Live auctions differ in important ways from other sales methods. Retail stores usually operate by having a fixed price marked on the item; wholesale or discount stores also have fixed prices. Garage sales or swap meets may have fixed prices or a sign saying “Make Best Offer” on some items, indicating the seller is willing to negotiate a purchase price. Houses and automobiles for sale have a listed “asking price,” but almost everyone knows it is common practice for the buyer to try to negotiate a lower price. So, you can see there are differences in how sales venues approach price.

A live auction is different from all these types in at least three major ways: First, and most obvious, is that there’s a crowd of people standing present and interested in buying that item. Second, the price will be determined by competitive bidding upward until there is no higher bid given; there is no negotiating the price downward. Third, the item is sold “As Is,” meaning it is sold in its present condition with no promises of repair by the seller, making the sale swifter and easier to complete.

Also consider that garage sales, swap meets and other types of sales are very time consuming for the seller (including the prep time, the time spent sitting and waiting for customers to come, etc.). Most of the marketing comes at these sales is in the form of a cardboard sign stuck in the ground, and sometimes through a general ad that publicizes the event, but not always their particular items or booth. And when the sale is over, there are always a large number of items left. You may have had a garage sale or yard sale, only to end up with half the items you had for sale back in your house.

The procedures are more professional with an auction. The Auctioneer and his or her staff take care of preparing items and estimating their fair market value. They then professionally market the sale so that people from throughout the county, state, or even country will know about it. And they make it their job to create a competitive and entertaining atmosphere that attracts consumers to the sale. Their hand gestures, eye contact with the crowd and their rhythmic “chant” stirs buyers and brings the sale to life.

Through auctions, sellers can obtain the highest possible price, dispose of all their property and receive money for their goods all in one day. Buyers have the opportunity to shop for unique merchandise and pay the price they want in the spirit of competition. All of these things separate auctions from other types of sales.