How an auction works
Overview of an auction
For those attending an auction for the first time, don’t worry… you won’t get stuck with a $20M Van
Gogh just because of an ill-timed scratch of the nose. The auction process, at least in the modern era,
goes back 470 years and is a tightly run operation that leaves nothing to chance. The Internet has transformed
the auction process, creating a landscape in which thousands of goods and services can be offered for bidding
from anywhere and at any time.
History of auction
What is an online only auction?
An online-only auction takes place only online. Bidding activity takes place
on the internet over a set period of time and there are no in-room, telephone or absentee bidders.
How does auction work?
What’s the difference between a Live Auction and a Timed Online Auction?
Live Auction
A live auction is hosted by an auctioneer in real time, typically at the gallery or salesroom of the auctioneer, and is held before
an audience of bidders. Bidsquare is a service that allows a bidder to remotely participate in a live gallery auction via the internet.
Other bidders might participate -- in person, by phone or through an absentee bid sent in prior to the auction. Bidsquare participants
place their bids via a computer, bidding in response to bids placed by others. Your bids are automatically received by a remote clerk,
who places your bid in real time. Bidding will continue (usually at defined increments) until competition for the lot end s.
If the highest bid offered meets the minimum price designated by the seller as acceptable, the lot is sold. The auctioneer will
then move on to the next lot.
Timed Online Only Auctions
A timed online only auction is automated and takes place solely online. The bidding for each lot is opened at a predetermined level set
by the auctioneer, usually at a set time and stays open over an extended period of hours or days. During this period of open bidding, a bidder
will be able to see the current high bid on each lot. You may place a higher bid at a defined bidding increment you choose.
A bidder’s identity is always kept confidential during the auction. In a timed only online auction bidders are automatically informed by email if they are the high bidder, or if they have been outbid by another competing bidder. At the end of the defined bidding period, if the highest bid offered meets the minimum price designated by the seller as acceptable, the lot is sold. Bidding on all lots in a timed online only sales begin to close at a specified time, with lots closing at regular intervals until the auction has ended. Some timed auctions allow extended bidding. In such a case, if a bid is placed on a lot within a specified time before closing, the bidding may automatically be extended for a set period of time. Length of extended bidding is set by the auctioneer prior to the opening of the auction.
How to bid live
Once you are registered for an auction you are set to bid. You can now bid two different ways – live bidding or by leaving an absentee bid. New to live bidding?
View the short video to see how it works.
Will I really be bidding live and in real-time with the auction?
Yes. The bid clerk at the auction house will signal the auctioneer when they have bids from the internet and will bid on behalf of Bidsquare internet bidders in pace with the auction.
How to register to bid in an auction?
To bid in any auction you must first register for the auction. To register click the green 'Register Now' button on the right of any auction landing page.
You will also find a 'Register to bid' green button on every lot page.
Once you register, the auction house will get notified and will approve you for bidding or request additional information to complete registration. You will receive an email notification once you are approved for bidding. Once approved you can leave an absentee bid or bid live.
Once you register, the auction house will get notified and will approve you for bidding or request additional information to complete registration. You will receive an email notification once you are approved for bidding. Once approved you can leave an absentee bid or bid live.
Important! Register Early
Please allow for enough time for approval. Most auction houses approve immediately, while others take 1-2 days for approval. Registering a few days in advance
of the auction will ensure you will be approved to bid in time for the auction. If you register the day of the auction, please note you may not be approved
to bid as it is up to the auction house’s discretion.
How will I know if my bid was successful?
All successful bidders can confirm their winning bid by checking the “MyBidsquare” tab. In addition,
all successful bidders will receive an email notifying them of their winning bid after the auction closes.
View auction Terms
Absentee Bid
A method of bidding for those who cannot or do not wish to attend an auction. Absentee bids are also called "left" or "order" bids. An absentee bid may be placed before an auction begins.
View the short video below on how to leave an absentee bid.
Asking Price (a.k.a. Bid Price)
When a bidder places a bid, the auctioneer asks the other bidders if any of them will pay a specific amount above the current
bid – the ask price. Bid Increment: The amount by which the auctioneer increases the bidding. In general, the auctioneer will
request bids of about 10% higher than the previous bid. For instance, if the bidding opens at $5,000, subsequent bids of $5,500,
$6,000, $6,500, etc. would follow. The auctioneer can vary at his/her discretion.
