plus 50 cents per lot. And Proxibid and HiBid should lower fees when possible or gradually risk losing business on their portals as auctioneers may keep passing costs to bidders.
What are your experiences at GreatCollections vs. HiBid, Proxibid and eBay? Share in the comments below! ❑
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Michael,
I operate an auction company that has used Proxibid and uses HiBid now. Many differences between the two platforms. Advertising costs are getting to be a bigger factor not mentioned.
I know, Jay. I think those portals have to decrease costs for auctioneers like you. I have patronized your auctions before and know you do a good job. Thanks for writing.
So, are you saying that eBay is the best place to buy coins? I like the ability to rate the Seller and readily see the comments a Seller has received. It is too bad that Sellers can no longer give Buyers a Neutral or Negative Feedback, though — Sellers can only give Buyers Positive Feedback if they choose to give any Feedback, at all. As a Seller, I’d want to block “bad Buyers” from participating. Also, can you please give a “101 How-To Course” on slabbing coins? When I was actively collecting years ago, slabs were quite rare — now that I am interested in Selling, slabs are pretty much the norm, it seems. As a Seller, I prefer selling slabbed coins (no argument about grade — so likely no Negative Feedback and/or returns) but how do I go about slabbing coins and what do you think about the conservation service (“cleaning service”) that some grading companies offer? I went to the Whitman Show in Baltimore and, as a novice Seller, I had a hard time handing over coins to a stranger at one of the grading companies in the hopes that what I gave them is what I will get back — plus there was quite a line of anxious customers and many of the grading reps looked and behaved like they needed a break. Needless to say, I didn’t get anything slabbed at the Whitman Show and still haven’t slabbed anything.
Well, eBay is becoming more attractive primarily because there is no buyer’s premium, and also because shipping can be reasonable.The point of the piece is that auction portals are charging high fees and auctioneers are reluctant to cater to the online buying clientele. I used to buy on Proxibid and sell on GreatCollections and eBay, where competition can be keen. But now it is difficult to get coins at reasonable prices on Proxibid and Hibid.com.
I need to test the conservation service. I intend to do that in a few weeks. I usually slab at PCGS and sometimes at NGC. No real gripes there, but occasional ones. For instance, at PCGS, sometimes the grade is way too low for the condition; so I resend and usually am right in my assessment.