A lot of trading and socializing goes on at most stamp club meetings, and my club, the Orange County Philatelic Society, is no exception. The main feature of our club, however, is the auction. This robust event usually contains some 150 lots, reserved at anywhere from 25 cents to more than $100. Each member is allowed up to 10 lots, and I usually contribute every month.
A good deal of the success I have (rarely does one of my auction lots go unsold), comes from pricing. I tend to put reserve prices at 10 percent of catalog value or less. A lot that sells at reserve does not give me a great return, but I take a few other factors into account.
First, the stamps in some of my lots have sat around my house for a considerable period of time, and I would much rather have them sit around yours. I think you’d agree that we all have too many stamps cluttering up our lives, and just to be shod of a few is value in itself. The money they draw is icing on the cake.
Second, if I sell $10 catalog value lots for $1, I have made other club members very happy, and they will leave the meet feeling pleased with their purchases. This is good for the club. How many members would keep coming back if they did not think they were getting a good deal from time to time?
Finally, sometimes my lots encourage multiple bidders, which is what I am aiming for. If a $10 catalog value lot gets a second bid (increments are $1 at this bid point) and sells for $2, then I have made a respectable 20 percent. If the first bidder jumps back in, as they are inclined to do, I’ve now made 30 percent. You can see where this is heading. On occasion, I’ve made 50 percent catalog value or more from lots that received multiple bids.
On the buying side of the coin, my philosophy is simple: I want stamps at 10 percent catalog value or lower. This is tricky. Aside from “wallpaper” from Eastern Europe, South America, Sand Dune countries and the likes, nobody wants to sell at 10 cents on the dollar. I respect this. I’ve done my fair share of haggling, but I try not to make it uncomfortable for the seller. I realize he wants a good price, so I will often ask if there is any “wiggle room” on his deal. If I make a low-ball offer I will usually explain why, and suggest he hold out for something better, accepting mine only if this does not happen.
I keep a very close account of who I buy from. If Billy Bob gives me a good deal, I will go back to him for more. I’m quick to tell him this up front, as an incentive. If I make a purchase that turns out bad, and I see him again, I will usually say something like, “Well, Billy Bob, that last deal didn't turn out too good for me.” I don't blame him, because it was my choice to buy, and on occasion he will do better next time.
And auctions? The trick there is simple: Jot down only your upper limit bid. The reserve is irrelevant, and if you lack the necessary discipline to stop when you should (very difficult at times, particularly when testosterone kicks in!), you have a recipe for disaster.
So, there you have it. In a nutshell, buy low, sell high, and try not to disappoint too many people along the way!