Bidder Number
Every registered bidder receives a unique bidder number when they register for a given auction. If you are the highest
bidder - the lot number, the final bid price and your bidder number goes into the auctioneer’s book and a back-up set
of records known as clerking sheets to verify your purchase. View the short video directly below on live bidding to view
where your bidder number is located during a sale.
Bought-In (a.k.a. Passed)
If there are no bids on a lot, or if bidding does not reach the lowest possible selling price, the lot in "bought in",
meaning it is unsold and remains the property of the owner.
Buyer
The person who placed the highest bid on an item becomes the buyer, or new owner of that item when his/her bid is accepted by the auctioneer.
Buyer’s Premium
The percentage above the hammer price paid by the buyer to the auction house that is part of the total purchase price.
Clerk
A person employed by an auction house to record for each lot sold, the lot number, the final bid price and the bidding number of the high bidder.
Competing Bids
Before and during a sale, an auction house accepts competing bids for a lot from absentee bidders, phone bidders, online and in room bidders if all of these bidding methods are available.
Condition Report
A written description of the imperfections of an object (or lack thereof), particularly of characteristics that might affect value. This is essential information for prospective bidders.
Consignor(a.k.a. Seller)
The owner who is authorizing the auction house to act as agent on his or her behalf for sale.
Consignor Agreement
The contract between the auction house and consignor.
Fair Warning
When an auctioneer announces "fair warning", he/she is saying, "Bid now or I am closing the lot. This is your last chance." If there are no bids forthcoming,
the auctioneer’s hammer falls and the sale is complete for that lot.
Final Selling Price
Hammer Price/High Bid + Buyer’s Premium
Hammer Price
The highest bid accepted/the winning bid for a lot at auction/the price at which the auctioneer’s “hammer” falls. Note that this does not include the buyer’s premium.
Live Auction
A live auction is hosted by an auctioneer in real time, typically at the gallery or salesroom of the auctioneer, and is held before an audience of bidders.
Bidsquare is a service that allows a bidder to remotely participate in a live gallery auction via the internet. Other bidders might participate -- in person,
by phone or through an absentee bid sent in prior to the auction. Bidsquare participants place their bids via a computer, bidding in response to bids placed by others.
Your bids are automatically received by a remote clerk, who places your bid in real time. Bidding will continue (usually at defined increments) until competition for the lot ends.
If the highest bid offered meets the minimum price designated by the seller as acceptable, the lot is sold. The auctioneer will then move on to the next lot. View the short video
below to see how a live auction runs on Bidsquare.
Lot
An individual object or group of objects offered for sale at auction as a unit.
Lot Number
Every lot in an auction is given a unique lot number. The lots are sold in numerical order.
Online Bidding
The option of bidding on Bidsquare in advance of an auction or in real time during an auction through a computer or mobile device.
Preview (a.k.a. Exhibition)
Every lot goes on public display in the days before an auction, whether at the auction house or online or both. Specialists are available to answer all questions.
Auction house previews are typically free and open to the public.
Reserve Price
The reserve price is the lowest price which a seller is willing to accept for his or her property. At many auction houses, reserves must be set at or below the low estimate,
and if bidding ends before the reserve is reached, the property will not be sold. An auction house may disclose the reserve; mark items which have reserves or keep the
reserve confidential for the seller. Most auction houses keep the reserve confidential for the seller.
Results
Soon after every auction, the selling prices, known as the results, are posted online. Customarily, the results include the hammer price plus the buyer’s premium,
as this is the full amount the buyer has agreed to pay.
Seller’s Commission
The commission paid by an owner to the auction house for acting as the owner’s agent in the sale of his property. The auction house deducts the seller’s commission
(and any agreed upon expenses) from the hammer price and send the rest to the owner.
Starting Price
The starting price is the lowest price at which a lot can sell (unless a reserve price is specified).
Timed Online Only Auction
A timed online only auction is automated and takes place solely online. The bidding for each lot is opened at a predetermined level set by
the auctioneer, usually at a set time and stays open over an extended period of hours or days. During this period of open bidding one will
be able to see the current high bid on each lot. You may place a higher bid at a defined bidding increment you choose. View the short
video below for a further explanation of timed online only auctions.
Terms of Sale
The contract between the bidder and the auction house that specifies the legal terms governing bidding and purchase.
